Frequently Asked Questions
Everything you need to know about solar payback periods and our estimator.
Q.What is a solar panel payback period?
The solar panel payback period is the amount of time it takes for the savings on your electricity bill to equal the initial cost of purchasing and installing your solar energy system.
Q.What is a good payback period for solar panels?
A typical payback period for residential solar panels is between 6 and 10 years. If your payback period is within this range, it's generally considered a good investment.
Q.How do I calculate my system cost?
Your system cost should include the total price of the solar panels, inverter, mounting hardware, wiring, and installation labor before any tax credits or rebates are applied.
Q.What incentives should I include?
You should include the Federal Solar Investment Tax Credit (ITC), any state-specific tax credits, local utility rebates, and Solar Renewable Energy Certificates (SRECs) if applicable in your area.
Q.How do I find my electricity rate?
Your electricity rate is usually listed on your monthly utility bill as cents per kilowatt-hour (kWh). If you have tiered or time-of-use rates, use your average rate.
Q.How accurate is this estimator?
This estimator provides a solid baseline based on the numbers you input. However, actual payback periods can vary due to changing electricity rates, weather patterns, and panel degradation over time.
Q.Do solar panels increase home value?
Yes, numerous studies have shown that homes with solar panels sell for more than comparable homes without them. This added value can further improve your overall ROI.
Q.What maintenance costs should I expect?
Solar panels require very little maintenance. You might want to budget a small amount annually for occasional cleaning or a future inverter replacement (usually needed after 10-15 years).
Q.Does the payback period account for panel degradation?
This simple estimator uses a flat annual production rate. In reality, solar panels degrade slightly (about 0.5% per year), which may slightly extend the actual payback period.
Q.What happens after the payback period?
Once you reach the end of your payback period, the electricity your system generates is essentially free, resulting in pure savings for the remainder of the system's 25-30 year lifespan.