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Solar Panel Payback Calculator

Payback and 25-year net benefit with production degradation, rate escalation, inverter replacement, and optional financing.

Inputs

System and cost

DC nameplate size.

Installed dollars per watt before credits.

Credit applied to the gross cost. The 30% residential credit (IRC 25D) ended for expenditures after 2025; verify current law and eligibility.

Cost of an inverter replacement inside the horizon, subtracted from lifetime savings. Enter 0 if the inverter is warrantied for the whole period.

Production and rates

Year-one specific yield for the site. Use a production calculator rather than a regional average.

Annual production loss. Warranties commonly cap year-25 output loss at 15-20% of year one.

Retail rate the production avoids, or your export credit if you export instead.

How much you expect the avoided rate to rise each year.

Financing

Annual percentage rate if financed. Enter 0 for cash.

Term used for the payment figure.

Result

Loan payment (if financed)
$136.11
Net cost after credit
$19,600
Simple payback (0 = never at these inputs)
11.8 yrs
Pays back at these inputs (1 = yes)
1
First-year production
9,800 kWh
Gross 25-year savings before replacement
$56,815
25-year net benefit
$35,715
First-year savings
$1,666

What to check

  • First-year production from a site model, not a regional average.
  • The rate the production actually avoids: retail import, export credit, or a blend if you both use and export.
  • Panel degradation from the warranty, and whether the inverter or another component needs replacement inside the horizon.
  • Whether you finance, and at what APR: the loan payment is a cash-flow constraint even when lifetime net is positive.
  • Which credit you qualify for; the residential credit path changed after 2025.

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Screening model at constant real rates. It assumes the avoided rate and degradation behave as entered, ignores repairs, insurance, and roof work, and does not model time-of-use or export caps. A payback of zero means it does not pay back at the entered inputs, not that it has no value: resilience and environmental goals are not monetized here.

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