Our Methodology

Primary Data Sources

NREL PVWatts Solar Production & System Sizing

Solar energy production estimates follow the methodology established by the National Renewable Energy Laboratory's PVWatts Calculator. Our formulas use the same core relationship: Annual Production (kWh) = System Size (kW) × Peak Sun Hours (hrs/day) × 365 × System Efficiency (%). Default system efficiency of 80% reflects typical losses including inverter conversion (3–5%), DC wiring (2–3%), temperature derating (5–10%), and soiling (1–3%), consistent with NREL's standard derating factors.

NREL NSRDB Peak Sun Hours

Default peak sun hour values are derived from NREL's National Solar Radiation Database (NSRDB), which provides hourly solar resource data for the continental US and beyond. The US average is approximately 4.5–5.5 peak sun hours per day, with Hawaii and the Southwest reaching 5.5–7 and the Pacific Northwest and Northeast averaging 3.5–4.5. Users should enter their location-specific value from PVWatts for the most accurate estimates.

EPA eGRID Carbon Emissions Factors

Carbon offset calculations use regional grid emissions factors from the EPA's Emissions & Generation Resource Integrated Database (eGRID). The US average factor used is approximately 0.720 lbs CO₂/kWh (EPA eGRID 2024, est.). Regional factors range from approximately 0.3 lbs/kWh (Pacific Northwest, hydro-heavy) to 1.2 lbs/kWh (coal-heavy Midwest grids).

Lawrence Berkeley Lab Installation Cost Benchmarks

System installation cost defaults are calibrated against Lawrence Berkeley National Laboratory's annual Tracking the Sun report and their U.S. Solar Photovoltaic System and Energy Storage Cost Benchmark. National residential installed cost averages $2.50–$3.50/W (2026). These defaults are reviewed and updated quarterly.

EIA Electricity Rates & Escalation ● Live

Electricity rate inputs are automatically updated with live data from the EIA Open Data API. On each page load, the calculator fetches the latest monthly U.S. average residential electricity price directly from EIA, updates the rate input, and reruns the calculation silently. The value is cached locally for 24 hours to avoid redundant requests. Fields updated with live data show a small green dot (●) next to the label. The US residential average is currently $0.16–$0.18/kWh. Historical electricity price escalation has averaged 2–3%/year over the past 20 years, used as the default escalation rate in financial projections.

Default Calculation Assumptions

Parameter	Default Value	Basis
System efficiency	80%	NREL PVWatts standard derating (inverter, wiring, temperature, soiling)
Panel wattage	400 W	Current residential panel average (2025–2026)
Panel degradation	0.5%/year	Industry standard for tier-1 monocrystalline PERC panels
System lifetime	25 years	Standard industry warranty benchmark; many systems last 30–35 years
Electricity rate	$0.16/kWh	Live from EIA Open Data API — updated on every page load (24-hr cache)
Rate escalation	3%/year	20-year historical EIA residential rate trend
Peak sun hours	5 hrs/day	Near-average US location; users should enter their local value
LFP battery DoD	80%	Conservative manufacturer specification for LFP lithium chemistry
NMC battery DoD	80% (+15% size buffer)	Typical NMC spec with additional safety margin for real-world performance
Installation cost	$2.85/W	Lawrence Berkeley Lab 2026 benchmark (mid-market residential)
CO₂ emissions factor	0.720 lbs/kWh	EPA eGRID 2024 (est.) U.S. average
MACRS depreciation basis	Cost − 50% of ITC	IRS Publication 946, Section 48 ITC basis rules

Federal Solar Tax Credit (ITC) Status

The residential federal Investment Tax Credit (Section 25D) expired December 31, 2025 for homeowner-purchased and financed solar systems under current law. Calculators that include a tax credit input default to 0% to reflect this. The field remains editable so users can model historical scenarios or evaluate the impact if future legislation restores the credit.

The commercial ITC (Section 48) for business and non-profit solar installations may have different provisions. Consult a qualified tax professional for current commercial ITC status.

Net Metering Assumptions

Net metering calculations default to a 1:1 retail rate buyback (full net metering), which remains available in many states. However, several major states have transitioned to reduced-rate export compensation:

• California (NEM 3.0): Export rates approximately 2–5 cents/kWh depending on time of day, significantly lower than retail rates of 25–35 cents/kWh. Self-consumption and battery storage are critical for California customers.
• Arizona, Nevada, Florida: Various "net billing" or avoided-cost export structures at rates below retail.
• Most other states: Full or near-full retail net metering still in effect as of early 2026.

Users in states with reduced export rates should set the buyback rate to their utility's actual compensation rate for accurate estimates.

Update Schedule & Review Process

We review and update default values quarterly, or immediately when significant policy changes occur (such as ITC expiration, major utility rate restructuring, or updated NREL benchmarks). Updates include:

• National average electricity rates (EIA monthly data)
• Installation cost benchmarks (Lawrence Berkeley Lab annual report)
• Federal and state incentive status
• Emissions factors (EPA eGRID annual release)
• State net metering policy changes

All calculation logic, default values, and data source references are reviewed by solar industry professionals with residential installation and financial analysis experience before each quarterly update. This includes cross-checking default assumptions against current installer pricing, verifying incentive program status, and confirming that formula logic reflects real-world installer practice.

Limitations & Important Caveats

• Estimates, not guarantees. All calculator outputs are estimates based on the inputs you provide and the default assumptions above. Actual system performance, costs, and savings will vary.
• Site-specific factors not modeled. Roof shading, azimuth deviation from due south, roof pitch, electrical panel upgrade costs, permitting fees, and HOA restrictions are not fully accounted for in default calculations.
• Tax and financial advice. Nothing on this site constitutes tax, financial, or legal advice. For decisions involving significant capital expenditure or tax credits, consult a licensed professional.
• Installer pricing varies. Installed cost per watt varies by 30–50% across different markets, installers, and equipment tiers. Get multiple quotes before making purchasing decisions.
• Policy risk. Solar incentives, net metering rules, and utility rate structures are subject to regulatory and legislative change. Financial projections covering 20–25 years carry inherent uncertainty.

Questions & Corrections

If you spot an error in a calculation, an outdated default value, or a source that needs updating, please contact us at [email protected]. We take methodology accuracy seriously and review all substantive feedback.