Estimate your savings and payback period for a residential solar installation.
Estimated Investment Analysis
Recommended System Size:0 kW
Gross Installation Cost:$0
Net Cost (After Tax Credit):$0
Annual Savings (Year 1):$0
Estimated Payback Period:0 Years
25-Year Total Net Profit:$0
How to Calculate Your Solar Return on Investment
Switching to solar energy is a major financial decision. Understanding your Solar ROI (Return on Investment) helps you determine if the upfront cost of solar panels will be offset by long-term energy savings. Most homeowners in the United States see a payback period between 6 and 10 years, but this varies based on location and local incentives.
Key Factors Influencing Your Solar Payback
Peak Sun Hours: This isn't just daylight; it's the amount of time the sun's intensity is sufficient to generate maximum power. Southwestern states typically see 6+ hours, while Northern states may see 3.5 to 4.
Local Electricity Rates: The more your utility company charges per kilowatt-hour (kWh), the more you save by generating your own power.
The Federal Solar Tax Credit (ITC): Currently, the federal government allows you to deduct 30% of your solar installation costs from your federal taxes, significantly reducing the "Net Cost."
System Size: A larger system costs more initially but offers higher total savings. The calculator estimates your system size based on your monthly bill to target "Net Zero" energy consumption.
Realistic ROI Example
Suppose you spend $150 a month on electricity at a rate of $0.14 per kWh. In a region with 5 peak sun hours, you would likely need a 7.5 kW system. At $3.00 per watt, the gross cost is $22,500. After applying the 30% Federal Tax Credit, your net cost drops to $15,750. With annual savings of roughly $1,800, your system pays for itself in about 8.7 years.
function calculateSolarROI() {
// Get Inputs
var monthlyBill = parseFloat(document.getElementById('monthlyBill').value);
var rate = parseFloat(document.getElementById('electricityRate').value);
var sunHours = parseFloat(document.getElementById('sunHours').value);
var costPW = parseFloat(document.getElementById('installCost').value);
var taxCredit = parseFloat(document.getElementById('taxCredit').value);
var degradation = parseFloat(document.getElementById('degradation').value) / 100;
// Validation
if (isNaN(monthlyBill) || isNaN(rate) || isNaN(sunHours) || isNaN(costPW)) {
alert("Please enter valid numbers in all fields.");
return;
}
// 1. Calculate Required System Size (kW)
// Formula: (Monthly kWh / 30 days) / sun hours / 0.75 efficiency factor
var monthlyKwh = monthlyBill / rate;
var systemSizeKw = (monthlyKwh / 30) / sunHours / 0.75;
// 2. Financials
var grossCost = (systemSizeKw * 1000) * costPW;
var netCost = grossCost * (1 – (taxCredit / 100));
var yearOneSavings = monthlyBill * 12;
// 3. Payback Period and 25 Year Profit (Simulating degradation and 3% utility inflation)
var currentSavings = 0;
var totalSavings25 = 0;
var years = 0;
var paybackYear = 0;
var tempRate = rate;
var tempProduction = yearOneSavings;
for (var i = 1; i = netCost && paybackYear === 0) {
paybackYear = i – 1 + ((netCost – (totalSavings25 – tempProduction)) / tempProduction);
}
// Adjust for next year: utility rates go up ~3%, panels degrade
tempProduction = tempProduction * (1 – degradation) * 1.03;
}
var netProfit = totalSavings25 – netCost;
// Display Results
document.getElementById('solarResult').style.display = 'block';
document.getElementById('resSystemSize').innerText = systemSizeKw.toFixed(2) + " kW";
document.getElementById('resGrossCost').innerText = "$" + grossCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resNetCost').innerText = "$" + netCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resAnnualSavings').innerText = "$" + yearOneSavings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
if (paybackYear > 0 && paybackYear <= 25) {
document.getElementById('resPayback').innerText = paybackYear.toFixed(1) + " Years";
} else {
document.getElementById('resPayback').innerText = "Over 25 Years";
}
document.getElementById('resProfit').innerText = "$" + netProfit.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
// Scroll to results
document.getElementById('solarResult').scrollIntoView({ behavior: 'smooth', block: 'nearest' });
}