Solar Panel ROI Calculator

Model residential solar end-to-end:  size (kW) × insolation → kWh → savings → payback & return · education estimate, not a guarantee

System Config OFF
Generation OFF
Savings OFF
Investment OFF
Payback & Return OFF

System Configuration

The array is sized in kW DC. Insolation here is the specific yield of the location: the kWh a 1 kW array produces in one year at that site's sun resource. Region presets are typical all-in yields (weather, orientation, tilt); for a site-specific figure choose Custom.

annual generation (kWh)
   = system size (kW) × insolation (kWh/kW/yr)
  • System size — nameplate DC rating of the panels.
  • Insolation — resource + exposure; sunnier regions yield more per kW.

This is the first link in the derivation chain: size → kWh → dollars. No rule-of-thumb dollar shortcuts are used.

Generation & Degradation

Panels lose output every year. Each operating year multiplies the first-year generation by the degradation factor, so later years generate a little less and save a little less dollars.

G₁ = size × insolation
Gₗ = G₁ × (1 − deg/yr)⁻¹
  • Usage offset % — the share of the home's annual consumption the array is sized to cover; the tool derives implied consumption from it.
  • Degradation — typical module warranty is ~0.25–0.5%/yr.

Savings & Billing

Savings is the value of each kWh the array produces. A kWh self-consumed offsets a bill at the retail rate; a kWh exported is valued at the net-metering or export-credit rate.

savings = self-used kWh × rate
       + exported kWh × export credit
  • Retail net metering — exports credited at the retail rate.
  • Net billing / export — exports credited at a separate (often lower) rate.
  • When usage offset ≤ 100%, all output is self-consumed.

Investment & Cash Outflows

Installed cost can be entered as a total or as $/watt (total = $/W × kW × 1000). The federal-style tax credit reduces net outlay; a mid-life inverter swap adds a one-time outflow.

net cost = installed cost × (1 − credit%)
year Y cash flow = savingsₗ − inverter cost
  • Incentive / tax credit — applied as a % of gross installed cost.
  • Inverter replacement — one-time cost in the chosen operating year (only applies inside the system life).
  • System life — the analysis horizon in years.
  • Discount rate — personal hurdle used for the NPV calc.

Payback, ROI & IRR

Simple payback finds the year when the cumulative (undiscounted) cash flow turns positive. ROI is lifetime net gain vs net outlay. IRR is the discount rate that zeroes the present value of all cash flows.

payback = first yr where Σ cash flow ≥ 0
ROI  = (net gain − net cost) / net cost
IRR  = r where Σ CFₗ / (1+r)ₗ = 0
  • A green result means the system recovers its cost inside its life.
  • Estimates depend on rate, resource, and cost assumptions.
☀️ System & Generation
Typical specific yield presets
The kWh a 1 kW array yields per year at this site
💰 Billing & Consumption
Share of the home's yearly electricity the array covers
Implied annual usage—
📦 Cost, Incentives & Outlays
Typical residential range ~$2.50–$4.00/W
Net cash outlay—
📈 Return Model
Education estimate, not a guarantee. Output depends on real-world weather, shading, inverter losses, wear, local rates and rate inflation, and maintenance. Verify with a site-level proposal before financing.
Year Generation kWh Self-used kWh Exported kWh Savings Cash Flow Cumulative CF
Cumulative Cash Flow — undiscounted $ over system life
Cumulative cash flow Payback crossing