How long will solar panels take to pay off?

Payback for rooftop solar bought in 2026, using your state's electricity price and typical sunshine. The 30% federal credit ended with 2025, and this calculator assumes it is gone.

Prices updated October 2026 from EIA, AAA and BLS data.

Your state

Electricity price

¢/kWh

Monthly electricity use

kWh

System size

Installed cost

$/W

2026 quotes average $2.60 to $3.00.

State and local incentives

Rebates or state tax credits.

Export credit

% of retail

Output, rate increases and upkeep

Yearly output per kW

kWh/kW

Output used as it is made

The rest goes to the grid. Higher if you are home by day.

Yearly electricity price rise

U.S. prices rose 5% in the past year.

Panel output loss per year

Inverter replacement in year 12

Set to 0 if your inverter warranty runs 25 years.

How the math works

Each year, the calculator estimates what the panels produce, values that power at your electricity price, and adds it up until the savings cover what you paid.

Output (year n) = size × output per kW × (1 − loss)^(n−1) Value (year n) = power used at home × price + power exported × price × export credit Price (year n) = today's price × (1 + yearly rise)^(n−1) Payback = first year cumulative value ≥ net system cost

"Power used at home" covers output up to your yearly use. The share you set as "used as it is made" counts at full price, and the rest is credited at your export rate.

What this leaves out

Batteries. A battery adds roughly $8,000 to $15,000 and raises how much of your own power you use.
Loans and leases. This assumes a cash purchase. Loan interest stretches payback; leases change who owns the savings.
Roof work. If your roof needs replacing within 10 years, do that first; removing and reinstalling panels costs extra.
Home value. Owned solar can raise resale value, which is not counted here.

By state

Every state and DC has its own page with this calculator set to its prices, its rank among the 51, and how it compares with its neighbors.

Questions

Is solar still worth it without the federal tax credit?

In high-price states, often yes. With our defaults, payback is about 5.9 years in Hawaii and 7.7 years in California, but about 17.2 years in Washington, where power is cheap and sun is limited. Panels usually last 25 to 30 years, so a payback under about 12 years leaves a good margin.

What happened to the 30% solar tax credit?

The Residential Clean Energy Credit (Section 25D) ended for systems placed in service after December 31, 2025, under the One Big Beautiful Bill Act. Homeowners who buy systems in 2026 cannot claim it. State and local incentives were not affected, so enter any you qualify for.

How long does solar take to pay off on average?

At the U.S. average electricity price of 18.3¢/kWh and $2.80 per watt installed, a 8.0 kW system sized for the average home pays back in about 12.3 years in this calculator.

Why does my export credit matter so much?

Power you send to the grid while you are away is often credited at less than you pay for power. California's net billing rules credit roughly a quarter of the retail price, which is why the calculator starts California at 25%. Your utility's tariff sheet lists the exact rate.

Sources

Electricity price and household use: EIA Electric Power Monthly, Table 5.6.A (July 2026 data) and EIA 2025 retail sales. Installed cost: 2026 residential marketplace averages. Output per kW: typical values for a south-facing fixed roof system by state. Tax credit status: Public Law 119-21.