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Solar Panel Savings Calculator
Calculate how much solar panels could save you based on your current bill, system size, and electricity rate. See your estimated monthly savings, year-one savings, percent of bill offset, and a 25-year lifetime savings projection.
Educational calculators — always consult a licensed professional before making financial decisions.
Check a recent statement — most U.S. households pay $100–$200/month.
Larger systems produce more energy and typically offset more of your bill.
Average home. The most common residential system size.
Check a recent utility bill — most U.S. homes pay $0.12–$0.24/kWh.
U.S. electricity rates have risen roughly 2-4% per year on average historically.
Estimated year-one savings
$1,061 – $1,435
6 kW system
Savings assumptions
Savings estimates assume ~1,300 kWh of production per installed kW per year, 0.5% annual panel degradation, and the utility rate increase you selected. Actual savings depend on your roof's sun exposure, shading, local utility net-metering policy, and real-world weather.
Estimates reflect national averages for educational purposes only. Actual savings vary by location, roof exposure, and utility policy. Always get 2–3 quotes before proceeding.
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What you'll need
- ·Your average monthly electric bill
- ·Estimated system size (4kW–12kW+) you're considering
- ·Your electricity rate in $/kWh (from a recent utility bill)
- ·Expected annual utility rate increase, if you want a custom projection
What you'll get
- ✓Estimated year-one savings — Projected first-year dollar savings range
- ✓Monthly savings — What you'd save on average each month
- ✓Percent of bill offset — How much of your current bill solar could cover
- ✓25-year lifetime savings — Long-term projection with rate increases and panel degradation
Solar savings overview
These examples assume ~1,300 kWh of production per installed kW per year at a $0.16/kWh electricity rate, shown as a ±15% range. Your actual savings depend on your roof's sun exposure, shading, local electricity rate, and utility net-metering policy — use the calculator above with your own numbers for a more accurate estimate.
How it works
Enter your current bill
Tell us your average monthly electric bill and the system size you're considering.
Set your rate assumptions
Adjust your electricity rate and expected annual utility rate increase.
Get your savings estimate
See your year-one savings, percent of bill offset, and 25-year total savings.
Estimated Year-One Savings by System Size
| System Size | Annual Production | Est. Year-One Savings |
|---|---|---|
| 4 kW | ~5,200 kWh | $707 – $957 |
| 6 kW | ~7,800 kWh | $1,061 – $1,435 |
| 8 kW | ~10,400 kWh | $1,414 – $1,914 |
| 10 kW | ~13,000 kWh | $1,768 – $2,392 |
| 12 kW | ~15,600 kWh | $2,121 – $2,870 |
Estimates assume $0.16/kWh electricity and ~1,300 kWh of production per installed kW per year. Actual savings depend on your local utility rate, sun exposure, and net-metering policy.
How solar savings add up
Your savings are the value of the electricity your panels produce instead of buying from the utility. Each year that value is roughly annual production (kWh) × your electricity rate, minus a small amount of panel degradation. Over 25 years those savings compound because utility rates tend to rise while your solar cost is fixed.
- Panel degradation ≈ 0.5%/year. Production drops slowly, so year 25 still yields ~85–90% of year one.
- Utility rate escalation ≈ 2–4%/year. This is why savings grow over time and usually outweigh degradation.
What affects your savings
- Your electricity rate. The higher your $/kWh, the more each solar kWh is worth — high-rate states (CA, MA, NY, HI) save the most.
- System size vs. usage. A system sized to your consumption maximizes offset; oversizing past what you use (or net-metering allows) adds little value.
- Sun hours & orientation. More peak sun hours and a south-facing, unshaded roof mean more production per kW.
- Net-metering policy. Full 1:1 credit is worth far more than avoided-cost or export-rate buyback (see below).
- Rate escalation. Faster utility rate increases push your lifetime savings higher.
Net metering, net billing & buyback
How your utility credits exported power is one of the biggest savings factors. Full net metering credits exports at the full retail rate (best). Net billing (e.g., California's NEM 3.0) credits exports at a lower avoided-cost rate, which rewards using your own power or pairing with a battery. A few utilities offer little or no buyback at all. Confirm your utility's current policy before estimating long-term savings.
Savings, payback & ROI are different
This tool estimates lifetime savings. To see how many years until the system pays for itself, use the Payback Period Calculator; to size a system to your usage, use the Solar Panel Size Calculator. The federal residential tax credit (Section 25D) expired after December 31, 2025, so savings here do not assume it.
Frequently asked questions
How much money can solar panels save me?+
Savings depend on your system size, local electricity rate, and how much power you currently use. A typical 6 kW system producing around 7,800 kWh per year at a $0.16/kWh rate saves roughly $1,050–$1,435 in year one, with savings growing over time as utility rates rise.
Does system size affect my solar savings?+
Yes. A larger system produces more electricity, which directly increases how much of your bill it can offset. Doubling your system size roughly doubles your estimated production and savings, assuming your roof and sun exposure can support it.
What happens to my savings as utility rates rise?+
As utility rates increase, the electricity your solar panels replace becomes more valuable, so your savings grow year over year. This calculator lets you model an expected annual rate increase to project how your savings compound over a 25-year system lifetime.
Do these savings estimates account for panel degradation?+
Yes. Solar panels lose a small amount of output each year, typically around 0.5%, as they age. The 25-year lifetime savings projection factors in this gradual production decline alongside your expected utility rate increase.
Will solar cover 100% of my electric bill?+
It depends on your system size relative to your usage. A system sized to match your annual consumption can offset close to 100% of your bill, while a smaller system will offset a partial percentage. This calculator shows your estimated percent of bill offset based on your inputs.
Want to try different numbers?
Back to the calculator ↑Solar Panel Savings Calculator is built and maintained by the RealCostIQ editorial team. Cost ranges and rates are checked against published industry data and contractor quotes, and revised when the underlying figures move. Read our data methodology or more about who builds this. Every calculation runs in your browser — no account, and none of your inputs are stored.
Cost ranges and rates here are checked against contractor quotes and published industry data. If a number still looks off, email Support@RealCostIQ.com and we'll review and fix it.