function calculateSolarROI() {
var size = parseFloat(document.getElementById('systemSize').value);
var costWatt = parseFloat(document.getElementById('costPerWatt').value);
var rate = parseFloat(document.getElementById('utilityRate').value);
var sun = parseFloat(document.getElementById('sunHours').value);
var credit = parseFloat(document.getElementById('taxCredit').value);
var deg = parseFloat(document.getElementById('degradation').value) / 100;
if (isNaN(size) || isNaN(costWatt) || isNaN(rate) || isNaN(sun)) {
alert('Please enter valid numbers in all fields.');
return;
}
var grossCost = size * 1000 * costWatt;
var netCost = grossCost * (1 – (credit / 100));
// Annual generation (Loss factor of 14% for inverter/wiring/dirt is industry standard)
var annualGen = size * sun * 365 * 0.86;
var year1Savings = annualGen * rate;
// Payback Period (Simplified linear)
var payback = netCost / year1Savings;
// 25 Year Outlook
var totalSavings = 0;
var currentGen = annualGen;
var electricityInflation = 0.03; // Utility rates usually go up 3% per year
var currentRate = rate;
for (var i = 0; i < 25; i++) {
totalSavings += (currentGen * currentRate);
currentGen *= (1 – deg);
currentRate *= (1 + electricityInflation);
}
var netProfit = totalSavings – netCost;
var roiPercent = (netProfit / netCost) * 100;
document.getElementById('resNetCost').innerText = '$' + netCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resGeneration').innerText = Math.round(annualGen).toLocaleString();
document.getElementById('resYear1Savings').innerText = '$' + year1Savings.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resPayback').innerText = payback.toFixed(1) + ' Years';
document.getElementById('resProfit').innerText = '$' + netProfit.toLocaleString(undefined, {minimumFractionDigits: 0, maximumFractionDigits: 0});
document.getElementById('resROI').innerText = roiPercent.toFixed(1) + '%';
document.getElementById('solar-results').style.display = 'block';
}
Understanding Your Solar Return on Investment
Switching to solar power is one of the most significant financial decisions a homeowner can make. Unlike traditional home improvements, solar panels act as a financial asset that yields a measurable monthly return through avoided utility costs.
How the Solar Payback Period is Calculated
The solar payback period is the time it takes for the cumulative energy savings to equal the initial cost of the system. To find this, we take the Net System Cost (Gross cost minus tax credits and rebates) and divide it by your Annual Electricity Savings.
Factors that speed up your payback period include:
High Electricity Rates: If your utility charges $0.20/kWh instead of $0.10, your panels "earn" money twice as fast.
Local Incentives: State-level rebates or SRECs (Solar Renewable Energy Certificates) can shave years off the break-even point.
Sun Exposure: A roof in Arizona will reach ROI significantly faster than one in Washington due to the total photon counts.
Example Scenario: A Standard 6kW System
Let's look at a realistic example for a medium-sized home:
Metric
Value
Gross System Cost (6kW @ $3/W)
$18,000
Federal Tax Credit (30%)
-$5,400
Net Investment
$12,600
Est. Annual Savings
$1,500
Payback Period
8.4 Years
The Long-Term ROI (25 Years)
Most modern solar panels are warrantied for 25 years. After your payback period (typically year 7 to 10), the electricity generated is essentially free. When you factor in the rising cost of utility electricity (historically 2-4% per year), the "avoided cost" becomes even more valuable over time. This leads to internal rates of return (IRR) that often outperform the stock market with much lower risk.