Interest Rate Calculator Mortgage

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Solar Panel ROI & Payback Calculator

Your Financial Breakdown

Net System Cost:

Estimated Payback Period: Years

Year 1 Savings:

25-Year Total Savings:

25-Year Net Profit:

Annual ROI:

function calculateSolarROI() { var size = parseFloat(document.getElementById('systemSize').value); var cost = parseFloat(document.getElementById('systemCost').value); var rate = parseFloat(document.getElementById('elecRate').value); var hours = parseFloat(document.getElementById('sunHours').value); var credit = parseFloat(document.getElementById('taxCredit').value); var hike = parseFloat(document.getElementById('utilityHike').value) / 100; if (isNaN(size) || isNaN(cost) || isNaN(rate) || isNaN(hours)) { alert('Please enter valid numerical values.'); return; } var netCost = cost * (1 – (credit / 100)); // Annual Production (kWh) = Size * Daily Sun Hours * 365 days * 0.78 (Efficiency Factor) var annualProduction = size * hours * 365 * 0.78; var year1Savings = annualProduction * rate; var totalSavings = 0; var currentRate = rate; var yearsToPayback = 0; var cumulativeSavings = 0; var paybackFound = false; for (var i = 1; i = netCost) { yearsToPayback = i – 1 + ((netCost – (cumulativeSavings – yearlySaving)) / yearlySaving); paybackFound = true; } currentRate *= (1 + hike); } var netProfit = totalSavings – netCost; var annualROI = (netProfit / netCost / 25) * 100; document.getElementById('resNetCost').innerText = '$' + netCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('resPayback').innerText = yearsToPayback.toFixed(1); document.getElementById('resYear1').innerText = '$' + year1Savings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('resTotalSavings').innerText = '$' + totalSavings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('resProfit').innerText = '$' + netProfit.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('resROI').innerText = annualROI.toFixed(2) + '%'; document.getElementById('solar-results').style.display = 'block'; }

Understanding Solar ROI: Is Solar Worth It in 2024?

Investing in solar panels is more than an environmental choice; it is a long-term financial strategy. By generating your own power, you essentially hedge against rising utility costs. The "Return on Investment" (ROI) for solar determines how quickly the system pays for itself and how much profit it generates over its 25 to 30-year lifespan.

Key Factors in Solar Calculations

  • Solar Tax Credits (ITC): The Federal Investment Tax Credit currently allows you to deduct 30% of your solar installation costs from your federal taxes, significantly lowering the "Net Cost."
  • Peak Sun Hours: This isn't just daylight. It refers to the intensity of sunlight. Areas like Arizona might see 6 hours, while the Pacific Northwest might see 3.5.
  • System Degradation: Solar panels lose a tiny bit of efficiency every year (usually 0.5%). Our calculator accounts for this to ensure realistic long-term projections.
  • Utility Rate Inflation: Historically, electricity rates rise by 2-4% annually. As electricity becomes more expensive, your solar savings actually increase.

Example Calculation

Imagine a homeowner in Florida installing a 7kW system at a gross cost of $21,000. After the 30% federal tax credit, the net cost drops to $14,700. If the local electricity rate is $0.14/kWh and they get 5 sun hours a day, the system would produce roughly 10,000 kWh per year.

This results in roughly $1,400 in savings during the first year. With utility rates rising, the payback period would likely be between 8 to 10 years, leaving 15+ years of "free" electricity.

How to Use This Calculator

To get the most accurate results, look at your last 12 months of utility bills to find your average Price per kWh. Check your installer's quote for the System Size (kW) and the Total Cost before any incentives. Most modern systems assume an 80% efficiency factor due to inverter loss and wiring, which we have factored into our "0.78" production constant.

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