Solar ROI Calculator
Calculate solar system ROI, payback period, and annual savings. The business case for solar in one page.
Free · No signup · By the analysts at Blackridge Research · Updated 2026-07-18
Inputs
Results
What this means
Adjust the inputs to calculate.
About the Solar ROI Calculator
Solar ROI analysis is the business case for solar in one page.
It shows annual production, savings, system cost, and payback period.
Formula
Annual Production = System Size × 1,500 kWh/kW | Annual Savings = Production × Electricity Rate
- SS
- — System Size (kW)
- CPW
- — Cost per Watt ($/W)
- ER
- — Electricity Rate ($/kWh)
- AP
- — Annual Production (kWh)
How to use this calculator
- 1
Enter system size
Solar system size in kilowatts (kW).
- 2
Enter cost per watt
The installed cost per watt of solar.
- 3
Enter electricity rate
Your current electricity rate per kWh.
Example calculations
Commercial solar installation
A 50 kW solar system at $3/W, electricity rate of $0.12/kWh.
Annual Production = 50 × 1,500 = 75,000 kWh. Savings = 75,000 × $0.12 = $9,000. Cost = 50,000 × $3 = $150,000. Payback = 16.7 years.
- Annual production:
- 75,000 kWh
- Total system cost:
- $150,000
- Annual savings:
- $9,000
- Payback period:
- 16.7 years
The solar system pays back in 16.7 years with $9,000 annual savings.
Interpreting your results
Solar ROI depends on system size, cost, and electricity rates.
Payback periods of 10-15 years are typical for commercial solar.
Higher electricity rates and lower costs improve ROI.
Need the market data behind this calculator?
The Solar ROI Calculator is only as good as its inputs. Blackridge Research publishes syndicated market reports with vetted market sizes, growth rates, and competitive landscapes across 40+ industries — and builds custom studies when the shelf report doesn't exist.
Industry applications
Business
- Investment decisions: evaluate solar investment viability.
- Energy cost management: reduce electricity costs.
- Sustainability reporting: calculate carbon reduction.
Construction
- Commercial buildings: evaluate solar for new construction.
- Industrial facilities: assess solar for energy-intensive operations.
Research
- Energy analysis: evaluate solar economics.
- Feasibility studies: solar viability assessment.
Common mistakes to avoid
-
✗ Using average radiation for all locations
Solar radiation varies by location. Adjust the production factor.
-
✗ Ignoring maintenance and degradation
Solar panels degrade ~0.5% per year. Include these in long-term analysis.
Frequently asked questions
›What is a good solar payback period?
10-15 years is typical. Under 10 years is excellent.
›What is the average cost of solar?
$2.50-$4.00 per watt for commercial installations.
Glossary
- Solar radiation:
- The amount of sunlight reaching a location, measured in kWh/m².
- Net metering:
- Crediting solar owners for electricity they feed back to the grid.
- Degradation:
- The gradual reduction in solar panel efficiency over time.
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