Solar ROI Calculator
See how much your solar investment can earn over 25 years. Adjust the inputs to match your quote.
Typical range: 1,000–1,800 depending on location
Modern panels degrade 0.3–0.7% per year
Historical average: 2–3% per year
Add federal, state, or utility incentives you qualify for. Note: the federal residential clean energy credit ended for systems placed in service after Dec 31, 2025.
Your Solar ROI Summary
Gross Cost
$16,800
After Incentives
$10,800
Year 1 Savings
$1,008
25-Year Savings
$31,035
25-Year ROI
187%
Payback Period
10 years
Year-by-Year Savings
| Year | Production (kWh) | Rate ($/kWh) | Savings | Cumulative |
|---|---|---|---|---|
| 1 | 8,400 | $0.120 | $1,008 | $1,008 |
| 2 | 8,358 | $0.123 | $1,025 | $2,033 |
| 3 | 8,316 | $0.125 | $1,042 | $3,075 |
| 4 | 8,275 | $0.128 | $1,060 | $4,135 |
| 5 | 8,233 | $0.131 | $1,078 | $5,213 |
| 6 | 8,192 | $0.134 | $1,096 | $6,309 |
| 7 | 8,151 | $0.137 | $1,115 | $7,424 |
| 8 | 8,110 | $0.140 | $1,133 | $8,557 |
| 9 | 8,070 | $0.143 | $1,153 | $9,710 |
| 10 | 8,029 | $0.146 | $1,172 | $10,882 |
Showing years 1–10. Panels typically last 25+ years.
How Solar ROI Works
Solar panels are a long-term investment. The ROI calculation compares your total 25-year electricity savings against the net cost of installation after incentives. Key factors that drive ROI include your local electricity rates, the amount of sunlight your location receives, and available tax credits or rebates.
The federal Investment Tax Credit (ITC) covered 30% of installation costs for systems placed in service through 2025. Many states and utilities offer additional incentives that can reduce your net cost by thousands of dollars. Combined with net metering programs that credit you for excess energy sent to the grid, solar panels can deliver an ROI of 15–35% over their 25-year lifespan in most markets. Your actual return depends on local electricity rates, sunlight, system cost, and available incentives.
Your system's ROI is also affected by panel orientation and tilt. Panels installed at the optimal angle can produce 10–40% more energy than flat-mounted panels — depending on latitude and mounting constraints — directly improving your return.
Related Calculators
Solar Tilt Calculator
Find the optimal tilt angle for your panels
Solar Azimuth Calculator
Find the optimal compass direction for your panels
Solar Payback Calculator
See how fast your solar panels pay for themselves
Solar Production Calculator
Estimate how much energy your system will generate
Written by SolarAlign Engineering·Updated September 2026
Methodology: NOAA-based solar geometry, typical peak sun hours, and standard system-loss assumptions. Read the full methodology
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