Solar Panel Calculator

The formula

Solar sizing runs on one production figure and works backwards from your usage.

Annual production per kW = peak sun hours × 365 × (1 − losses)

Then:

• System kW = (annual kWh × offset) ÷ production per kW
• Panels = system watts ÷ panel wattage, rounded up
• Roof area ≈ panels × 21 sq ft

Peak sun hours is not hours of daylight. It is the number of hours per day at which the sun would have to deliver a full 1,000 W per square metre to give you the same total energy. The US ranges roughly from 3.7 in the Pacific Northwest to 6.0 in the desert Southwest.

Worked example

A home using 1,000 kWh a month in the Southeast, 410 W panels, 20% losses, aiming to cover all of it.

1. Annual use = 1,000 × 12 = 12,000 kWh 2. Production per kW = 5.0 × 365 × 0.80 = 1,460 kWh per kW per year 3. System size = 12,000 ÷ 1,460 = 8.2 kW 4. Panels = 8,200 ÷ 410 = 21 panels 5. Roof needed = 21 × 21 = 441 sq ft 6. At $3.10 per watt = about $26,700 before any incentive

About the 20% losses

Nameplate wattage is measured at 25 °C in a laboratory. Real arrays lose energy to inverter conversion, DC and AC wiring, module mismatch, dust and pollen, occasional snow, and — the big one — heat. Panels lose roughly 0.3 to 0.4% of output per degree above 25 °C, so a black roof in Phoenix in July is producing well under nameplate.

NREL's PVWatts model defaults to about 14% total losses on a clean, unshaded, well-designed system. Twenty percent is the more honest figure for a typical residential roof with some shading and normal soiling. If a proposal shows losses under 12%, ask what they excluded.

The federal credit changed

This matters more than the panel spec, so be careful with anything you read that predates 2026.

The residential clean energy credit under section 25D — the 30% credit homeowners claimed for a system they bought outright — expired for property placed in service after 31 December 2025. This calculator therefore applies a zero federal credit by default, because for most homeowners buying a system now, that is the correct number.

The commercial credit under section 48E is on a different schedule, and it is why third-party-owned systems — leases and power purchase agreements — can still reflect a credit in their pricing: the credit goes to the company that owns the panels, not to you. Some states and many utilities also run their own rebates and performance payments, and those are entirely unaffected. Check your state energy office and your utility before assuming the incentive picture is bare.

Payback depends on your utility, not your panels

The single biggest variable in whether solar pays is what your utility does with the power you export at midday and do not use.

Under full retail net metering, every exported kWh offsets a kWh you later import, one for one. Payback is short and simple. Under net billing — which is now the rule in California, and increasingly elsewhere — exports are credited at a wholesale-ish rate that may be a fifth of retail. The same array in the same sunshine can take twice as long to pay back, and the economics tilt sharply towards adding a battery so you consume your own production instead of exporting it.

Find out which regime applies to you, and at what rate, before you compare quotes. Then treat any payback figure in a sales proposal — including the one above — as a screening number, not a forecast. Real ones account for rate escalation, 0.5% annual panel degradation, an inverter replacement somewhere around year 12, and the cost of the money if you finance.