How long do solar panels pay back?

Solar panel payback time can range between 5 and 15 years in the United States, depending on where you live. How quickly your solar panels pay back their cost depends on how much you paid, the price of electricity from your utility, and available upfront and ongoing incentives. How is the payback period defined for solar panels?

What is a solar panel payback period?

"Solar panel payback period" is the amount of time it’ll take you to completely pay off your solar power system through savings on your electric bill. It is calculated by taking the total cost to install the system, then subtracting solar incentives and/or rebates, and monthly electric bill savings until the total cost has been paid off.

Should I pay back my solar panels if I don't pay back?

Any money you receive to help pay for your solar panels that you don't have to pay back to anyone can help make your solar power payback period even shorter. The most important of these is the federal Residential Clean Energy Credit, which will reduce the amount of taxes you owe by 30% of the cost of your system.

How long do solar panels last on a roof?

Solar panels on your roof should last for 25 years, and by looking at the total return on investment, they can be compared to other ways to invest your money. If you’d rather skip the long explanations and math equations, you can calculate the payback period for your specific home now by using our solar panel payback calculator:

How long does it take to break even on a solar panel?

For most homeowners in the U.S., it takes roughly 11 years to break even on a solar panel investment. For example, if your solar installation cost is $16,000 and the system helps you conserve $2,000 annually on energy bills, then your payback period will be around eight years (16,000/2,000 = 8).

How do I pay for solar panels?

There are a lot of different ways to pay for solar panels, and they all affect the solar payback period. Cash: If you simply save up for the purchase (using a high-yield savings account, for example), you'll avoid paying any loan interest, and reduce the overall cost of solar panels.