function calculateSolarROI() {
var cost = parseFloat(document.getElementById('solarCost').value);
var incentives = parseFloat(document.getElementById('solarIncentives').value);
var size = parseFloat(document.getElementById('solarSize').value);
var rate = parseFloat(document.getElementById('electricRate').value);
if (isNaN(cost) || isNaN(incentives) || isNaN(size) || isNaN(rate) || cost <= 0) {
alert("Please enter valid numbers for all fields.");
return;
}
var netCost = cost – incentives;
// Standard calculation: kW * 1450 (avg sunlight hours in US) * 0.85 (system efficiency)
var annualProduction = size * 1450 * 0.85;
var annualSavings = annualProduction * rate;
var paybackPeriod = netCost / annualSavings;
// 25-year profit calculation accounting for 0.5% panel degradation annually
var totalSavings25Years = 0;
var currentProduction = annualProduction;
for (var i = 1; i <= 25; i++) {
totalSavings25Years += (currentProduction * rate);
currentProduction *= 0.995; // 0.5% degradation
}
var netProfit = totalSavings25Years – netCost;
document.getElementById('resNetCost').innerText = "$" + netCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resAnnualKwh').innerText = Math.round(annualProduction).toLocaleString() + " kWh";
document.getElementById('resAnnualSavings').innerText = "$" + annualSavings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resPayback').innerText = paybackPeriod.toFixed(1) + " Years";
document.getElementById('resTotalProfit').innerText = "$" + netProfit.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('solar-results').style.display = 'block';
}
Understanding Your Solar ROI
Investing in solar energy is one of the most effective ways for homeowners to increase property value while slashing monthly utility expenses. To determine if solar panels are worth it for your specific situation, you must evaluate the Payback Period—the amount of time it takes for your utility savings to cover the initial out-of-pocket cost of the system.
Key Factors in the Calculation
The Federal Investment Tax Credit (ITC): Currently, the US federal government offers a 30% tax credit on the total cost of solar installation. This is applied directly to your tax liability.
Insolation (Sunlight Hours): Systems in Arizona or California produce more electricity than the same-sized system in Washington or Maine due to higher peak sun hours.
Utility Rates: The higher your current electricity rate ($ per kWh), the more money you save every month, which accelerates your Return on Investment.
Degradation: Solar panels lose a tiny bit of efficiency every year (typically 0.5%). Our calculator factors this in for the 25-year profit estimate.
Solar ROI Example
Metric
6kW System (Avg)
10kW System (Large)
Gross Cost
$18,000
$28,000
30% Tax Credit
-$5,400
-$8,400
Net Investment
$12,600
$19,600
Avg. Payback
7.5 Years
6.8 Years
Is Solar a Good Investment?
Most residential solar systems provide an internal rate of return (IRR) between 10% and 20%, which significantly outperforms the stock market's historical average. Beyond the financial gains, you are hedging against future energy inflation. While utility companies raise rates by 2-4% annually, your solar fuel cost is locked in at $0.00 for the life of the system.