Solar ROI Calculator
Calculate solar payback period, 25-year savings, and ROI for your state. Real EIA electricity rates, NREL PVWatts production, and state incentives — updated for 2026 (federal ITC expired).
How this calculator works
- Enter your state and monthly electricity usage, then set a system size — or use a preset. The calculator automatically pre-fills your state's average electricity rate and solar production.
- It computes your annual bill offset (self-consumption + export income + SREC income), gross and net system cost, payback period, 25-year net profit, and an approximate internal rate of return (IRR).
- Results assume 70% self-consumption by default, 3%/yr electricity rate escalation, and 0.5%/yr panel degradation — all adjustable to match your home.
Example scenarios
Typical 6 kW: A standard home system covering ~100% of average usage.
8 kW + EV: For homes with an EV or heat pump — 8 kW with the same 70% self-use.
Small home, high self-use: 5 kW with 85% self-consumption — maximizes bill offset in net-billing states.
Data & algorithm
- Annual production = system kW × state kWh-per-kW (NREL PVWatts v8).
- Annual savings = self-consumed kWh × rate + exported kWh × export credit + SREC income.
- Payback = net cost ÷ annual savings. Net cost = gross cost × 0.95 (conservative 5% average state-incentive offset).
- 25-year savings compound 3% rate escalation and 0.5% degradation per year.
Official data sources
- Electricity rates: EIA Electric Power Monthly Table 5.6.B (2026 YTD May).
- Solar production: NREL PVWatts v8 (state representative city).
- Incentives & SRECs: DSIRE database (2026) and state markets.
- Install cost: Lawrence Berkeley National Laboratory Tracking the Sun (2026 trend).
All figures dated 2026. Incentives and rates change — verify current values with your utility and the administering authority before making decisions.
Frequently asked questions
What is a good solar payback period?
Under 9 years is excellent, 9–13 is reasonable, and 13+ is long — only worth it with strong state incentives or 20+ years of ownership. Payback varies hugely by state because of electricity rates, sun, and net metering.
How accurate is this calculator?
It uses real 2026 data (EIA rates, NREL PVWatts production, DSIRE incentives) and standard industry formulas, but your actual results depend on your roof, shading, installer pricing, and financing. Treat it as a planning estimate, then get 3–5 written quotes.
Why did the federal tax credit disappear?
The 30% residential credit (Section 25D) expired December 31, 2025 under the One Big Beautiful Bill Act. Systems installed in 2026 are not eligible.