Solar Panel Payback Calculator

Calculate how many years solar panels take to pay for themselves, with the share you use yourself, what you export and the decline in output.

System cost

What you pay, including installation and after any grant, rebate or tax credit.

Output per year (kWh)

The expected output from the quote. It depends a lot on where you live and the roof.

Used yourself (%)

Which share of the generated electricity you use directly. Without a battery often 25 to 35%.

Electricity price per kWh

What you would otherwise pay for electricity, including taxes: about 18 cents per kWh on average in the US.

Export rate per kWh

What you get for electricity you export. With full net metering it equals your electricity price; with net billing it is usually lower. If you pay to export, enter a negative amount.

Decline per year (%)

Panels produce a little less every year, often around 0.5%.

Lifespan (years)

Often 25 years or more.

Pays for itself after

15 years and 2 months

Saving in the first year

$1,890.00

Saving over the lifespan

$44,521

Net result

$16,821

Return in the first year

6.8 %

Savings against the investment

Total savings
Investment

Show the table

Year	Total savings	Investment
0	$0	$27,700
1	$1,890	$27,700
2	$3,771	$27,700
3	$5,642	$27,700
4	$7,503	$27,700
5	$9,356	$27,700
6	$11,199	$27,700
7	$13,033	$27,700
8	$14,858	$27,700
9	$16,674	$27,700
10	$18,480	$27,700
11	$20,278	$27,700
12	$22,067	$27,700
13	$23,846	$27,700
14	$25,617	$27,700
15	$27,379	$27,700
16	$29,132	$27,700
17	$30,876	$27,700
18	$32,612	$27,700
19	$34,339	$27,700
20	$36,057	$27,700
21	$37,767	$27,700
22	$39,468	$27,700
23	$41,161	$27,700
24	$42,845	$27,700
25	$44,521	$27,700

Please note: This is an example calculation, not financial advice. Personal circumstances, changes in rules and rates, and additional costs are not included. If in doubt, talk to a financial adviser.

Changing electricity prices, maintenance, a new inverter and taxes are not included.

How this number is calculated

The blocks use your input. Change a value above and they update with it.

Step 1 · Used yourself

Output per year (kWh)10,500 × Used yourself (%)30 ÷ Per100 =Used yourself3,150 kWh

Step 2 · Exported

Output per year (kWh)10,500 − Used yourself3,150 kWh =Exported7,350 kWh

Step 3 · Saving in the first year

Used yourself3,150 kWh × Electricity price per kWh$0.18 + Exported7,350 kWh × Export rate per kWh$0.18 =Saving in the first year$1,890.00

Step 4 · Payback in years

(becauseDecline per year (as a fraction)0.005 does not equal 0 ) natural log of1 − System cost$27,700.00 × Decline per year (as a fraction)0.005 ÷ Saving in the first year$1,890.00 ÷ natural log of1 − Decline per year (as a fraction)0.005 =Payback in years15.18 years

Step 5 · Saving over the lifespan

(becauseDecline per year (as a fraction)0.005 does not equal 0 ) Saving in the first year$1,890.00 × 1 − power of1 − Decline per year (as a fraction)0.005 Lifespan (years)25 ÷ Decline per year (as a fraction)0.005 =Saving over the lifespan$44,521

Step 6 · Net result

Saving over the lifespan$44,521 − System cost$27,700.00 =Net result$16,821

How the calculation works

Calculate how many years solar panels take to pay for themselves. Enter the cost and the output, the share you use yourself and what you get for exporting, and see the payback period and the saving over the whole lifespan.

Electricity you use yourself does not have to be bought: it saves the full electricity price. For electricity you export, you get the export rate. Together that is the saving in the first year. Panels produce a little less every year, so the saving drops each year by the decline. The calculator adds up the savings and calculates when they have paid back the cost of the system.

Formula

Saving in year 1 = used yourself × electricity price + exported × export rate. With a decline d per year: total after t years = saving in year 1 × (1 − (1 − d)^t) ÷ d. Payback t = ln(1 − cost × d ÷ saving in year 1) ÷ ln(1 − d).

Assumptions

The electricity price and the export rate stay the same. If electricity gets more expensive, the panels pay back sooner.
The share you use yourself stays the same every year.
Maintenance and a new inverter are not included. An inverter often lasts 10 to 15 years; add its cost to the system cost if you want to include it.
Taxes and rebates are not included separately; enter the cost after any rebate or credit.
The payback period is rounded to whole months, amounts to whole units.

Example calculations

The button fills in the calculator above, so you can carry on from there.

Low export rate

Pays for itself after
14 years and 9 months

System cost $3,800.00 · Output per year (kWh) 3,800 · Used yourself (%) 30 · Electricity price per kWh $0.21 · Export rate per kWh $0.01 · Decline per year (%) 0.5 · Lifespan (years) 25
Using more yourself

Pays for itself after
7 years and 10 months

System cost $3,800.00 · Output per year (kWh) 3,800 · Used yourself (%) 60 · Electricity price per kWh $0.21 · Export rate per kWh $0.01 · Decline per year (%) 0.5 · Lifespan (years) 25
Large roof

Pays for itself after
11 years and 5 months

System cost $7,000.00 · Output per year (kWh) 7,000 · Used yourself (%) 40 · Electricity price per kWh $0.21 · Export rate per kWh $0.01 · Decline per year (%) 0.5 · Lifespan (years) 25

Frequently asked questions

What difference does net metering make?

With full net metering, every exported kWh is worth the full electricity price. With the default values, the panels then pay back after 5 years and 7 months, against 13 years and 0 months with a low export rate of 0.05 per kWh.

How can solar panels pay back faster?

By using more of the electricity while the sun shines, for example by running appliances or charging a car during the day, or with a home battery. With 60% used yourself instead of 30%, the payback with the default values drops to 8 years and 3 months.

What if I pay to export?

Some rate plans charge for exported electricity. If the export rate is below zero, enter a negative amount.

How much do solar panels produce?

It depends on where you live, the direction and tilt of the roof, and shade. Sunny southern states produce more per kWp than northern ones. The quote gives the expected output for your roof.

What if the payback is longer than the lifespan?

Then, with these assumptions, the system does not pay for itself within its lifespan and the net result is negative. Check whether you can use more yourself, whether the output is right, or whether the system can cost less.

Sources and checks

Sources

Optimizing Solar Photovoltaic Performance for Longevity | US DOE (FEMP) (opens in a new tab)energy.gov · accessed October 6, 2026
Electricity Monthly Update | U.S. Energy Information Administration (opens in a new tab)eia.gov · accessed October 6, 2026
Table 1.1.A. Net Generation from Renewable Sources: Total (All Sectors) | U.S. Energy Information Administration (opens in a new tab)eia.gov · accessed October 6, 2026
Table 6.1.A. Estimated Net Summer Solar Photovoltaic Capacity From Utility and Small Scale Facilities | U.S. Energy Information Administration (opens in a new tab)eia.gov · accessed October 6, 2026
Form EIA-861M (formerly EIA-826) detailed data | U.S. Energy Information Administration (opens in a new tab)eia.gov · accessed October 6, 2026
Residential Clean Energy Credit | Internal Revenue Service (opens in a new tab)irs.gov · accessed October 6, 2026
Lower compensation rates for residential solar PV generation could reduce overall adoption | U.S. Energy Information Administration (opens in a new tab)eia.gov · accessed October 6, 2026
U.S. Distributed Solar and Storage: 2026 Data Update | Berkeley Lab (opens in a new tab)emp.lbl.gov · accessed October 6, 2026

How we check it

This calculator has 12 fixed checks: 7 calculations with a result that is fixed in advance, and 5 cases of invalid input that must be rejected. They all run automatically every time we publish; if one fails, the calculator does not go live.

See the calculations

System cost $3,800.00 · Output per year (kWh) 3,800 · Used yourself (%) 30 · Electricity price per kWh $0.21 · Export rate per kWh $0.01 · Decline per year (%) 0.5 · Lifespan (years) 25 → Pays for itself after 14 years and 9 months
System cost $3,800.00 · Output per year (kWh) 3,800 · Used yourself (%) 30 · Electricity price per kWh $0.21 · Export rate per kWh $0.21 · Decline per year (%) 0.5 · Lifespan (years) 25 → Pays for itself after 4 years and 10 months
System cost $3,800.00 · Output per year (kWh) 3,800 · Used yourself (%) 60 · Electricity price per kWh $0.21 · Export rate per kWh $0.01 · Decline per year (%) 0.5 · Lifespan (years) 25 → Pays for itself after 7 years and 10 months
System cost $7,000.00 · Output per year (kWh) 7,000 · Used yourself (%) 40 · Electricity price per kWh $0.21 · Export rate per kWh $0.01 · Decline per year (%) 0.5 · Lifespan (years) 25 → Pays for itself after 11 years and 5 months
System cost $3,800.00 · Output per year (kWh) 3,800 · Used yourself (%) 30 · Electricity price per kWh $0.21 · Export rate per kWh $0.01 · Decline per year (%) 0 · Lifespan (years) 25 → Pays for itself after 14 years and 3 months
System cost $5,000.00 · Output per year (kWh) 3,500 · Used yourself (%) 30 · Electricity price per kWh $0.26 · Export rate per kWh $0.05 · Decline per year (%) 0.5 · Lifespan (years) 25 → Pays for itself after 13 years
System cost $12,000.00 · Output per year (kWh) 2,500 · Used yourself (%) 20 · Electricity price per kWh $0.25 · Export rate per kWh $0.02 · Decline per year (%) 0.5 · Lifespan (years) 20 → Pays for itself after 90 years and 2 months

Changes

October 6, 2026: Separate default values and sources for the UK and the US: system cost, output, electricity price and export rate.
October 5, 2026: First version. Defaults follow the Ofgem price cap (0.26 per kWh) and the Smart Export Guarantee (0.05); UK output figures from DESNZ. Sources added.

Last reviewed: October 6, 2026 · How we build and check our calculators