Solar Panel Financing Calculator
Compare the true 25-year cost of paying cash, financing with a solar loan, or signing a lease. All figures include the 30% federal ITC, electricity rate inflation, and maintenance costs.
System & Location
Solar Loan Parameters
Adjust to match your loan offer. The federal ITC refund is applied as a lump-sum principal payment in Year 1.
Your loan estimate:
ITC refund: $8,400 (applied to principal in Year 1)
Loan after ITC: $19,600
Monthly payment: $201/month
Solar Lease / PPA Parameters
Adjust to match a lease offer. Note: leasing means the solar company claims the ITC — not you.
Important:
With a lease, the solar company claims the 30% ITC ($8,400) — not you. This is included in the comparison below. After the lease term ends, this calculator assumes you return to full grid rates.
25-Year Comparison Results
Grid Only (No Solar)
$57,314
25-year electricity cost at 3%/yr rate inflation
Cash Purchase
Net cost: $19,600 (after 30% ITC)
+$33,414
25-year savings vs. grid
Payback: 11 years
Solar Loan
$201/mo · 6.99% APR · 12yr
+$24,004
25-year savings vs. grid
Payback: 17 years
Lease / PPA
$120/mo starting · 2.9%/yr escalator
+$5,497
25-year savings vs. grid
No ITC benefit · 25-year commitment
Year-by-Year Net Position
Negative numbers mean you've saved more than you've spent (for cash/loan). Grid column shows cumulative electricity bills if you never went solar.
| Year | Grid Bills | Cash Net | Loan Net | Lease Paid |
|---|---|---|---|---|
| Year 1 | $1,572 | $18,128 | $945 | $1,440 |
| Year 2 | $3,191 | $16,609 | $1,844 | $2,922 |
| Year 3 | $4,859 | $15,041 | $2,694 | $4,446 |
| Year 4 | $6,577 | $13,423 | $3,493 | $6,015 |
| Year 5 | $8,346 | $11,754 | $4,242 | $7,630 |
| Year 7 | $12,045 | $8,255 | $5,577 | $11,001 |
| Year 10 | $18,021 | $2,579 | $7,154 | $16,432 |
| Year 15 | $29,237 | −$6,337 | $3,072 | $26,587 |
| Year 20 | $42,240 | −$18,840 | −$9,430 | $38,302 |
| Year 25 | $57,314 | −$33,414 | −$24,004 | $51,817 |
Our Recommendation
Cash purchase wins by $9,410 over 25 years vs. a loan (no interest charges). If you have the funds available, paying cash is optimal. The lease saves $5,497 less than cash — leasing gives away the $8,400 ITC and compounds interest-like costs over time.
Assumptions in This Calculator
- Solar system covers 100% of annual electricity usage (size your system accordingly)
- Cash and loan scenarios include $100/year maintenance and one inverter replacement at Year 15 ($1,800)
- Loan: ITC refund applied as lump-sum principal payment after Year 1 filing
- Lease: payments increase by the escalator rate each year; after lease term you return to full grid rates
- No state-specific incentives (SRECs, SMART, RSIP, etc.) included — add these as a reduction to system cost
- 25-year system life with maintained production (typical 0.5%/year degradation not modeled for simplicity)
- No home value increase from solar is included (typically ~$4,000/kW for owned systems)
Related Guides
Solar System Designer
Size your system and get an Amazon parts list
Solar Payback Calculator
Detailed payback period calculation
Solar Financing Guide
Cash vs. loan vs. lease deep dive
How to Save on Solar
12 proven cost-reduction strategies
How to Compare Quotes
What every proposal must include
Federal Tax Credit Guide
Everything about the 30% ITC