Estimate your potential savings and how long it will take for your solar energy system to pay for itself.
Net System Cost:
Estimated Annual Generation: kWh
Year 1 Utility Savings:
Estimated Payback Period: Years
25-Year Total Savings:
How to Calculate Your Solar Return on Investment
Deciding to switch to solar power is a significant financial decision. To understand the true ROI, you must look beyond the initial price tag and evaluate the long-term energy production versus your current utility costs.
Key Factors in Solar Math
System Size: Most residential systems range from 5kW to 10kW. The larger the system, the more energy you produce, but the higher the upfront cost.
Peak Sun Hours: This isn't just daylight; it's the intensity of the sun. States like Arizona have higher peak hours (approx 6.5) compared to Washington (approx 3.5).
Net Metering & Rates: Your savings depend on what your utility company charges per kilowatt-hour (kWh). If your utility allows net metering, you get credited for the excess energy you send back to the grid.
Incentives: The Federal Investment Tax Credit (ITC) currently allows you to deduct a significant percentage of your solar installation costs from your federal taxes.
Example Calculation
If you install a 6kW system at $3.00 per watt, your gross cost is $18,000. With a 30% federal tax credit, your net cost drops to $12,600. If that system produces 9,000 kWh per year and your electricity rate is $0.16/kWh, you save $1,440 annually. Your payback period would be roughly 8.75 years.
function calculateSolarROI() {
var size = parseFloat(document.getElementById("solarSystemSize").value);
var cost = parseFloat(document.getElementById("solarInstallCost").value);
var sunHours = parseFloat(document.getElementById("solarSunHours").value);
var rate = parseFloat(document.getElementById("solarUtilityRate").value);
var incentive = parseFloat(document.getElementById("solarTaxCredit").value);
var degradation = parseFloat(document.getElementById("solarDegradation").value) / 100;
if (isNaN(size) || isNaN(cost) || isNaN(sunHours) || isNaN(rate) || isNaN(incentive)) {
alert("Please enter valid numeric values in all fields.");
return;
}
// Calculation Logic
var netCost = cost * (1 – (incentive / 100));
// Efficiency factor (standard losses for inverter, wiring, dust) is roughly 0.78
var efficiencyFactor = 0.78;
var dailyGen = size * sunHours * efficiencyFactor;
var annualGen = dailyGen * 365;
var year1Savings = annualGen * rate;
// Payback Period Logic (Simplified linear estimate)
var paybackYears = netCost / year1Savings;
// 25-Year Projection with degradation
var totalSavings25 = 0;
var currentAnnualGen = annualGen;
for (var i = 1; i <= 25; i++) {
totalSavings25 += (currentAnnualGen * rate);
currentAnnualGen = currentAnnualGen * (1 – degradation);
}
var netProfit = totalSavings25 – netCost;
// Display Results
document.getElementById("resNetCost").innerText = "$" + netCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resAnnualGen").innerText = Math.round(annualGen).toLocaleString();
document.getElementById("resYear1Savings").innerText = "$" + year1Savings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resPayback").innerText = paybackYears.toFixed(1);
document.getElementById("res25YearSavings").innerText = "$" + totalSavings25.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("solar-result-box").style.display = "block";
}