How Many Years To Break Even On Solar Panels

Data from the energysage solar marketplace shows that in 2020 solar shoppers who compare their options in the marketplace can achieve payback on their solar investment in about 8 years.

How many years to break even on solar panels. If your cost of installing solar is 20 000 and your system is going to save you 2 500 a year on foregone energy bills your solar panel payback or break even point will be 8 years 20 000 2 500 8. Solar panels are typically under warranty for 25 years so that s the standard figure used for the lifetime of a system although it s often much longer. Is just above 8 years. To provide a general range hancock says most individuals who go solar will break even in 15 to 25 years leasing versus buying a solar system outright.

In this example let s say the price for solar panels is higher in his area 4 w or. Given that many solar panels and inverters come with 25 year product warranties you can expect more than two decades of trouble free operation from your solar array. After your investment is paid off your solar panels will continue to generate clean electricity for free and will continue to do so for as long as your equipment lasts. He wants to meet 100 of his energy costs with solar panels.

Solar panels are designed to last at least 25 years and many modern brands will last much longer than that. To provide a general range hancock says most individuals who go solar will break even in 15 to 25 years leasing versus buying a solar system outright we guide homeowners with what we ve. Credits for approved solar installations installing alternative energy equipment in your home can qualify you for a credit equal to 30 of your total cost. However if you live in a state with low electricity prices and few incentives you ll most likely break even faster with an outright purchase.

To figure out payback period without the solar panel cost calculator we first calculate the true cost of installing solar after incentives have been claimed then we compare that against the cost of electricity from the utility company which tells us how long it takes to break even on the system. Those solar shoppers will continue to enjoy free electricity for the life of their solar panel systems which can last between 25 and 35 years. When considering that lifetime any payback period less than about half that time or 12 5 years can be considered decent more important than payback time is a concept called internal rate of return or irr for short. In addition to the federal tax credit of 30 his utility offers an incentive of 0 3 w for solar projects.

The typical solar payback period in the u s. The credit is available through the end of 2019. After that the percentage steps down each year and then stops at the end of 2021. The price of electricity is 0 13 kwh.