Solar Panel Savings Estimator

1. Enter the system size in kW and the peak sun hours for your site. Keep the PVWatts default losses (14 percent) and inverter efficiency (96 percent) unless you know better.
2. Enter your electricity rate from your bill. Add annual use and an export credit rate if your utility pays less for energy you send to the grid.
3. Enter the installed cost from a quote, any rebates, and a tax credit only if you qualify. Adjust degradation, price change and the analysis period to test scenarios.

Here is what each result means:

A solar panel savings estimate predicts how much a rooftop photovoltaic (PV) system could cut your electricity bills and how long it takes to repay its cost. It combines an energy estimate, in kilowatt-hours, with a money estimate based on your tariff.

It helps a homeowner check an installer proposal, compare system sizes, or see how much a change in electricity prices or incentives matters. It is not a site design. A proper design models your roof angle, direction and shading hour by hour, which this simplified tool does not.

Incentives changed in 2026. The IRS residential clean energy credit page says the 30 percent credit covered property installed from 2022 through December 31, 2025, and that the credit is not available for any property placed in service after that date. The tool therefore defaults the credit to 0 percent.

The estimator converts sun hours into energy, applies PVWatts-style losses, values each year of energy, and counts years until savings cover the net cost.

1. Sun hours. Panels are rated at 1,000 watts per square metre of sunlight. One peak sun hour is 1 kWh per square metre, so a 1 kW array makes about 1 kWh of DC energy per peak sun hour before losses.
2. Losses. The PVWatts Version 5 manual sets default losses of 2 percent soiling, 3 percent shading, 2 percent mismatch, 2 percent wiring, 0.5 percent connections, 1.5 percent light-induced degradation, 1 percent nameplate rating and 3 percent availability. Combined by multiplication, they total 14 percent.
3. Inverter. The inverter turns DC into household AC. PVWatts uses a 96 percent nominal efficiency by default.
4. Money. Each year's energy is valued at your rate, escalated by your price-change input, and reduced by panel degradation.

Consider a 6 kW system on a home using 10,000 kWh a year, with 4.5 peak sun hours, PVWatts default losses, an 18 cent rate and an example installed cost of $18,000 with no credit or rebates.

Year-1 energy: 6 x 4.5 x 365 x 0.86 x 0.96 = 8,136 kWh, which covers 81.4 percent of the home's use. Year-1 savings: 8,136 x $0.18 = $1,464.53.

Payback: with 0.5 percent yearly degradation and flat prices, cumulative savings reach $18,000 after about 12.7 years. Over 25 years the system saves $34,498 in total, or $16,498 net of its cost.

Change one assumption at a time to see what matters. A 2 percent yearly rise in electricity prices shortens payback to about 11.4 years and lifts net savings to $25,973. A system installed in 2025 that qualified for the 30 percent credit would have cost $12,600 net, with payback near 8.8 years, but that credit no longer applies to 2026 installations.

Sunlight, your tariff and the installed price move the result most. Small input changes compound over 25 years.

Sun Hours and Orientation

Sun hours depend on location, tilt and direction. PVWatts reports the average daily solar radiation on the panels for your address; use that figure here rather than a regional guess.

Shading and Losses

Trees, chimneys and nearby buildings raise losses above the 14 percent default. Each extra point of loss removes about 1.2 percent of production at the default settings.

How Your Utility Credits Exports

With full retail net metering, every kWh is worth your rate. With a lower export credit, energy you do not use at home is worth less, so a system sized close to your use pays back faster. Enter both your use and the export rate to model this.

Electricity Prices

EIA data show the US residential average rising from 16.48 cents per kWh in 2024 to 18.19 cents for January to July 2026. Future changes are uncertain, so test both flat and rising prices. The home energy usage calculator helps you find your annual kWh.

This tool does not build in a national price per watt, because installed costs vary by market, roof and equipment. Use your own quotes and compare them on the same basis.

To compare solar with other uses of the same money, the NPV calculator discounts future savings to today's dollars, which a simple payback does not.

Checking an Installer Proposal

Enter the proposed size and price. When the proposal claims far more kWh than this tool at PVWatts defaults, ask which losses and sun hours it used.

Choosing a System Size

Try several sizes with your annual use and export rate. Beyond the point where production exceeds use, extra panels add less value under low export credits. For panel counts, the solar panel calculator sizes an array from your usage.

Testing Incentives and Prices

See how a rebate, a rate increase or a longer analysis period changes payback before you commit.

Understanding Your Bill First

Knowing your rate and usage is the base of every estimate. The appliance energy cost calculator shows where your kWh go.

1. Using Daylight Hours as Sun Hours

A summer day may have 14 hours of daylight but only 5 or 6 peak sun hours. Using daylight hours overstates production several times.

2. Leaving Out Losses

Multiplying kW by sun hours by 365 with no losses overstates output by about 21 percent compared with PVWatts defaults (0.86 x 0.96 = 0.826).

3. Assuming the Federal Credit Still Applies

The IRS says the residential clean energy credit is not available for property placed in service after December 31, 2025. Check for any newer change before you rely on a credit.

4. Valuing All Output at the Retail Rate

When your utility pays a lower export credit, surplus energy is worth less. Enter your use and export rate.

5. Ignoring Financing Costs

Loan interest can add thousands of dollars. Payback here assumes a cash purchase.

6. Forgetting Degradation

Panels lose a little output each year. Leaving degradation at zero slightly overstates long-term savings.

The estimator is a transparent first pass; PVWatts or an installer model gives a site-specific figure.

Not for new home systems, according to the IRS. Its residential clean energy credit page says the credit is not available for property placed in service after December 31, 2025.

About kW x sun hours x 365 x 0.826 with PVWatts default losses. At 4.5 peak sun hours, 1 kW makes roughly 1,356 kWh a year.

Run your address in the PVWatts calculator from the national laboratory. It reports average daily solar radiation in kWh per square metre, which equals peak sun hours.

Use the rate on your own bill, including delivery charges that fall with usage. For reference, EIA reports a US residential average of 18.19 cents per kWh for January to July 2026.

Installers may assume rising electricity prices, a tax credit, higher sun hours or lower losses. Match their assumptions one at a time to find the difference.

Enter your annual use and the export credit rate. Energy above your use is then valued at the lower rate, which lowers savings for oversized systems.

An NREL review of nearly 2,000 measured rates found a median of 0.5 percent a year. The tool uses that as its default.

No. Batteries change how much solar energy you use at home and add cost. Model them with an installer tool.

It is easy to understand but ignores the time value of money and financing. Use net present value for a fuller comparison.

No. The calculation runs entirely in your browser. Nothing is sent to our servers, and anything you choose to Save stays in this browser only.

• Residential Clean Energy Credit (Internal Revenue Service, page last reviewed July 4, 2026).
• PVWatts Version 5 Manual: default system losses and inverter efficiency (Dobos, National Renewable Energy Laboratory, now the National Laboratory of the Rockies, 2014).
• Electric Power Monthly, Table 5.3: average price of electricity by sector (US Energy Information Administration, released September 24, 2026).
• Photovoltaic Degradation Rates: An Analytical Review (Jordan and Kurtz, NREL/JA-5200-51664, 2012).