Solar Panel Calculator

A solar panel calculator answers three questions in order: how many kilowatt-hours you need, how much one kilowatt of panels produces where you live, and how long the savings take to repay the price. Sun data come from PVWatts, the free model of the National Laboratory of the Rockies (NLR, known as NREL until December 2025), rates and usage from the U.S. Energy Information Administration (EIA), and prices from Berkeley Lab. The ROI Calculator and the Payback Period Calculator compare the result with other investments.

How the calculator sizes a system

System losses (14% by default, as in PVWatts) cover soiling, shading, mismatch, wiring and availability. The conversion factor covers what PVWatts models hour by hour on top of that: 96% inverter efficiency, panel heating and reflection. It runs from 0.844 to 0.928 across the 51 reference cities, generally higher in cool northern cities, and makes the calculator match PVWatts exactly at default settings. Output beyond your yearly use is not counted as savings, because surplus credits vary by utility.

The federal tax credit ended for 2026 installations

Until 2025, homeowners could claim 30% of the cost through the Residential Clean Energy Credit (IRC 25D). Public Law 119-21, signed July 4, 2025, ended it: the IRS states that the credit is not allowed for expenditures made after December 31, 2025, and an expenditure counts as made when installation is completed, so a system paid for in 2025 but finished in 2026 does not qualify. Systems completed in time claim the credit on Form 5695 with the 2025 return. For the default system the missing credit is worth $8,208 (30% of $27,360); without it the payback is 13.5 years instead of 9.9. Leases and power purchase agreements follow separate rules; this calculator models a system you buy.

Worked example 1: the average U.S. home

These are the calculator's defaults. The average U.S. residential customer used 863 kWh a month in 2024, or 10,359 kWh a year, and paid 16.48¢ per kWh (EIA, the latest full year with state detail). Prices have risen since: EIA's preliminary monthly data put the U.S. residential average at 18.19¢ for January through July 2026, so use the per-kWh rate on your own bill for a current answer. At the household-weighted U.S. average of 5.08 peak sun hours:

1. Output per kW: 5.08 × 365 × 0.86 × 0.887 = 1,414 kWh a year.
2. Size: 10,359 ÷ 1,414 = 7.33 kW, or 18.32 panels of 400 W, rounded up to 19 panels (7.6 kW) that produce 10,746 kWh in year 1.
3. Cost: 7,600 W × $3.60 = $27,360, with no rebate.
4. First-year savings: output exceeds use, so 10,359 kWh × 16.48¢ = $1,707.
5. Payback: with rates up 2.8% and output down 0.5% a year, savings pass $27,360 during year 14, after 13.5 years. Over 25 years they total $58,563, a net gain of $31,203.

With a flat electricity rate the payback stretches to 16.2 years and the 25-year gain falls to $14,092, so the escalation assumption deserves as much attention as the price.

Worked example 2: Phoenix versus Boston

Take a home using 10,000 kWh a year and select each city, which loads its PVWatts output and its state's EIA average rate:

• Phoenix: 1,755 kWh per kW, so 5.70 kW is needed: 15 panels (6.0 kW) for $21,600. First-year savings at 14.91¢ are $1,491, payback takes 12.3 years and the 25-year net gain is $30,082.
• Boston: only 1,302 kWh per kW, so 7.68 kW: 20 panels (8.0 kW) for $28,800. At 29.35¢, though, the first-year savings are $2,935, payback takes 8.8 years and the 25-year net gain is $72,184.

The cloudier city wins because savings are output times price. Prices differ by state too: Berkeley Lab's 2025 medians ran from $3.0 per watt in Washington to $4.1 in North Carolina and New Mexico (Arizona $3.1, Massachusetts $3.4).

Solar production per kW by state

PVWatts v8 output for 1 kW of panels facing south at a 20° tilt in each state's largest city, with the EIA 2024 average residential rate and the first-year value of that output at the full rate. For your own address, run PVWatts directly.

Output ranges from 922 kWh per kW in Anchorage to 1,779 in Albuquerque, almost a factor of two, while the value of a kilowatt ranges from $129 a year in Seattle to $695 in Honolulu, more than a factor of five. Electricity prices, not sunshine, explain most of the spread.

How many solar panels do I need?

Panels of 400 W needed to cover 100% of yearly use with 14% losses, in Seattle (the least sunny contiguous reference city), at the U.S. average and in Phoenix, with the panel area of each array:

Each extra 2,000 kWh of yearly use adds about 1.4 kW, three to four panels, at the U.S. average. Planning an electric car or a heat pump? Include its use now: Berkeley Lab's 2025 median for systems of 2 kW or less was $4.5 per watt, so a small add-on later tends to cost more per watt.

What solar payback really depends on

Payback and 25-year net savings for the average U.S. home at average U.S. sun, by installed price (Berkeley Lab's 2025 medians for cash purchases, all homeowner-owned systems and loan-financed systems) and electricity rate:

At the U.S. average rate, the cash median of $3.00 instead of the loan median of $4.50 cuts payback from 16.3 to 11.5 years; at $3.60 per watt, a 25¢ rate instead of 16.48¢ cuts it from 13.5 to 9.4 years. Loan prices exclude interest, which this calculator does not model.

How to use this calculator

1. Pick your state or the U.S. average. That sets peak sun hours and the state's average rate; replace the rate with your own per-kWh charges for a better answer.
2. Enter your yearly use from 12 months of bills, or switch to Monthly bill. The link below the inputs loads your state's EIA average use.
3. For your exact roof, run PVWatts at pvwatts.nlr.gov with your tilt and direction, and enter its annual solar radiation as the peak sun hours.
4. Adjust the panel size, share covered and price from your quotes, and enter any state or utility rebate.
5. Read the results; in the 25-year table the highlighted row is the payback year.

Who this calculator is for

• Homeowners deciding whether to get quotes, or checking an installer's proposal.
• Buyers comparing a cash price with a loan offer.
• People moving or buying a house who want to see how location changes the numbers.
• Students and teachers who want a transparent sizing method.

Key terms

• kW (DC): panel nameplate capacity; 19 × 400 W = 7.6 kW.
• kWh: energy, the unit your bill charges for.
• Peak sun hours: daily solar energy on the panels in kWh per square meter, equal to hours of full 1,000 W/m² sun.
• System losses: PVWatts' allowance for soiling, shading, wiring, mismatch, availability and similar effects.
• Degradation: the yearly decline in panel output.
• Net metering and net billing: exported power credited at the retail rate, or at a lower rate.
• Payback: years until savings repay the net cost, without discounting.

What changes the result, and tips before you sign

• Electricity rate: the biggest lever, as the Phoenix and Boston example shows.
• Installed price: each $0.60 per watt changes the default system's cost by $4,560.
• Rate escalation: 0% instead of 2.8% moves the default payback from 13.5 to 16.2 years.
• Orientation and shade: the state values assume a south-facing 20° roof without shade; east- or west-facing roofs and shade produce less.
• Export credits: net billing lowers the value of the power you send to the grid.

Get at least three quotes and compare dollars per watt, check each installer's kWh estimate against PVWatts, ask what your utility credits for exports, and read the panel, inverter and workmanship warranties.

Limitations

• State values come from one city per state; sun and rates vary within a state.
• Savings use your full rate for all output up to your yearly use, which overstates them under net billing.
• Batteries, loan interest, maintenance, inverter replacement, insurance and property taxes are not modeled.
• Payback is simple payback without discounting, and your use is held constant for 25 years.

Related calculators

The Electricity Cost Calculator turns appliance watts into kWh and dollars, which helps estimate what a new car charger or heat pump adds to your yearly use. To judge solar as an investment, the ROI Calculator gives the return on the net cost, the Payback Period Calculator handles simple and discounted payback, and the NPV Calculator discounts 25 years of savings to today's dollars.

Sources

• NLR PVWatts Calculator and PVWatts API v8 documentation: sun-hours and kWh per kW for the 51 reference cities (API version 8.5, NSRDB typical-year weather: TMY 2020, and the 2023 polar data set for Anchorage; queried October 2026), the 14% default system losses, 96% inverter efficiency and 1.2 DC-to-AC ratio.
• NLR news release, Energy Department renames NREL National Laboratory of the Rockies (December 2025).
• IRS, Residential Clean Energy Credit and IRS FS-2025-05, FAQs on Public Law 119-21: no credit for expenditures made after December 31, 2025; expenditure made when installation is completed.
• Berkeley Lab, U.S. Distributed Solar and Storage: 2026 Data Update (Tracking the Sun), August 2026: 2025 median installed prices of $3.6 per watt ($3.0 cash, $4.5 loan, $4.9 with storage), state medians, $4.5 per watt for systems of 2 kW or less, 7.7 kW median system size, 21.3% median module efficiency, 25% median roof coverage and 37% storage attachment.
• EIA, Electric Sales, Revenue, and Average Price, Table 5A (2024 Average Monthly Bill, Residential): average use and price by state; U.S. 863 kWh a month at 16.48¢ per kWh.
• EIA, Electric Power Annual, Table 2.4: average residential price of 12.52¢ in 2014 and 16.48¢ in 2024, about 2.8% a year.
• EIA, Electric Power Monthly, Table 5.6.B (preliminary, released September 24, 2026): U.S. residential average of 18.19¢ per kWh for January through July 2026; 18.31¢ in July 2026 alone (Table 5.6.A).
• Jordan and Kurtz, Photovoltaic Degradation Rates: An Analytical Review (NREL/JA-5200-51664): median degradation of 0.5% a year.