Solar Panel ROI & Payback Calculator
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margin: 0 auto;
padding: 20px;
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border: 1px solid #e0e0e0;
border-radius: 8px;
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.sp-calc-header {
text-align: center;
margin-bottom: 30px;
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.sp-calc-header h2 {
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.sp-input-group .sp-suffix {
position: absolute;
right: 10px;
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text-align: center;
margin-top: 20px;
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function calculateSolarROI() {
// Inputs
var totalCost = parseFloat(document.getElementById('sp_total_cost').value);
var taxCreditPercent = parseFloat(document.getElementById('sp_tax_credit').value);
var systemSize = parseFloat(document.getElementById('sp_system_size').value); // kW
var sunHours = parseFloat(document.getElementById('sp_sun_hours').value); // Daily average
var kwhCost = parseFloat(document.getElementById('sp_kwh_cost').value); // $/kWh
var energyInflation = parseFloat(document.getElementById('sp_inflation').value); // %
// Validation
if (isNaN(totalCost) || totalCost <= 0 || isNaN(systemSize) || systemSize <= 0 || isNaN(kwhCost)) {
alert("Please enter valid positive numbers for System Cost, System Size, and Electricity Cost.");
return;
}
if (isNaN(taxCreditPercent)) taxCreditPercent = 0;
if (isNaN(sunHours)) sunHours = 4; // Default to moderate sun
if (isNaN(energyInflation)) energyInflation = 3; // Default 3%
// Calculations
// 1. Net System Cost
var taxCreditAmount = totalCost * (taxCreditPercent / 100);
var netCost = totalCost – taxCreditAmount;
// 2. Annual Production (kWh)
// Formula: Size (kW) * Hours/Day * 365 Days * Efficiency Factor (0.75 is standard for losses)
// We will assume the user enters "Peak Sun Hours" which accounts for irradiance.
// We will apply a standard 0.85 system efficiency ratio (derate factor).
var efficiencyRatio = 0.85;
var annualProduction = systemSize * sunHours * 365 * efficiencyRatio;
// 3. First Year Savings
var year1Savings = annualProduction * kwhCost;
// 4. Payback Period & 25 Year Savings
var cumulativeSavings = 0;
var paybackYears = 0;
var reachedPayback = false;
var total25YearSavings = 0;
var currentYearSavings = year1Savings;
for (var year = 1; year = netCost) {
// Calculate fractional year for precision
var previousCumulative = cumulativeSavings – currentYearSavings;
var remainingCost = netCost – previousCumulative;
var fraction = remainingCost / currentYearSavings;
paybackYears = (year – 1) + fraction;
reachedPayback = true;
}
// Inflate energy price for next year
currentYearSavings = currentYearSavings * (1 + (energyInflation / 100));
// Degrade system efficiency slightly (0.5% per year)
currentYearSavings = currentYearSavings * 0.995;
}
total25YearSavings = cumulativeSavings;
// 5. ROI
// ROI = (Total Lifetime Savings – Net Cost) / Net Cost * 100
var totalLifetimeProfit = total25YearSavings – netCost;
var roi = (totalLifetimeProfit / netCost) * 100;
// Display Results
document.getElementById('res_net_cost').innerText = "$" + netCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res_annual_savings').innerText = "$" + year1Savings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res_payback').innerText = paybackYears > 0 ? paybackYears.toFixed(1) + " Years" : "25+ Years";
document.getElementById('res_total_savings').innerText = "$" + total25YearSavings.toLocaleString(undefined, {minimumFractionDigits: 0, maximumFractionDigits: 0});
document.getElementById('res_roi').innerText = roi.toFixed(1) + "%";
document.getElementById('sp-results').style.display = "block";
}
Solar Panel ROI Calculator
Estimate your savings, payback period, and return on investment for residential solar.
Projected Results
Net System Cost (After Tax Credit):–
Estimated 1st Year Savings:–
Payback Period:–
25-Year Total Savings:–
Return on Investment (ROI):–
Understanding Solar Investment Returns
Installing solar panels is not just an environmental decision; it is a significant financial investment. Just like stocks or real estate, a solar energy system has an upfront cost and generates returns over time in the form of avoided utility bills. This Solar Panel ROI Calculator helps homeowners determine if the math makes sense for their specific situation.
How Solar ROI is Calculated
Return on Investment (ROI) for solar measures the total profit you make from your system over its lifespan compared to the initial cost. The formula generally involves:
Gross System Cost: The price you pay the installer.
Incentives: The Federal Investment Tax Credit (ITC) allows you to deduct 30% of the installation cost from your federal taxes (valid through 2032).
Energy Production: How many kilowatt-hours (kWh) your system generates, determined by the system size (kW) and local peak sun hours.
Utility Rates: The higher your current electricity rate ($/kWh), the higher your savings.
What is the Payback Period?
The "Payback Period" is the time it takes for your cumulative energy savings to equal the net cost of the system. For most US homeowners, this ranges between 6 to 9 years. Once the payback period is reached, the electricity generated by the system is effectively free profit for the remainder of the panels' life (typically 25+ years).
Key Inputs Explained
System Size (kW): The total capacity of your panels. An average US home typically needs a 6kW to 10kW system.
Peak Sun Hours: This is not the total hours of daylight, but the equivalent number of hours where the sun intensity is 1,000 watts per square meter. In the US, this ranges from 3.5 (Northeast) to 5.5+ (Southwest).
Electricity Price Inflation: Utility rates historically rise over time. A conservative estimate is 3% annually, though recent years have seen sharper increases.
Maximizing Your Investment
To get the best ROI, ensure your roof has southern exposure with minimal shading. Additionally, take advantage of the 30% Federal Tax Credit immediately after installation. Some states and local utilities offer additional rebates (SRECs) which can further reduce the payback period calculated above.