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simple calculation for solar pv payback

Too many people call us everyday and ask how the figure out the payback period of an investment in a solar pv system. Today, I wanted to focus on showing you how to simply calculate how long it will take you to break even on a solar electric system you maybe considering for a home or business.

(Total system cost after incentives) + (Maintenance costs x Equipment lifetime)
(Annual system kWh production) x (Your electric rate cost per kWh)

Maintenance costs = $0.02/Annual system kWh production
Equipment lifetime = 25 – 30 years

  • You can forecast annual system kWh production using PVWatts
  • Check your electric bill for your cost per kWh, if you can’t figure out what your average cost for every unit of electricity you consume, then it’s going to be impossible to forecast a payback period for your investment in a solar electric system. Get to know your electric bill!

Author: Deep Patel

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