Solar Panel Savings Calculator
See how much a rooftop solar system produces, what it saves on your electric bill, and how many years it takes to pay for itself.
How it works
Annual kWh = size(kW) × sun-hours × 365 × 0.80 · Savings = kWh × price · Net cost = cost × (1 − credit%) · Payback = net cost ÷ annual savings
A solar array’s yearly output is its rated kilowatts times the daily peak sun-hours for your location, times 365 days, scaled by a performance ratio near 0.8 that accounts for inverter, wiring, heat and soiling losses. Multiplying production by your electricity price gives the annual bill offset. Payback compares that yearly saving against the system cost after any tax credit or rebate; the 25-year figure reflects a typical panel warranty period, using today’s rates as a simple baseline.
Worked example
A 6 kW system at 4.5 sun-hours makes 6 × 4.5 × 365 × 0.8 ≈ 7,884 kWh a year. At $0.17/kWh that saves about $1,340. A $18,000 install less a 30% credit is $12,600 net, so payback is 12,600 ÷ 1,340 ≈ 9.4 years, and 25 years of savings net roughly $20,900.
Frequently asked questions
What are peak sun-hours?
Peak sun-hours are the equivalent hours per day of full 1,000 W/m² sunlight your location receives on average. Most of the US falls between about 4 and 5.5; sunny southwestern states are higher, cloudy northern ones lower.
Why the 0.8 performance ratio?
Panels never deliver their nameplate rating in the field. Inverter conversion, wiring resistance, high-temperature derating, dust and shading typically cost 15–25%, so 0.8 is a realistic real-world factor.
Does this account for rising electricity prices?
No — it holds today’s rate flat, which is conservative. Since utility rates historically climb, real payback is often a bit faster and lifetime savings larger than this baseline shows.
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This calculator is for educational purposes. Double-check important results before acting on them.