Solar Payback Calculator

Solar payback period and 25-year savings with price inflation.

Solar Payback Calculator

Worked example result

Net cost after incentives	$14,000
Annual savings (year 1)	$1,920.00
Simple payback period	7.3 years
Total savings over 25 years	$70,002
Net savings over 25 years (after net cost)	$56,002

A $20,000 system with $6,000 of incentives nets $14,000; offsetting 80% of a $2,400 bill saves $1,920 a year, paying back in about 7.3 years and saving about $70,002 over 25 years at 3% price inflation.

Enter the installed cost of a solar system, any incentives or rebates, your annual electricity bill and the share of that bill the system will offset. The calculator returns the net cost, first-year savings and the simple payback period.

The 25-year figure grows your annual savings each year by the electricity price inflation you enter, since every kilowatt-hour you generate avoids buying power at future prices. It is a simple-payback estimate: it excludes maintenance, financing costs, panel degradation and any export payments, so treat it as a planning guide.

The formula

Net cost = Cost − incentives; Annual savings = Bill × offset%; Payback = Net cost ÷ annual savings

Worked example

The example is pre-loaded in the result panel — press Calculate with your own numbers to replace it.

Frequently asked questions

What payback period is typical?

US residential systems commonly pay back in roughly 6–12 years depending on local electricity prices, sun exposure and incentives, then generate mostly free power for the rest of a 25-year-plus panel life.

Why does electricity price inflation change the result so much?

Savings compound: at 3% yearly inflation the bill you avoid in year 25 is about double today's. Over 25 years that growth adds tens of thousands of dollars compared with flat prices.

Category: Everyday Life calculators

Solar Payback Calculator