The calculation that determines payback time relies on all the ways you can save money on or make money with solar—variables that are as varied as the states themselves. But these variables can be boiled down to a few simple categories:
- Up-front cost of the system
- Incentives that reduce that cost
- Savings from and payments for the electricity produced by the panels
With all those factors lined up, your entire system costs will be paid off in just 4 years—the fastest in the nation. Think about that. With incentives, savings and payments, investment is pays itself back in 3-4 years and keeps making you money for an minimum expected lifetime of 25 years. That is Amazing.
As you can imagine, not all states offer the perfect mix of incentives and high electricity costs that lead to a 3-4 year payback. In fact, by the time you get to the end of the top 10 states, you’re in the 8-10 year payback range. That’s still great, considering a solar panel installed today will likely keep working for a few decades.
No matter what state you live in solar is a great deal. The average payback time is 8-10 years with an IRR of 10.7%, which is better than almost any other investment you can make.