function calculateSolarPayback() {
var systemCost = parseFloat(document.getElementById('systemCost').value) || 0;
var taxCreditPct = parseFloat(document.getElementById('taxCredit').value) || 0;
var rebates = parseFloat(document.getElementById('rebates').value) || 0;
var monthlyBill = parseFloat(document.getElementById('monthlyBill').value) || 0;
var offset = parseFloat(document.getElementById('offset').value) || 0;
var inflation = (parseFloat(document.getElementById('inflation').value) || 0) / 100;
// Calculations
var taxCreditAmount = systemCost * (taxCreditPct / 100);
var netCost = systemCost – taxCreditAmount – rebates;
var firstYearSavings = (monthlyBill * 12) * (offset / 100);
// Dynamic Payback Calculation (accounting for inflation)
var cumulativeSavings = 0;
var years = 0;
var currentYearSavings = firstYearSavings;
var total25YearSavings = 0;
for (var i = 1; i <= 25; i++) {
cumulativeSavings += currentYearSavings;
total25YearSavings += currentYearSavings;
if (cumulativeSavings < netCost) {
years = i;
}
currentYearSavings *= (1 + inflation);
}
// Refine fractional years
var remainingCostAfterFullYears = netCost – (cumulativeSavings – (currentYearSavings / (1 + inflation)));
var fractionalYear = 0;
if (years < 25) {
var lastYearSavings = currentYearSavings / Math.pow((1 + inflation), (25 – years));
// This is an approximation for the specific year the payback happens
var savingsInPaybackYear = firstYearSavings * Math.pow((1+inflation), years);
var remainingAtYearStart = netCost;
var runningTotal = 0;
var preciseYears = 0;
var tempSavings = firstYearSavings;
for(var j = 1; j = netCost) {
preciseYears = (j – 1) + ((netCost – runningTotal) / tempSavings);
break;
}
runningTotal += tempSavings;
tempSavings *= (1 + inflation);
}
}
var roi = ((total25YearSavings – netCost) / netCost) * 100;
// Display results
document.getElementById('resultsArea').style.display = 'block';
document.getElementById('netCostDisplay').innerText = '$' + netCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('paybackDisplay').innerText = preciseYears.toFixed(1) + ' Years';
document.getElementById('totalSavingsDisplay').innerText = '$' + total25YearSavings.toLocaleString(undefined, {minimumFractionDigits: 0, maximumFractionDigits: 0});
document.getElementById('roiDisplay').innerText = roi.toFixed(1) + '%';
}
How Does the Solar Payback Period Work?
The solar panel payback period is the amount of time it takes for the electricity bill savings generated by your solar energy system to equal the initial cost of installing the system. For most homeowners in the United States, this typically ranges between 6 and 10 years.
Key Factors Influencing Your ROI
Total Installation Cost: This includes panels, inverters, mounting hardware, and labor. The gross cost is often significantly reduced by incentives.
The Federal Investment Tax Credit (ITC): As of 2024, the federal government offers a 30% tax credit on the total cost of solar installations, which directly reduces your net investment.
Local Utility Rates: The more you pay for electricity per kilowatt-hour (kWh), the faster your solar panels will pay for themselves.
SREC and Performance Incentives: Some states offer Solar Renewable Energy Certificates or performance-based incentives that provide ongoing cash payments for the energy you produce.
Net Metering: This policy allows you to send excess energy back to the grid in exchange for credits on your bill, maximizing your monthly savings.
Calculation Example
Imagine you install a system for $20,000.
After a 30% Federal Tax Credit ($6,000) and a $1,000 state rebate, your net cost is $13,000.
If your solar panels save you $150 per month ($1,800 per year), your simple payback period would be $13,000 / $1,800 = 7.2 years.
However, since utility rates usually rise by about 2-3% annually, your real payback period will likely be even shorter.
Is Solar a Good Investment?
Beyond the payback period, solar panels are generally warranted for 25 years. If your system pays for itself in 8 years, you will enjoy 17+ years of essentially "free" electricity. Furthermore, studies by Zillow and the Lawrence Berkeley National Laboratory have shown that solar installations can increase property values by an average of 4.1%.