Last reviewed 12 August 2026
Most solar payback figures you will find online come from installers, and almost all of them still assume a 30% federal tax credit that no longer exists. Ours do not. Here is every input, every assumption, and every thing we leave out — so you can check the arithmetic or disagree with it.
Simple payback divides what the system costs by what it saves in its first year. It is the number most sites publish because it is easy, and it is pessimistic: it assumes electricity never gets more expensive.
payback = net cost ÷ first-year saving
Payback with rate rises runs the maths year by year. Production falls slightly as panels age, electricity gets dearer, upkeep is deducted, and the inverter is replaced. The break-even year is the first one where the running total of savings passes the net cost. It usually lands 1–3 years earlier than simple payback, and it is the figure we lead with.
for each year n:
production = annual kWh × (1 − 0.005)^(n−1)
rate = retail rate × (1 + 0.03)^(n−1)
saving = production × 0.65 × rate
+ production × 0.35 × export rate
+ SREC income
− $150 upkeep
− $1,800 if n = 12
break-even = first year where the running total ≥ net cost
Net cost is the installed price minus any state rebate, state tax credit and federal credit — the last of which is zero in 2026.
| Input | What we use | Source | Refreshed |
|---|---|---|---|
| Annual production | 6 kW array, south-facing, 20° tilt | NREL PVWatts v8 | Yearly |
| Electricity rate | State average residential price | EIA API v2, retail sales | Monthly |
| Export credit | Full retail, a fraction of it, or 5¢ | State net metering rules via DSIRE | Quarterly |
| Installed cost | $2.85 per watt before incentives | EnergySage / SEIA market data | Quarterly |
| State incentives | Rebates, state tax credits, SREC prices | DSIRE, checked by hand | Quarterly |
| Federal tax credit | 0% | IRC Section 25D | On any law change |
Run once per state at the largest metro's coordinates, using NSRDB typical-year weather. PVWatts is the model NREL's own public calculator uses, so anyone can reproduce our figure by entering the same coordinates.
A state average, not your utility's rate. In states with several utilities this is the single largest source of error on this site — your own bill beats our average every time.
Full retail in 23 states, 40% of retail in 13, 25% in 13, and a flat 5¢ in California under NEM 3.0.
A national median. Northeastern labour and permitting run $0.30–$0.50 a watt above it; competitive Sun Belt markets run below.
Only programmes open to a typical owner-occupier are counted. Utility-specific and income-qualified programmes are not, because they do not apply state-wide.
The 30% residential credit expired on 31 December 2025 under the One Big Beautiful Bill Act. Every figure on this site assumes zero. If it returns, one setting changes and all 50 states update the same day.
These are judgement calls, not measurements. Each one is a lever you can move on the map.
| Assumption | Value |
|---|---|
| Share used at home | 65% |
| Panel degradation | 0.5% a year |
| Electricity rate rises | 3% a year |
| Upkeep | $150 a year |
| Inverter replacement | $1,800 in year 12 |
| Horizon | 30 years |
The weakest assumption on the site. A household that is out all day and has no battery self-uses closer to 35%. Where export credit is poor — California, Texas, the South — that difference can move payback by several years. Use the sliders on the map to test your own.
Standard warranty-level assumption; most tier-1 panels do slightly better.
Deliberately conservative. Several regions have run well above this recently, which would shorten every payback shown here.
Cleaning, monitoring and insurance uplift.
The reason the savings curve dips mid-chart. Most string inverters are warranted 10–12 years.
A state shown as never breaking even means the system does not repay its cost within 30 years on these settings, not that solar cannot work there.
A payback figure that quietly includes the good things and excludes the bad ones is marketing. These are the omissions, and which direction each one pushes your real result.
A dealer fee on a solar loan can add 25% to the amount financed. Every figure here is a cash purchase. If you are financing, your real payback is longer than what we show.
Owned systems tend to lift sale price, but the premium varies far too much by market to put in a national model. Treat it as possible upside, not as part of the payback.
In a lease the installer owns the system and claims the commercial credit, so 'payback' does not apply — you are comparing a monthly payment against a monthly bill instead.
Storage changes both the cost and the self-use share. It is not in these numbers.
If your roof needs replacing within five years, add that cost and the removal-and-refit charge before comparing anything here.
SREC income may be taxable depending on your situation. We show it gross.
For a household on its state's average rate, with an unshaded south-facing roof and no financing, we would expect the break-even year to land within about 18 months of what we show. Outside that — a shaded roof, a utility well above or below the state average, a loan with a large dealer fee, or a self-use share far from 65% — the gap widens quickly, and in one direction only: real paybacks are longer more often than they are shorter. Three written quotes will always beat this model for your own house.
Every source is public and free:
If a figure here looks wrong to you, it may well be. Tell us which state and which number and we will recheck it against the source.
| Date | Change |
|---|---|
| 2026-01-05 | Federal ITC set to $0 for all states. Section 25D expired 31 December 2025 and no replacement has been enacted. |
| 2026-01-05 | Installed cost moved to $2.85/W from $2.70/W, following EnergySage H1 2026 pricing and equipment tariffs. |
| 2026-01-05 | California moved to a fixed 5¢ export credit to reflect NEM 3.0. |
We are not an installer and we do not sell solar. Some outbound links to quote services may earn us a commission. That has no effect on the figures: every number on this site is produced by the script described above from public data, and no company can pay to change one, appear on a state page, or be ranked higher.
These are estimates for comparison between states, not financial advice and not a quote for your home. Roof orientation, shading, your usage pattern, your utility's specific tariff and your installer's pricing will all move the result. Get at least three written quotes before you commit.