Solar panel cost & savings calculator
Is solar worth it? This free solar panel calculator takes your monthly electric bill and state and estimates the system size, panel count, cost, 30% federal tax credit, annual savings, and payback period. Instant, no email, no signup — unlike the lead-capture forms most solar sites use.
Short answer
Solar is usually worth it if you own your home and pay above-average electricity rates. A typical home needs a 5–8 kW system costing about $15,000–$24,000 before incentives — roughly $10,500–$16,800 after the 30% federal tax credit — and pays back in about 5–9 years, faster in sunny, high-rate states like Hawaii, California, and the Northeast. Enter your bill and state for your numbers.
Typical cost
~$3 / watt
before incentives
Federal tax credit
30%
through 2032
Avg U.S. payback
~8.7 yrs
4–5 in Hawaii
6 kW system
~$12,600
after the 30% credit
California: ~5.5 peak sun hours/day, ~30¢/kWh. Assumes ~$3/watt installed and the 30% federal tax credit.
System size
3.7 kW
500 kWh/mo
Payback period
4.4 yrs
to break even
Cost after credit
$7,850
$11,214 − $3,364 ITC
Savings / year
$1,801
6,003 kWh/yr
Estimated 20-year net savings
$38,156
after system cost, with modest rate escalation
Rough estimate from state averages — not a quote. Your roof, shading, real usage, utility net-metering, and installer pricing change everything. The 30% federal tax credit is a credit against taxes owed; confirm eligibility with a tax professional.
Solar system size & payback by electric bill — California
| Monthly bill | System | Net cost (after credit) | Annual savings | Payback |
|---|---|---|---|---|
| $100/mo | 2.5 kW | $5,233 | $1,201 | 4.4 yrs |
| $150/mo | 3.7 kW | $7,850 | $1,801 | 4.4 yrs |
| $200/mo | 5 kW | $10,467 | $2,401 | 4.4 yrs |
| $300/mo | 7.5 kW | $15,700 | $3,602 | 4.4 yrs |
California reference (5.5 peak sun hours, 30¢/kWh); net cost applies the 30% federal Residential Clean Energy Credit at $3.00/watt installed. Pick your state in the calculator — sun hours and rates change every figure.
Solar cost & payback by state
How we calculate this
Every number on this page comes from the same formulas the calculator runs — standard solar-industry sizing math with the assumptions stated:
- Your usage. monthly bill ÷ your state's average residential rate = monthly kWh.
- System size. daily kWh target ÷ (your state's average peak sun hours × 0.8 system derate). The derate covers inverter, wiring, and soiling losses.
- Cost and the federal credit. system watts × $3.00/watt installed, minus the 30% Residential Clean Energy Credit (ITC) — the credit has no dollar cap.
- Savings and payback. annual production × your rate = annual savings; net cost ÷ annual savings = simple payback. Twenty-year savings assume 2.5%/yr utility-rate escalation.
Assumptions
- Statewide-average peak sun hours and rates — your roof's orientation, shading, and utility plan move the real numbers.
- Net metering at the full retail rate; states with lower export rates lengthen payback.
- Estimates, not quotes — a site-specific PVWatts run and installer bids are the real price. This is not tax advice; credit eligibility is between you and the IRS.
Sources
Last reviewed: July 13, 2026
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Frequently asked questions
Is solar worth it?
It depends on your electricity rate, how sunny your area is, and the system cost. Solar pays back fastest where power is expensive and sun is plentiful — Hawaii, California, and the Northeast see 5–8 year paybacks, while cheap-power cloudy states take longer. The U.S. average payback is about 8.7 years. Enter your bill and state above for your estimate.
How much do solar panels cost?
A typical home system runs about $3 per watt installed before incentives, so a 6 kW system is around $18,000. The 30% federal tax credit brings that to about $12,600. Your cost scales with the system size you need, which depends on your electricity usage and local sun.
How does the solar tax credit work?
The federal Residential Clean Energy Credit (ITC) returns 30% of your solar system's cost as a credit against your federal taxes, through 2032. On a $20,000 system that's $6,000. It's a tax credit, not a rebate — you claim it when you file. Confirm your eligibility with a tax professional.
What size solar system do I need?
Enough to cover your target share of your electricity use. Divide your monthly kWh by your area's peak sun hours and days, adjusting for system losses. A home using 900 kWh a month needs roughly a 6–8 kW system, more in cloudier states. The calculator sizes it from your bill.