Calculate your estimated payback period and 25-year energy savings.
Net Installation Cost (After Tax Credit):$0.00
Estimated Annual Savings:$0.00
Payback Period (Break-even):0 Years
Total 25-Year Net Profit:$0.00
Understanding Your Solar Return on Investment (ROI)
Investing in solar panels is one of the most effective ways to reduce your carbon footprint while locking in long-term financial returns. But how do you determine if the upfront cost is worth it for your specific home?
How the Calculation Works
This calculator uses four primary data points to estimate your financial performance:
Net Cost: We take your total installation price and subtract the Federal Investment Tax Credit (ITC), which is currently 30% for systems installed through 2032.
Annual Savings: We estimate that a properly sized solar system will offset roughly 90-100% of your monthly electric bill.
Payback Period: This is the "break-even" point—the number of years it takes for your cumulative energy savings to equal the initial net cost of the system.
25-Year Profit: Most solar panels are warrantied for 25 years. This figure represents your total savings minus the initial investment.
Example Calculation
Imagine a typical U.S. home with a $150 monthly electric bill. If you install a 6kW system for $20,000:
Federal Tax Credit: You receive a $6,000 credit (30%), making your net cost $14,000.
Annual Savings: Saving $150/month equals $1,800 per year.
Payback Period: $14,000 divided by $1,800 results in a payback period of approximately 7.7 years.
Long-term Wealth: Over 25 years, you save $45,000 in electricity. After subtracting the $14,000 investment, your net profit is $31,000.
Key Factors Influencing ROI
While this calculator provides a strong estimate, several variables can accelerate your ROI:
Local Utility Rates: If your utility company increases rates (typically 2-4% annually), your solar savings actually increase every year.
Sunlight Exposure: Homes in Arizona or California will generate more kWh per panel than those in cloudy regions, leading to faster payback.
Net Metering: This policy allows you to send excess energy back to the grid for credit, effectively using the grid as a free battery.
function calculateSolarROI() {
var monthlyBill = parseFloat(document.getElementById('solar_bill').value);
var totalCost = parseFloat(document.getElementById('solar_cost').value);
var systemSize = parseFloat(document.getElementById('solar_size').value);
var taxCreditPercent = parseFloat(document.getElementById('solar_credit').value);
if (isNaN(monthlyBill) || isNaN(totalCost) || isNaN(systemSize) || isNaN(taxCreditPercent)) {
alert("Please enter valid numeric values in all fields.");
return;
}
// Logic 1: Calculate Net Cost after Tax Credit
var taxCreditAmount = totalCost * (taxCreditPercent / 100);
var netCost = totalCost – taxCreditAmount;
// Logic 2: Calculate Annual Savings
// We assume the system offsets the bill. In a realistic scenario,
// we use the bill as the baseline for savings.
var annualSavings = monthlyBill * 12;
// Logic 3: Payback Period
var paybackYears = netCost / annualSavings;
// Logic 4: 25-Year Total Profit
// Simplified: Total Savings over 25 years – initial net investment
var total25Savings = annualSavings * 25;
var netProfit = total25Savings – netCost;
// Display Results
document.getElementById('res_net_cost').innerText = "$" + netCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res_annual_savings').innerText = "$" + annualSavings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('res_payback').innerText = paybackYears.toFixed(1) + " Years";
document.getElementById('res_total_profit').innerText = "$" + netProfit.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
// Show the box
document.getElementById('solar_results').style.display = 'block';
}