Solar Panel ROI Calculator
The true return of solar panels compared with investing the same cash, including energy price growth, panel degradation and opportunity cost.
All figures are in today's money: every rate on this page is real, i.e. above inflation. Why?
Installation & Cost
Energy & Production
% of generated power used directly; the rest is sold to the grid.
Economics & Market
Real growth in grid prices, over and above general inflation. Energy savings compound at the global Market Return (5%/yr) set in the header, which is also a real return.
| Metric | Solar | Invest cash | Advantage |
|---|---|---|---|
| Lifetime Value after 20 yrs | €35,200 | €34,493 | €707 |
| Net Upfront Cost after subsidies | €13,000 | – | – |
| Year 1 Savings avoided cost + feed-in | €1,047 | – | – |
| Break-Even solar pulls ahead for good | – | – | Year 20 |
What each choice actually pays
Where your net worth after 20 yrs lands under each decision: investing the cash in the upper panel, buying the panels in the lower one. Both panels use exactly the same buckets, x axis and y axis, so a bar compares directly with the bar below it. Read the shapes, not the overlap: both paths ride the same market in any one scenario, so the distance between these two peaks is not the odds of one beating the other. The Advantage column above settles that.
- Upper panel (Investing instead): The share of scenarios in which investing instead finishes in each range.
- Lower panel (Buying the panels): The share of the same scenarios in which buying the panels finishes in each range. Both panels use exactly the same buckets, x axis and y axis, so a bar here compares directly with the bar above it.
- point at the chart: Hovering or tapping anywhere on the chart names the bucket under the pointer and, for each side, the share of scenarios that finish inside it, below it and above it (the three add to 100%). Dragging across the chart with the mouse zooms to what you selected.
- clipped tail: The ‹ and › percentages at the ends of the axis are the scenarios finishing outside the drawn range, each after a ■ in its side's colour. Up to 1.0% of one side's scenarios sit outside it; they are counted in every number on this page, just not drawn here.
Wealth trajectory
Both start with the same net outlay of €13,000. Energy savings are reinvested in the market at 5%/yr.
Solid lines are the median (P50) paths; the fans are the modelled P10–P90 range at σ = 15% (set in the header): blue for the invest-the-cash pot, emerald for solar's reinvested-savings pot. Both ride the same modelled return each year, so they move together. The Advantage column above states the gap between them.
Annual yield: solar vs. market
Each emerald bar stacks solar's full annual gain: the darker base is real spendable cash the panels free up (savings + feed-in), the lighter top is this year's growth of solar's own reinvested pot. The blue line is the invest-the-cash pot's annual growth at 5%/yr, so the comparison is like with like against the full bar.
- Solar cash (savings + feed-in): Real spendable cash the panels free up each year.
- + growth of reinvested pot: This year's growth of solar's own reinvested savings pot.
- Market pot growth: The invest-the-cash option's annual pot growth.
- Net cost: €15,000 system − €2,000 subsidies = €13,000 actual cash out the door.
- Option A, invest: that €13,000 compounds to €34,493 after 20 years.
- Option B, solar: at 35% self-consumption and €0.080/kWh feed-in, each year's cashflow is reinvested in the same market.
- Hidden math: grid prices grow 1%/yr while panels lose only 0.5%/yr efficiency, so your annual savings grow every year instead of shrinking.
- Real figures throughout: every number here is inflation-adjusted. The global Market Return is defined as a real return, so both the invest-the-cash pot and solar's reinvested savings compound in today's purchasing power. That makes it a like-for-like comparison with no separate inflation input. Energy price growth above is likewise the rate above general inflation.
- Yield vs. yield: the annual-yield chart pits each option's full annual gain against the other. Each emerald bar stacks two segments: the base is solar's real spendable cash (savings + feed-in), the lighter top is the growth of solar's own reinvested pot. Their sum is solar's total annual gain, directly comparable to the blue line (the invest-the-cash option's pot growth). Both grow their pot at the same market rate, so the honest comparison is bar-total vs. line, not cash-only vs. line.
- No resale value: the panels and battery count as worth nothing at exit in year 20, because rooftop hardware is rarely sold on its own. A subsidy helps solar by shrinking the outlay Option A would otherwise have invested.
- Break-even is the first year Option B's reinvested savings (the green curve on the chart) overtake Option A's market growth and stay ahead through your exit year. It's the sustained crossing marked by the dashed line.
- How the scenarios work: the median lines pretend the market grows at a smooth 5%/yr, but reality is bumpy. The fans and histograms model both the invest-the-cash pot and solar's reinvested-savings pot as compounding at the SAME lognormal annual return with median 5% and volatility σ = 15% (set in the header). Both sides see identical returns; only the energy savings, feed-in and battery costs stay fixed.
Net cost / upfront outlay
netCost = 15,000 − 2,000, upfrontCost = netCost + (battery ? 8,000 : 0)
- V: solar panel cost
- Sub: subsidies / grants
- B: battery cost, only if added; both scenarios start from the same larger outlay so the comparison stays fair
Annual solar cashflow (savings + feed-in)
production(n) = 6,000 × (1 − deg)^(n−1) price(n) = 0.35 × (1 + inf)^(n−1) cashflow(n) = production(n) × sc × price(n) + production(n) × (1 − sc) × 0.08
- P: annual production, kWh (year 1)
- deg: panel degradation, as a fraction = panelDegradation/100
- p_0: grid price today
- inf: energy price growth, as a fraction = energyInflation/100
- sc: self-consumption share, as a fraction (battery self-consumption if a battery is added, else the plain slider)
- f: feed-in tariff per kWh
Option A: invest the upfront cost
- r: global Market Return, as a fraction = marketReturn/100
Option B: solar (reinvested savings)
solarVal(n) = cashPot(n) = cashPot(n−1) × (1 + r) + cashflow(n) [− B every 15 years, except at n = lifespanYears]
- r: global Market Return, as a fraction = marketReturn/100
- L: battery lifespan in years, repurchased at every multiple of L before the final year
- solarVal: the panels and battery themselves count as worth nothing at exit
Lifetime advantage
netProfit = solarVal(20) − investedVal(20)
- N: system lifespan, years
Assumptions behind every figure: how this site models the market →
Every model leaves things out. Here is what this one does not see:
- Inverter replacement (typically needed once across a 20-year system life), panel cleaning, and any roof work or insurance triggered by the install are not modelled, so solar looks cheaper than it is.
- Feed-in tariffs and self-consumption rules are held fixed for the entire horizon, but many jurisdictions have retroactively cut export rates or capped them for existing installs. Solar's income stream carries a policy risk this model doesn't see.
- The feed-in tariff is held constant in today's money. Most tariffs are fixed in nominal currency for their whole term, so inflation shrinks their real value every year; over a 20-year life the feed-in revenue is overstated, more so the higher inflation runs.
- Grid electricity prices are modelled as one smooth inflation rate; real energy markets are volatile (the 2021-22 European gas shock, for one) and get no P10-P90 fan the way the invest-the-cash alternative does, so solar's savings look steadier than they'd actually be.
- Whether solar adds to, or subtracts from, resale value if you sell the house before the system pays for itself is not modelled at all.