How to use it
Pick your state. The electricity price fills in from the U.S. Energy Information Administration (EIA). It is the average residential price for January to July 2026. Then enter your system size and the price per watt from your quote. Pick how sunny it is where you live.
For a better estimate, copy two numbers from your own bill and quote:
- Electricity price: your total bill ÷ the kWh you used.
- Yearly output per kW: your installer's production estimate ÷ the system size. You can also get it for your exact roof from NREL's free PVWatts calculator.
The formula
- Cost = size in watts × price per watt − rebates
- Savings in year one = size × yearly output per kW × electricity price
- Each later year, electricity costs 3% more (you can change this), and the panels make 0.5% less as they age.
- Payback is the year your total savings pass the cost.
Example: a 7 kW system at $3.00 a watt costs $21,000. At 1,450 kWh per kW, it makes 10,150 kWh in year one. At the U.S. average of 18.19¢ that saves $1,846.29 in year one. The panels pay for themselves in about 10.1 years. Over 25 years they save about $41,943 more than they cost.
Common questions
Is there still a 30% federal solar tax credit?
Not for panels you buy. The One Big Beautiful Bill Act ended the Residential Clean Energy Credit (Section 25D) for systems installed after December 31, 2025. Leases and power purchase agreements can still carry a federal credit, but the company that owns the panels claims it, not you. Many states and utilities still offer their own rebates. Enter those in the rebates box.
What is a good payback period?
Under 10 years is good. Most panels carry a 25-year warranty, so anything under about 12 years usually leaves many years of free power. States with expensive electricity, like California, Hawaii and the Northeast, pay back fastest.
Does net metering change this?
Yes. This calculator assumes every kWh your panels make is worth the full retail price. If your utility pays less for power you send back to the grid, as California's net billing does, your real savings are lower unless you add a battery or use most of the power yourself.
What does solar cost per watt?
Most US home systems are quoted between $2.50 and $3.50 a watt before incentives. Get at least three quotes.
Last checked: 2026-09-26