What Is a Solar Savings Calculator?
A solar savings calculator is a financial tool that provides a high-level estimate for a residential solar panel installation. It helps you understand the potential return on investment (ROI) over the typical 25-year lifespan of a solar energy system by calculating your recommended system size, annual savings, and payback period. This free calculator is the first step in determining if going solar is the right financial decision for your home.
Last updated: November 8, 2025
How to Use This Calculator
Our free solar calculator gives you an instant financial estimate. Follow these steps:
- Enter Average Monthly Bill: Input your average electricity bill amount over the last 12 months.
- Enter Your Electric Rate: Find your cost per kWh on your utility bill.
- Input Peak Sunlight Hours: Enter the average daily peak sunlight hours for your location (e.g., 4.5).
- Provide Gross Installation Cost: Enter the total price quote from a solar installer before any incentives.
- Add Incentives: Input the value of any federal, state, or local tax credits or rebates.
- Click "Calculate Savings": See your estimated system size, payback period, and lifetime savings.
Understanding Your Solar Savings Estimate
Our calculator provides several key metrics to help you analyze your potential solar investment.
- Recommended System Size (kW): An estimate of the solar system capacity needed to offset most of your current electricity usage.
- Annual Savings: The estimated amount of money you will save on your electricity bill in the first year.
- Payback Period: The estimated time it will take for your accumulated savings to equal your net investment cost.
- 25-Year Net Savings: The estimated total profit from the system over its lifespan (Total Savings - Net Cost).
According to Zillow research, homes with solar panels can sell for an average of 4.1% more than comparable homes without solar.
Example Solar Savings Calculation
This is a common scenario for a mid-sized home in a location with average sunlight.
| Input | Example Value |
|---|---|
| Average Monthly Bill | $150 |
| Energy Rate | $0.17/kWh |
| Gross Install Cost | $20,000 |
| Incentives (30% ITC) | $6,000 |
| Payback Period | ~9.1 years |
| 25-Year Net Savings | ~$24,400 |