Maximum decimal places: 2; Nearest, ties away from zero
Panels
18panels
Size before rounding to panels
6.98kW
Generation per year
11,300kWh
System cost after incentives
$20,160.00
Savings per year
$1,808.06
Simple payback
11.2years
Simple payback ignores panel degradation (about 0.5% a year in the PVWatts manual), price changes and financing, and assumes every kWh offsets a kWh bought at the full price.
Covering 30 kWh a day takes 6.98 kW, which rounds up to 18 panels of 400 W (7.2 kW). They make about 11,300 kWh a year, worth $1,808.06 at $0.16 per kWh, so the $20,160.00 system pays for itself in about 11.2 years.
System size is the daily energy to cover divided by the peak sun hours and by one minus the system losses. Dividing that by the panel rating and rounding up gives the panel count, and yearly generation is the rounded size × sun hours × (1 − losses) × 365. Cost is the size in watts times the installed price per watt, less incentives, and simple payback is that cost divided by the yearly saving.
With the defaults, 30 kWh a day at 5 peak sun hours and 14% losses needs 6.98 kW, which rounds up to 18 panels of 400 W (7.2 kW). They make about 11,300 kWh a year. At 2.80 a watt the system costs 20,160 and saves 1,808 a year at 0.16 per kWh, a payback of 11.2 years.
The 14% default is the PVWatts figure for soiling, shading, wiring and similar losses. PVWatts models the inverter and cell heating separately, so including a 96%-efficient inverter raises the loss to about 17.4%.
How many solar panels do I need?
Divide your daily electricity use by the peak sun hours and by one minus the system losses to get the array size in kW. Divide by the panel rating and round up. At 30 kWh a day, 5 peak sun hours and 14% losses, the array needs 30 ÷ (5 × 0.86) = 6.98 kW, or 18 panels of 400 W (7.2 kW).
This sizes an array to match average yearly use. Roof layout, hour-by-hour shading, batteries and grid-connection rules belong to a site design.
kW, kWh and peak sun hours
A kilowatt (kW) is power and a kilowatt-hour (kWh) is energy: 1 kW running for an hour delivers 1 kWh. Your bill counts kWh; the array is rated in kW.
Peak sun hours are the day's solar energy per square meter written as hours of full sun at 1,000 W/m², so 5 kWh/m² a day is 5 peak sun hours. They are not daylight hours. PVWatts gives yearly averages for any location.
Panels are rated at 1,000 W/m², so 1 kW of panels makes about 1 kWh per peak sun hour before losses. For daily use, divide a year of bills by 365; a single month divided by 30 can mislead in a home with seasonal heating or cooling.
Worked example: 30 kWh a day
Array size. 30 kWh ÷ (5 h × 0.86) = 6.977 kW.
Panels. 6,977 W ÷ 400 W = 17.44, so round up to 18 panels, or 7.2 kW.
Generation. 7.2 kW × 5 h × 0.86 × 365 = 11,300.4 kWh a year, a little more than the 10,950 kWh used because of the rounding.
Cost. 7,200 W × 2.80 per watt = 20,160 before incentives.
Payback. 11,300.4 kWh × 0.16 = 1,808.06 saved a year, so 20,160 ÷ 1,808.06 = 11.15 years.
The 2.80 per watt and 0.16 per kWh are example prices in any currency, not quotes. Use your installer's price and your own tariff in the same currency.
What system losses should I use?
The PVWatts Version 5 manual uses 14% by default for soiling, shading, wiring, mismatch and downtime. It models the inverter, 96% efficient by default, and cell heating separately.
To fold in the inverter, multiply what each step keeps: 0.86 × 0.96 = 0.8256, a 17.44% loss rather than 14 + 4 = 18%. At 17.44% the example needs 7.27 kW, which is 19 panels instead of 18.
Count each loss once. If your sun-hours source already allows for shading or soiling, leave those out of the loss figure.
Solar payback period
Simple payback is the cost after incentives divided by the yearly saving. At a fixed price per watt and tariff, size cancels out: ten panels for 17.2 kWh a day pay back in the same 11.15 years as eighteen.
The figure values every kWh at the full retail price. Export credit below that price stretches it, and so do degradation (about 0.5% a year in the PVWatts manual), maintenance and financing.
The IRS says the 30% Residential Clean Energy Credit is not available for property placed in service after 31 December 2025. A state, utility or local rebate given as a percentage reduces the cost in proportion.
Solar sizing examples
Default is the worked example, and exact panel count is 17.2 kWh a day. Metric price uses 10 kWh a day, 5.5 sun hours, 20% losses, 540 W panels, 50 per watt and a tariff of 8 per kWh.
Half offset rebate covers 50% of the default use at 4.5 sun hours, 3 per watt, a 30% rebate and 0.20 per kWh. No losses is the default with losses set to zero.
Scenario
Panels
Annual generation, kWh
Simple payback, years
Default
18.000000
11300.400000
11.150048
Exact panel count
10.000000
6278.000000
11.150048
Metric price example
5.000000
4336.200000
3.891656
Half offset rebate
10.000000
5650.200000
7.433365
No losses
15.000000
10950.000000
9.589041
Dropping losses to zero cuts the array to 15 panels and the payback to 9.59 years, which shows how much the loss assumption moves both answers.
Mistakes to avoid
Using daylight hours. A day's daylight lasts far longer than its equivalent hours of full sun, so the array comes out too small.
Mixing up kW and kWh. A home using 30 kWh a day needs about 7 kW of panels at 5 sun hours, not 30 kW.
Adding losses. Multiply the fractions kept; adding percentages overstates the loss.
Covering more than 100%. A larger share is possible, but exported energy may earn less than the price you pay, and the roof must hold the extra panels.
Checked against: 15 ÷ (4.5 × 0.86) = 3.88 kW → 10 panels; 4,000 W × 3 × 0.7 = 8,400; 5,650.2 kWh × 0.2 = 1,130.04 a year
Questions
How many solar panels do I need?
Divide your daily use by the peak sun hours and by one minus the losses to get the system size, then divide by the panel rating and round up. 30 kWh a day with 5 sun hours and 14% losses needs 30 ÷ (5 × 0.86) = 6.98 kW, which is 18 panels of 400 W (7.2 kW). Monthly kWh from your bill divided by 30 gives the daily figure.
What are peak sun hours?
The day's solar energy on the panels written as hours of full sun at 1,000 W/m²: 5 kWh/m² a day is 5 peak sun hours. Panel ratings refer to 1,000 W/m² and a 25 °C cell, so a 1 kW array makes about 1 kWh per peak sun hour before losses. PVWatts, now run by the US National Laboratory of the Rockies (formerly NREL), gives yearly averages for any location.
What system losses should I use for solar panels?
PVWatts uses 14% by default: soiling 2%, shading 3%, mismatch 2%, wiring 2%, connections 0.5%, light-induced degradation 1.5%, nameplate rating 1% and availability 3%, combined by multiplying rather than adding. It models the inverter (96% efficient by default) and cell heating separately, so 1 − 0.86 × 0.96 ≈ 17.4% here covers the inverter as well.
How long do solar panels take to pay for themselves?
Divide the installed cost after incentives by the yearly saving. The default 7.2 kW system at 2.80 a watt costs 20,160 and saves 1,808 a year at 0.16 per kWh, so it pays back in 11.2 years. The PVWatts manual puts long-term panel degradation at about 0.5% a year, and power exported for less than the retail price also stretches the payback.
Is there still a federal tax credit for home solar?
Not for new systems. The IRS says the 30% Residential Clean Energy Credit covered property installed from 2022 through 31 December 2025 and is not available for property placed in service after that date. State, utility and local rebates may still apply; enter them as a percentage in the incentives box to update the cost and payback.
For planning only. Lenders, tax authorities and markets apply their own rounding, fees and rules; confirm figures with them before you commit.
Checked against references
This calculator includes 4 worked examples with independently sourced answers. They run in the test suite, and you can run them here too.
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