Solar Payback Calculator — Formula
## How to Calculate Solar Payback Period
The solar payback period tells you how many years until your solar investment pays for itself.
### Formula
**Net Cost = System Cost * (1 - Tax Credit %)**
**Payback Period = Net Cost / Annual Savings**
The US federal Investment Tax Credit (ITC) is currently 30% through 2032, significantly reducing the effective cost.
The solar payback period tells you how many years until your solar investment pays for itself.
### Formula
**Net Cost = System Cost * (1 - Tax Credit %)**
**Payback Period = Net Cost / Annual Savings**
The US federal Investment Tax Credit (ITC) is currently 30% through 2032, significantly reducing the effective cost.
Esempio Risolto
A $20,000 solar system with 30% tax credit saving $1,800/year on electricity.
- Tax credit: $20,000 * 30% = $6,000
- Net cost: $20,000 - $6,000 = $14,000
- Simple payback: $14,000 / $1,800 = 7.8 years
- 25-year savings: $1,800 * 25 - $14,000 = $31,000