Step 1: Find your annual kWh usage
Look at the last 12 months of utility bills and add up the total kWh used. Most U.S. homes use 10,000–14,000 kWh per year. If you only have one bill handy, multiply your monthly kWh by 12 (this overcounts in winter, undercounts in summer, but works as an estimate).
Step 2: Calculate the system size you need
System size (kW) = Annual kWh ÷ Local production factor
Production factor depends on where you live:
| Region | Production factor (kWh/kW/yr) |
|---|---|
| Southwest (AZ, NV, NM) | 1,600 |
| California, Texas, Florida | 1,500 |
| Mid-Atlantic, Midwest | 1,300 |
| Northeast, Pacific Northwest | 1,150 |
Example: 12,000 kWh ÷ 1,300 = 9.2 kW system. See our sizing guide for adjustments.
Step 3: Estimate gross cost
Gross cost = System size (watts) × $/W
Use $3.00/W as a national average for cash. For our 9.2 kW example: 9,200 watts × $3.00 = $27,600. See $/W ranges for your region.
Step 4: Subtract state and utility incentives (federal credit no longer applies)
For cash and loan purchases in 2026, there is no federal tax credit. The previously-available 30% Residential Clean Energy Credit expired December 31, 2025. State and utility incentives still apply and vary widely:
- New York: 25% state credit (capped at $5,000)
- Massachusetts: SMART program performance payments
- New Jersey: SREC-II program
- South Carolina: 25% state tax credit (capped at $3,500/year)
- Texas, Florida: utility-specific rebates only, no state credit
See state rebates by state for full list. For our $27,600 example with no state incentives, net cost is $27,600.
Step 5: Estimate annual savings
Annual savings = Annual production × utility rate
For a 9.2 kW system at 1,300 kWh/kW: 11,960 kWh/year. At $0.15/kWh: $1,794/year saved. See payback period to convert savings into payback years.
Step 6: Calculate payback
Payback = Net cost ÷ Annual savings
$27,600 ÷ $1,794 = 15.4 years in our example (national average). Higher utility rates and state incentives shrink this significantly. Hawaii, California, and the Northeast see 7–11 year paybacks; low-rate states see 17–22 years.
Sample 2026 calculations by home size
| Home size | Annual kWh | System size | Gross cost | Net (no fed credit) |
|---|---|---|---|---|
| Small (1,500 sqft) | 8,000 | 6.2 kW | $18,600 | $18,600 |
| Medium (2,200 sqft) | 11,000 | 8.5 kW | $25,500 | $25,500 |
| Large (3,000 sqft) | 15,000 | 11.5 kW | $34,500 | $34,500 |
| XL (4,000+ sqft) | 20,000+ | 15+ kW | $45,000+ | $45,000+ |
(Assumes $3.00/W, 1,300 kWh/kW production factor, no state incentives. Add state credits/rebates separately.)
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Analyze My Bid →Frequently asked questions
Is this calculator accurate for 2026?
Yes. It reflects the post-tax-credit reality: no federal credit on cash/loan purchases. Final pricing depends on your roof complexity and installer pricing, but this gets you within ±15%.
Should I size to 100% of my usage?
Most homeowners size to 90–110% of usage. Going higher rarely pays off because excess production is often credited at wholesale rates. See our offset guide.
Does this include batteries?
No. Battery storage adds $10,000–$15,000 for a typical 10 kWh battery, depending on brand.
Are leases cheaper now that they keep the federal incentive?
Sometimes monthly payments are competitive, but you don't own the system. Lifetime savings are still lower than cash. See our financing guide.