Solar Farm Profit Calculator

Solar Farm Profit Calculator

Estimate the potential profitability of your solar farm project by inputting key operational and financial metrics.

Total installed power of the solar farm in kilowatts.

Average hours per day the solar panels receive peak sunlight (also known as 'peak sun hours' or 'solar insolation').

Overall efficiency of the solar system, accounting for panel efficiency, inverter losses, wiring losses, and other factors. Typically 75-85%.

The price at which the generated electricity is sold to the grid or consumers.

The total upfront cost to build the solar farm, per kilowatt of installed capacity.

Annual operational and maintenance costs for the solar farm, per kilowatt of installed capacity.

The percentage of efficiency lost by the solar panels each year due to aging.

The expected operational life of the solar farm.

function calculateSolarProfit() { var systemCapacity = parseFloat(document.getElementById('systemCapacity').value); var avgSunlightHours = parseFloat(document.getElementById('avgSunlightHours').value); var systemEfficiency = parseFloat(document.getElementById('systemEfficiency').value); var electricityPrice = parseFloat(document.getElementById('electricityPrice').value); var initialInvestmentPerKW = parseFloat(document.getElementById('initialInvestmentPerKW').value); var annualOMCostPerKW = parseFloat(document.getElementById('annualOMCostPerKW').value); var panelDegradationRate = parseFloat(document.getElementById('panelDegradationRate').value); var projectLifespan = parseInt(document.getElementById('projectLifespan').value); var resultDiv = document.getElementById('solarProfitResult'); resultDiv.innerHTML = "; // Clear previous results // Input validation if (isNaN(systemCapacity) || systemCapacity <= 0 || isNaN(avgSunlightHours) || avgSunlightHours <= 0 || isNaN(systemEfficiency) || systemEfficiency 100 || isNaN(electricityPrice) || electricityPrice <= 0 || isNaN(initialInvestmentPerKW) || initialInvestmentPerKW <= 0 || isNaN(annualOMCostPerKW) || annualOMCostPerKW < 0 || isNaN(panelDegradationRate) || panelDegradationRate 100 || isNaN(projectLifespan) || projectLifespan <= 0) { resultDiv.innerHTML = 'Please enter valid positive numbers for all fields. System Efficiency and Degradation Rate should be between 0 and 100.'; return; } // Convert percentages to decimals systemEfficiency /= 100; panelDegradationRate /= 100; // — Calculations — var totalInitialInvestment = systemCapacity * initialInvestmentPerKW; var annualEnergyProductionYear1 = systemCapacity * avgSunlightHours * 365 * systemEfficiency; var annualOMCost = systemCapacity * annualOMCostPerKW; var totalRevenue = 0; var totalOMCostsOverLifespan = 0; var cumulativeCashFlow = -totalInitialInvestment; // Start with initial investment as negative cash flow var paybackPeriod = 'N/A'; var currentAnnualProduction = annualEnergyProductionYear1; var cumulativeEnergyProduction = 0; var cashFlows = []; // To track cash flow year by year for payback period for (var year = 1; year = 0) { // Calculate fractional payback period var previousCumulativeCashFlow = -totalInitialInvestment; for (var i = 0; i 0) { paybackPeriod = (year – 1) + (Math.abs(previousCumulativeCashFlow) / netCashFlowThisYear); } else { // If net cash flow for the year it turns positive is zero or negative, // it means it barely broke even or dipped again, so payback is effectively longer. paybackPeriod = 'Longer than ' + projectLifespan + ' years'; } } // Apply degradation for the next year's calculation currentAnnualProduction *= (1 – panelDegradationRate); } var netProfit = totalRevenue – totalOMCostsOverLifespan – totalInitialInvestment; // — Display Results — var resultsHTML = '

Calculation Results:

'; resultsHTML += 'Total Initial Investment: $' + totalInitialInvestment.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + "; resultsHTML += 'Estimated Total Energy Production (over ' + projectLifespan + ' years): ' + cumulativeEnergyProduction.toLocaleString(undefined, {minimumFractionDigits: 0, maximumFractionDigits: 0}) + ' kWh'; resultsHTML += 'Estimated Total Revenue (over ' + projectLifespan + ' years): $' + totalRevenue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + "; resultsHTML += 'Estimated Total O&M Costs (over ' + projectLifespan + ' years): $' + totalOMCostsOverLifespan.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + "; resultsHTML += 'Estimated Net Profit (over ' + projectLifespan + ' years): $' + netProfit.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}) + "; if (paybackPeriod !== 'N/A' && typeof paybackPeriod === 'number') { resultsHTML += 'Estimated Payback Period: ' + paybackPeriod.toLocaleString(undefined, {minimumFractionDigits: 1, maximumFractionDigits: 1}) + ' years'; } else if (netProfit >= 0 && paybackPeriod === 'N/A') { resultsHTML += 'Estimated Payback Period: Longer than ' + projectLifespan + ' years (but profitable)'; } else { resultsHTML += 'Estimated Payback Period: Project is not profitable within ' + projectLifespan + ' years'; } resultDiv.innerHTML = resultsHTML; } .solar-farm-profit-calculator { font-family: 'Segoe UI', Tahoma, Geneva, Verdana, sans-serif; background-color: #f9f9f9; padding: 25px; border-radius: 10px; box-shadow: 0 4px 12px rgba(0, 0, 0, 0.08); max-width: 700px; margin: 20px auto; border: 1px solid #e0e0e0; } .solar-farm-profit-calculator h2 { color: #2c3e50; text-align: center; margin-bottom: 20px; font-size: 1.8em; } .solar-farm-profit-calculator p { color: #34495e; line-height: 1.6; margin-bottom: 10px; } .calculator-input-group { margin-bottom: 18px; padding: 10px; background-color: #ffffff; border-radius: 8px; border: 1px solid #e8e8e8; } .calculator-input-group label { display: block; margin-bottom: 8px; font-weight: bold; color: #34495e; font-size: 0.95em; } .calculator-input-group input[type="number"] { width: calc(100% – 20px); padding: 10px; border: 1px solid #ccc; border-radius: 5px; font-size: 1em; box-sizing: border-box; transition: border-color 0.3s ease; } .calculator-input-group input[type="number"]:focus { border-color: #007bff; outline: none; box-shadow: 0 0 5px rgba(0, 123, 255, 0.2); } .calculator-input-group .input-description { font-size: 0.85em; color: #7f8c8d; margin-top: 5px; margin-bottom: 0; } .solar-farm-profit-calculator button { display: block; width: 100%; padding: 12px 20px; background-color: #28a745; color: white; border: none; border-radius: 5px; font-size: 1.1em; cursor: pointer; transition: background-color 0.3s ease, transform 0.2s ease; margin-top: 20px; } .solar-farm-profit-calculator button:hover { background-color: #218838; transform: translateY(-2px); } .calculator-result { margin-top: 30px; padding: 20px; background-color: #eaf7ed; border: 1px solid #d4edda; border-radius: 8px; color: #155724; font-size: 1.1em; line-height: 1.8; } .calculator-result h3 { color: #2c3e50; margin-top: 0; margin-bottom: 15px; font-size: 1.5em; border-bottom: 1px solid #d4edda; padding-bottom: 10px; } .calculator-result p { margin-bottom: 8px; } .calculator-result p strong { color: #2c3e50; }

Understanding Solar Farm Profitability

Solar farms, also known as solar power plants or photovoltaic (PV) power stations, are large-scale installations designed to generate electricity from sunlight. They represent a significant investment, but with careful planning and favorable conditions, they can yield substantial long-term profits. Understanding the key factors that influence profitability is crucial for anyone considering such a venture.

Key Factors Influencing Solar Farm Profit

Several variables determine the financial success of a solar farm. These include:

• System Capacity (kW): This is the total power output capability of your solar farm. A larger capacity generally means more electricity generation, but also higher initial investment costs.
• Average Daily Peak Sunlight Hours: Also known as solar insolation, this measures the average amount of solar energy received at a specific location. Locations with more consistent and intense sunlight will naturally produce more electricity.
• System Efficiency Factor: This accounts for the overall performance of your solar system, including the efficiency of the panels themselves, inverter losses, wiring losses, and other environmental factors. A higher efficiency means more of the captured sunlight is converted into usable electricity.
• Electricity Sale Price ($/kWh): The price at which you can sell the generated electricity is a direct driver of revenue. This can vary significantly based on local regulations, power purchase agreements (PPAs), and market rates.
• Initial Investment Cost ($/kW): This includes the cost of land, panels, inverters, racking, installation, grid connection, and permitting. Lower upfront costs improve profitability and shorten the payback period.
• Annual O&M Cost ($/kW/year): Operational and maintenance costs cover activities like cleaning, repairs, monitoring, and insurance. Keeping these costs low is essential for maximizing net profit.
• Annual Panel Degradation Rate (%): Solar panels gradually lose efficiency over time. This degradation rate, typically around 0.5% per year, reduces energy production and, consequently, revenue over the project's lifespan.
• Project Lifespan (years): The expected operational life of the solar farm, usually 20-30 years, directly impacts the total energy produced and the cumulative revenue and costs.

How the Solar Farm Profit Calculator Works

Our calculator takes these critical inputs to provide an estimate of your solar farm's financial performance:

1. Total Initial Investment: Calculated by multiplying your system capacity by the initial investment cost per kilowatt.
2. Annual Energy Production: This is estimated based on your system capacity, average daily peak sunlight hours, and system efficiency. The calculator then accounts for annual panel degradation over the project's lifespan.
3. Total Revenue: Derived from the total energy produced over the project's lifespan multiplied by your electricity sale price.
4. Total O&M Costs: Calculated by multiplying the annual O&M cost per kilowatt by the system capacity and the project lifespan.
5. Net Profit: This is the total revenue minus the total O&M costs and the total initial investment.
6. Payback Period: This indicates how many years it will take for the cumulative net cash flow from the solar farm to cover the initial investment.

Example Calculation:

Let's consider a hypothetical 1 MW (1000 kW) solar farm:

• System Capacity: 1000 kW
• Average Daily Peak Sunlight Hours: 4.5 hours
• System Efficiency Factor: 80%
• Electricity Sale Price: $0.12/kWh
• Initial Investment Cost: $1500/kW
• Annual O&M Cost: $15/kW/year
• Annual Panel Degradation Rate: 0.5%
• Project Lifespan: 25 years

Step-by-Step Breakdown:

Using the values above, the calculator would perform the following:

1. Total Initial Investment: 1000 kW * $1500/kW = $1,500,000
2. Annual Energy Production (Year 1): 1000 kW * 4.5 hours/day * 365 days/year * 0.80 (efficiency) = 1,314,000 kWh
3. Annual O&M Cost: 1000 kW * $15/kW/year = $15,000
4. Revenue Year 1: 1,314,000 kWh * $0.12/kWh = $157,680
5. Net Cash Flow Year 1 (before initial investment): $157,680 – $15,000 = $142,680
6. Cumulative Energy Production (over 25 years, with degradation): Approximately 31,000,000 kWh
7. Total Revenue (over 25 years): Approximately $3,720,000
8. Total O&M Costs (over 25 years): $15,000/year * 25 years = $375,000
9. Estimated Net Profit: $3,720,000 (Total Revenue) – $375,000 (Total O&M) – $1,500,000 (Initial Investment) = $1,845,000
10. Estimated Payback Period: Approximately 10.5 years (This is calculated iteratively, finding the point where cumulative cash flow turns positive).

This example demonstrates how a solar farm can generate significant profit over its operational life, even after accounting for initial investment and ongoing costs. Use the calculator above to run your own scenarios and assess the potential of your solar farm project.