Estimate your annual electricity savings and 25-year return from going solar — based on your location, usage, and system size.
Solar savings depend on your utility rate, local sun hours, roof orientation, shading, net metering policy, and financing terms. This calculator provides a general estimate. For a precise quote, get proposals from 2–3 licensed installers in your area.
Enter your electricity details and location to estimate your solar savings.
U.S. average: ~$0.13–0.17/kWh. Check your bill or use your state average.
Don't know your size? Use our System Size Calculator.
Enter your details to see estimated solar savings over 25 years.
More peak sun hours = more energy generated per kW of installed panels.
This tool runs a four-step estimate: (1) it turns your monthly bill and per-kWh rate into an estimated annual electricity usage figure, (2) it estimates how much electricity a system of your entered size would generate in your state using average peak sun hours and a real-world derate factor, (3) it compares generation to usage to estimate what share of your bill solar would offset, and (4) it projects 25 years of savings assuming utility rates keep rising and panel output degrades slightly each year.
Annual solar generation (kWh) = System size (kW) × Peak sun hours/day × 365 × 0.80 derate factor
Annual usage (kWh) = (Monthly bill ÷ Rate per kWh) × 12
Usage offset = Annual generation ÷ Annual usage (capped at 100%)
Annual savings ($) = Annual generation × Rate per kWh
25-year savings = each year's savings summed, compounding at a 2.5%/yr utility rate increase and a 0.5%/yr panel degradation factor (0.995 multiplier per year)
A homeowner in North Carolina (5.0 peak sun hours/day) has an average $150/month bill at $0.15/kWh and is considering an 8 kW system.
• Annual usage: ($150 ÷ $0.15) × 12 = 12,000 kWh/year
• Annual generation: 8 kW × 5.0 hrs × 365 × 0.80 = 11,680 kWh/year
• Usage offset: 11,680 ÷ 12,000 ≈ 97%
• Year 1 savings: 11,680 kWh × $0.15 = $1,752
• 25-year total: summing Year 1 savings while compounding a 2.5%/yr rate increase against 0.5%/yr panel degradation lands in the low-$50,000s over 25 years for this example, before financing costs.
This is the same formula the calculator above runs — enter your own numbers for a personalized estimate.
• Your home's specific roof orientation, tilt, and shading
• Time-of-use utility rate structures or demand charges
• Your exact net metering agreement (full retail credit vs. a reduced export rate)
• Financing costs if you use a loan, lease, or power purchase agreement
• Local permitting, HOA rules, or utility interconnection timelines
• Equipment-specific losses (inverter model, wiring, panel mismatch) — this calculator uses an industry-typical 0.80 derate factor rather than a site-specific loss model
Data sources: peak sun hour estimates reflect state-level averages consistent with the NREL PVWatts methodology, the industry-standard approach for estimating solar production from location and system size. Electricity rate context reflects publicly available U.S. Energy Information Administration (EIA) rate ranges. This page was last reviewed for accuracy on August 13, 2026. Found an error? Let us know.
This calculator gives a ballpark figure. Real savings depend on your utility's rate structure, whether net metering is available, how much of your generated electricity you use directly vs. export, system degradation over time (typically ~0.5%/year), and whether you finance with a loan, lease, or cash purchase.
Net metering lets you sell excess electricity your solar panels generate back to the grid, earning credits on your bill. Most states have some form of net metering, but policies vary widely — some states offer full retail credit, others offer reduced rates. Check your utility's current net metering policy before going solar.
Yes — solar panels generate power from daylight, not direct sunlight. States like Massachusetts, New York, and New Jersey have some of the highest solar adoption rates because they combine decent sun hours with high electricity rates and strong incentive programs. High electric rates often matter more than peak sun hours.
It does not model your specific roof orientation or shading, time-of-use utility rate structures, your exact net metering agreement, financing costs (loan interest, lease payments, or PPA escalators), or local permitting and interconnection timelines. It uses state-level average peak sun hours and a standard 0.80 derate factor rather than a site-specific production model.
The state averages used in this calculator reflect typical peak-sun-hour ranges published by U.S. solar-resource references such as NREL's PVWatts methodology, which is the industry-standard approach for estimating solar production from location and system size. Your actual output will vary by exact address, elevation, and local weather patterns.
Want the fuller picture on when solar pays off?
Read: What Is a Solar Payback Period and When Does Your System Pay for Itself → · Size your system first →