# Solar Panel Savings Calculator

Estimate solar panel savings based on your roof size, electricity bill, and local sun hours. Calculate system size, payback period, and 25-year savings.

## What this calculates

Thinking about going solar? Enter your electricity costs, available roof space, and local sun hours to get a realistic estimate of system size, annual savings, payback period, and long-term return on investment.

## Inputs

- **Monthly Electricity Bill** ($) — min 0 — Your average monthly electricity bill in dollars
- **Electricity Rate** ($/kWh) — min 0.01, max 1 — Cost per kilowatt-hour (US average is about $0.13)
- **Usable Roof Area** (sq ft) — min 50, max 10000 — Available south-facing roof area for panels
- **Peak Sun Hours per Day** (hours) — min 1, max 10 — Average peak sun hours (US ranges from 3 in the north to 7 in the southwest)
- **Estimated System Cost** ($) — min 1000, max 100000 — Total installed cost before tax credits (average $2.50-3.50 per watt)

## Outputs

- **System Size** — Estimated system capacity based on roof area
- **Annual Production** — Estimated yearly electricity production
- **Annual Savings** — formatted as currency — Estimated yearly savings on electricity bills
- **Payback Period** — Years to recoup the system cost through savings
- **25-Year Savings** — formatted as currency — Total estimated savings over a 25-year panel lifespan
- **Monthly Production** — Average monthly electricity production

## Details

This calculator estimates solar savings using industry-standard assumptions. A typical residential solar panel produces about 10 watts per square foot. Production is calculated as system capacity times peak sun hours times 365 days, with an 80% efficiency factor that accounts for inverter losses, temperature effects, shading, and panel degradation.

Your actual savings depend on whether you can offset your entire electricity bill. If your solar system produces more than you use, the excess may be credited via net metering (policies vary by state and utility). This calculator caps savings at your current annual bill for a conservative estimate.

The payback period divides the system cost by annual savings. Most residential systems pay for themselves in 7-12 years, with the 30% federal solar tax credit (ITC) potentially reducing this significantly. Keep in mind that electricity rates tend to increase over time, which would improve your actual long-term savings beyond this estimate.

## Frequently Asked Questions

**Q: How do I find my peak sun hours?**

A: Peak sun hours vary by location. The US Southwest averages 6-7 hours, the Southeast 5-6, the Midwest 4-5, and the Northeast 3-4. The NREL PVWatts tool provides precise data for your zip code.

**Q: What does the 80% efficiency factor account for?**

A: Real-world solar output is reduced by inverter conversion losses (3-5%), temperature effects (5-10%), wiring losses (1-2%), shading, dirt, and panel degradation over time. The 80% factor is a standard industry approximation.

**Q: Does this include the federal solar tax credit?**

A: No, the system cost input is pre-credit. The federal Investment Tax Credit (ITC) currently covers 30% of installation costs. Reduce your system cost by 30% to see post-credit payback, or enter the net cost after credits.

**Q: How long do solar panels last?**

A: Most solar panels come with a 25-year performance warranty and can continue producing electricity for 30-40 years. Output typically degrades by about 0.5% per year, meaning panels at year 25 still produce around 87% of their original output.

**Q: Is my roof suitable for solar?**

A: Ideal conditions are a south-facing roof (in the Northern Hemisphere) with a 30-degree pitch and no shade from trees or buildings. East- and west-facing roofs work too but produce 10-20% less energy.

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Source: https://vastcalc.com/calculators/everyday/solar-panel-savings
Category: Everyday Life
Last updated: 2026-04-21