Solar Panel Payback Period Calculator

How it is calculated

This is a simple payback calculation with no discounting. First the yearly net benefit: net = annual savings − annual maintenance. Then payback years = system cost ÷ net. Amounts are in dollars to the cent, and years show two decimals. System cost must be above zero and annual maintenance must be filled in, with 0 accepted but a negative value refused. If the net saving is zero or negative (maintenance equal to or above the savings) the system never pays back, so the tool shows no result instead of a number. Savings and costs are held constant every year. No loan interest, panel ageing, electricity price change, subsidies, tax credits or replacement costs are included, so treat the figure as a first screening number.

Common mistakes

• Entering the savings per month instead of per year. Typing 175 (a month) gives a payback of 102.86 years with no maintenance, while the correct entry is 2,100 a year.
• Using the cost before subsidies or tax credits. The result is only as good as the net cost you type in, so enter what you actually pay.
• Forgetting maintenance, such as cleaning or an inverter fund. Entering 0 shortens the payback, here from 9.23 to 8.57 years.
• Assuming the savings are guaranteed every year. The tool keeps them fixed, but real savings change with electricity prices, weather and panel ageing.
• Entering maintenance equal to or above the savings, or leaving the maintenance box empty. The first has no payback and the second is incomplete, so no result is shown in either case; type 0 if there is no upkeep.