How Long Does It Take For Solar Panels To Pay For Themselves?
Anyone considering investing in solar panels will of course expect that it will be a while before they have paid for themselves producing valuable electricity. How long it will take to reach break even depends on many factors: The initial price of the system including full installation, the longevity of the hardware components of the system itself, the price rate structure of the utility energy provider including the grid operator, taxes on both sell and buy rates, whether you opt to include battery storage, and how much the system changes the value of the building on which the it is installed. Of course you could have a situation where panels are just installed and you pay on a monthly basis without actually owning the system in which case none of the following matters, except maybe the electric vehicle bits.
A Typical Solar Installation
To be honest, the overall question of this article is in reality impossible to answer accurately for any given system, but since I’ve had my solar panels for exactly 10 years know, I can at least provide some data for you to look at. These basic data of how much electricity is generated is useful for making more precise calculations for your local pricing structure, and thus help you forecast how long a given system you are interested in would be able to pay for itself. But first, some specifications on my system:
- 16 panels with a total peak capacity of 4 kWp (I have only come close to this output at noon on very cold and windy summer days).
- 2 inverters capable of 2 kW throughput each (at the time this was cheaper than 1 single 4 kW inverter and would make it easier to install an extra 2 kWp had I needed it).
- Price including all hardware, installation, and tax credit (in 2011 the labour cost was deductible in Denmark): 100,000 DKK ($16,000). A similar system price today 10 years later: 50,000 — 70,000 DKK ($8,000 — 11,000) depending on local tax credits.
- Geographical attributes: Panels facing south at a 30 degree angle, latitude and longitude (Decimal degrees): 56.3332, 10.3826.
Why not 6 kW, which is the largest allowed grid connected system on private property in my area? Well, although it would easily fit on my roof, I simply could not afford it at the time, and up until I got an electric car it would have more capacity than I needed all things considered.
Things to consider that can have a positive impact utilizing excess energy periods when not having opted for a battery as storage:
- Fridge and deep freezer with timer.
- Water heater with timer.
- HVAC system with timer and zone optimisation.
- Electric vehicle with timer and rate configuration of charge.
- Training you own sense of when to use electricity, like vacuuming and washing when the sun is shining.
Of the points above I have really only focused on the last two in my everyday routines, and when the electric vehicle came into play, it became a challenge to micromanage the system to optimize the utilization of the system. It just so happened that the local net metering scheme changed at about the same time I purchased my latest EV, and it actually resulted in choosing the larger battery option in the car than I had originally planned. I have described the detailed considerations in an earlier article, and it seems obvious now 2 years later that the larger EV battery was worth it.
My calculations at the time showed that a battery that was 20 kWh larger would pay for itself within 10 years if I could manage the charging just by prioritizing sunshine. Since then I have changed my electricity supplier to one that sells electricity cheaper when wind turbines produce more power, thus making me prioritize charging in windy situations too.
Electricity consumption
First and foremost let’s look at electricity consumption. On average I use 3,000 kWh of electricity every year in my household. I do not use electricity for heating or cooling my house which is why total consumption might seem low. I am connected to district heating, and in Denmark the average outdoor temperature is so low that use of air conditioning systems (HVAC) for cooling is rare.
In the graph below covering a decade of net electricity consumption I have highlighted 4 years:
- 2010 (blue): No solar panels and no EV. This represents my baseline electricity consumption in a typical full year.
- 2014 (yellow): Solar panels installed, but still no EV. From March through September I get a surplus of electricity production.
- 2016 (green): First full year of driving an EV, Nissan Leaf, 25,000 km/year (16,000 miles/year). Electricity consumption doubles to 6,000 kWh, and only in the summer is it possible to balance out consumption and production.
- 2021 (red): With a Tesla Model 3 long range 75 kWh driving 35,000 km/year (22,000 miles/year) and the yearly net metering out the window, I prioritize free referral code Supercharging in the winter when solar power is low.
When I bought my panels a net metering scheme based on yearly accounting was in effect, but 2 years ago it was replaced with hourly accounting, which left many private solar system owners angry and a class-action lawsuit was initiated but dismissed in court. For nearly 8 years I had conveniently been able to do the math once a year: Subtract kWh consumed from kWh produced and as it turned out the average 3,750 kWh produced each year covered with a comfortable margin the 3,000 kWh consumed.
Getting and EV in the household countered to some degree the disadvantage of net metering on a yearly basis to an hourly basis by making sure to charge as often as possible when the panel generated a surplus of electricity. As mentioned this is the reason I chose a larger range EV than I had planned for. The 20+ kWh of battery capacity in the long range Tesla Model 3 made it easier to charge less often in order to prioritize the sunshine. Not perfect, but still noticeable in terms of freedom of when to charge compared to the low range Nissan Leaf and BMW i3 I had been driving the years prior.
Electricity Production
In order to get a sense of when an investment in a solar power installation will have paid for itself it is of course essential to pay close attention to how much electricity is being generated by the system.
In the graphs below it’s evident that I live relatively far north on the northern hemisphere. Note that this year in red actually deviates quite a lot from the yearly average since May and July usually are the best performing months due to slightly lower average temperatures than June. Solar panels perform best with clear skies and low temperatures preferably with a breeze cooling the panel even more. That’s why you see record outputs in May and July because June is often hotter and more humid. Except this year giving the exact opposite of the norm.
You might think that the sun is up the longest in June and thus should give more power, but since the panels are oriented south and given how far north I live, the sun rises in the north-east and sets in the north-west, sunlight in those very early and late hours do not fall on the panels.
What about degradation? Well, 10 years is of course not a lot to go by, but if the trend in the graph showing total year output persists there might be a couple of percent performance loss per decade. The big risk with panels is more in terms of build quality. If they puncture and moisture gets inside they will fail fast. I chose a high quality brand at the time, even though there where many much cheaper options available. In fact I could have saved 30 — 40% in total costs, but I figured that might cut the lifetime by maybe 50% thinking 4 decades out, and indeed I have spotted many solar panels of the same age and lower price beginning to deteriorate. Since production of silicon based solar panels is an energy intensive process, the longer they sit on the roof producing energy the better.
Note: In Denmark I pay roughly 2.2 DKK/kWh (35 cents/kWh) for grid electricity including taxes. When I sell surplus electricity to the grid I get paid a maximum of 0.3 DKK/kWh (5 cents/kWh) because taxes are not a part of it. No, this is not a typo, there is a lot of tax on energy in this country. This incentifies me to use my generated electricity rather than sell it, which is a challenge with hourly net metering. This is where a home battery and/or EV helps a lot.
Break Even
So, when will the system have paid for itself? Well, in my situation, accounting for the many variable parameters, it looks as if it will be another 2 years before I can say the panels finally produces energy for free. That’s 12 years total, which is not bad considering the panels themselves has a 20 year warranty on construction defects. I expect no less than 30 years of operation.
Checking prices today, I find that an equivalent quality system would cost 60% of what I paid 10 years ago including installation, so investing in solar just makes even more sense now, and more so going forward. Solar panel prices has fallen almost 10× in the last 15 years!
However, it gets more complicated when an EV is included in the mix. You could argue that the EV is part of the system, and that you would now have to look at the combined cost of the solar system and electric vehicle as one single utility since they are practically dependent of each other. I save money on energy to move the car around, and I am able to soak up the surplus energy from the panels much more efficiently.
I could choose to ask the question of when the whole package has paid for it self compared to buying all the electricity from the grid or compare the payback time of the electric vehicle to an equivalent fossil fueled vehicle. In any case solar and EV is without a doubt a win-win.
The share of global solar energy will certainly accelerate with battery storage pricing plummeting. Will I invest in a home battery? I will consider it when energy arbitrage and virtual power plants becomes the norm. In such a scenario it might even be feasible to move the old panels over on top of my garage and replace my whole 50 year old roof with solar tiles. Who knows?
The Takeaway
So, as I said, it’s no easy task to answer the main question of this article, and it is clear that the financial parameters change all the time, so maybe one should not spend too much time trying to calculate this to perfection, but rather just get on with investing in a solar system and rejoice over the savings from day one. It probably will pay off in the end no matter what.
And remember, it is clear that if you plan to include an EV into the mix sooner or later, a matching installed solar capacity could greatly lower the payback time for the combined financial expenditure, more so the more your driving needs.
Below is a few photos of the installation of my panels 10 years ago:
16 panels each with a peak output of 250 Watts
Panels are configured in 2 strands connected to 2 separate 2 kW inverters
The finished system busy doing its photon to electron magic
Can an EV really help power your home when the power goes out? It’s one of the biggest FAQs people have about electric cars — but the answer can be a bit confusing. It’s either a yes, with a but – or a no, with an unless. To find out which EVs can offer vehicle-to-home (V2H) tech to keep the lights on or even lower your energy bills, keep on reading.
Modern EVs have big, efficient batteries capable of storing enough energy to power home for days. That can mean backup power during a storm or the ability to use stored energy during expensive peak hours and recharge again when kilowatts are cheap.
That’s all true – but only in theory. Because, while your EV might have a big battery, that doesn’t mean it has the special hardware and software that allow electricity to safely flow back out of the car baked in. Car companies call this vehicle-to-home (V2H) or bi-directional charging, and only a handful of models currently support it. That’s that, “yes, with a but” asterisk.
Yes, an EV can power your home, but it has to be one of these.
Ford F-150 Lightning
Ford made early headlines using its F-150 Lightning as a life-saving generator during winter ice storms and hurricanes, so it should come as no surprise that it’s included in this list. The best-selling electric truck in America can send up to 9.6 kW of power from its onboard batteries back to the house. More than enough to keep the lights on and the refrigerator running during an outage.
To make it work, you’ll need to install the Charge Station Pro (formerly called Intelligent Backup Power) home charger, the Home Integration System (HIS), which includes an inverter, a transfer switch, and a small battery to switch the system on, as well Ford’s Charge Station Pro 80A bi-directional charger (which comes free with the Extended Range F-150 Lightning, but costs about $1,300 otherwise).
All-in, you’re looking at about $5,000 in hardware, plus installation, to make it work.
Kia EV9
With up to 300 miles of range and ultra-fast charging, the seven-passenger electric SUV from Kia has been a hot seller. And back in March, the Kia EV9 unlocked yet another new feature: vehicle-to-home charging.
When paired with the Quasar 2 bidirectional charger from Wallbox (and the associated Power Recovery Unit, or PRU), a fully-charged Kia EV9 can power a standard suburban home for three days. Longer, still, if you’re keeping the energy use low. The Wallbox Quasar 2 isn’t cheap, though – pricing starts at $6,440 (again, plus installation). For that price, you the PRU plus a wall-mounted 12 kW L2 charger with 12.8 kW of with discharge power on a split-phase system.
Pretty much all the GM EVs
With the exception of the Chevy Brightdrop, GMC Hummer EV, and the hand-built, ultra-luxe Cadillac CELESTIQ, every Ultium-based GM EV can send battery power back to your home through GM Energy’s Ultium Home System – arguably the most fully integrated EV + battery backup + solar option out there outside of Tesla.
GM Energy says its new 19.2 kW Powershift Charger delivers around 6-7% more juice than a typical 11.5 kW L2 charger, delivering up to 51 miles of range per charge hour. Bi-directional charging requires the Powershift Charger to be paired up with a compatible GM EV and the GM Energy V2H Enablement Kit. The full system retails for $12,699, plus installation, and can be financed through GM Financial.
NOTE: some 2024 models might require a software update to enable V2H functionality, which can be done either at the dealer or through an OTA update.
Tesla Cybertruck
Tesla Cybertruck owners may have zero taste, but they have two options when it comes to powering their homes with their trucks. If they already have a Tesla Powerwall, they don’t need anything else. If they don’t, they’ll need to install a Universal Wall Connector charger, a Powershare Gateway, and a Tesla Backup Switch.
That second option will run about $3,500, plus installation.
That rounds off the list of vehicles that ship with V2H software baked in, so if you’re wondering whether or not your EV can be used to power your home, now you know the answer is yes, as long as it’s one of the ones listed above.
But you might remember that I answered the initial question by saying it was either a yes, with a but – or a no, with an unless. So if you want to use your car’s battery as a backup, but don’t have one of the EVs liksted above, that doesn’t mean you’re completely out of luck.
No, with an unless
As some of the earliest and most enthusiastic EV adopters, Tesla fans have also been among the loudest advocates for using the energy stored their cars’ batteries to back up their homes — or even the grid itself. Unfortunately for them, the slow-selling Cybertruck is the only Tesla vehicle that officially supports bi-directional charging. If you’re one of the many Model 3 and Y owners frustrated by those delays, there’s good news: those vehicles are now capable of V2H charging thanks to an “impressive” Powerwall competitor, Sigenergy.
The good news doesn’t stop there, however. The Sigenergy V2X also works with both the popular Kia EV6 and Electrek‘s 2024 EV of the Year, the Volvo EX30 over the DIN70121 protocol, and several VW/Audi/Porsche and Mercedes-Benz EVs over the ISO15118-2 protocol.
Our own Editor-in-Chief, Fred Lambert, recently went on a Sigenergy deep dive with Sylvain Juteau, President of Roulez Electrique, and came away deeply impressed with the system. I’ve included the video, above, and you can read more about the system itself at this link.
And, of course, I look forward to learning about any V2H models or more universal battery backup systems from you, the smartest readers in the blogosphere, in the comments.
Original content from Electrek.
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Tesla has changed the meaning of “Full Self-Driving”, also known as “FSD”, to give up on its original promise of delivering unsupervised autonomy.
Since 2016, Tesla has claimed that all its vehicles in production would be capable of achieving unsupervised self-driving capability.
CEO Elon Musk has claimed that it would happen by the end of every year since 2018.
Tesla has even sold a software package, known as “Full Self-Driving Capability” (FSD), for up to $15,000 to customers, promising that the advanced driver-assist system would become fully autonomous through over-the-air software updates.
Almost a decade later, the promise has yet to be fulfilled, and Tesla has already confirmed that all vehicles produced between 2016 and 2023 don’t have the proper hardware to deliver unsupervised self-driving as promised.
Musk has been discussing the upgrade of the computers in these vehicles to appease owners, but there’s no concrete plan to implement it.
While there’s no doubt that Tesla has promised unsupervised self-driving capabilities to FSD buyers between 2016 and 2023, the automaker has since updated its language and now only sells “Full Self-Driving (Supervised)” to customers:
The fine print mentions that it doesn’t make the vehicle “autonomous” and doesn’t promise it as a feature.
In other words, people buying FSD today are not really buying the capability of unsupervised self-driving as prior buyers did.
Furthermore, Tesla’s board has just submitted a new, unprecedented CEO compensation package for shareholders’ approval, which could give Musk up to $1 trillion in stock options pending the achievement of certain milestones.
One of these milestones is Tesla having “10 Million Active FSD Subscriptions.”
At first glance, this would be hopeful for FSD buyers since part of Musk’s compensation would be dependent on delivering on the FSD promises.
However, Tesla has changed the definition of FSD in the compensation package with an extremely vague one”
“FSD” means an advanced driving system, regardless of the marketing name used, that is capable of performing transportation tasks that provide autonomous or similar functionality under specified driving conditions.
Tesla now considers FSD only an “advanced driving system” that should be “capable of performing transportation tasks that prove autonomous or similar functionality”.
The current version of FSD, which requires constant supervising by the driver, could easily fit that description.
Therefore, FSD now doesn’t come with the inital promise of Tesla owners being able to go to sleep in their vehicles and wake up at their destination – a promise that Musk has used to sell Tesla vehicles for years.
Electrek’s Take
The way Tesla discusses autonomy with customers and investors versus how it presents it in its court filings and legally binding documents is strikingly different.
It should be worrying to anyone with an interest in this.
With this very vague description in the new CEO compensation package, Tesla could literally lower the price of FSD and even remove base Autopilot to push customers toward FSD and give Musk hundreds of billions of dollars in shares in the process.
There’s precedent for Tesla decreasing pricing on FSD. Initially, Musk said that Tesla would gradually increase the price of the FSD package as the features improved and approached unsupervised autonomy.
That was true for a while, but then Tesla started slashing FSD prices, which are now down $7,000 from their high in 2023:
The trend is quite apparent and coincidentally began when Tesla’s sales started to decline.
FSD is now a simple ADAS system without any promise of unsupervised self-driving. This might quite honestly be one of the biggest cases of false advertising or bait-and-switch ever.
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The new Chevy Bolt EV is set to enter production later this year, with one fewer shift, following GM’s reduction in production plans at several US plants. Apart from the Bolt, GM promised a new family of affordable EVs. Are those, too, now at risk?
GM says more affordable EVs are coming, but when?
GM remained the number two EV maker in the US after back-to-back record sales months in July and August. However, with the $7,500 federal tax credit set to expire at the end of the month, the company expects a slowdown.
On Thursday, GM sent a note to employees at its Spring Hill plant in Tennessee, outlining plans to reduce output of two Cadillac electric SUVs, the Lyriq and Vistiq.
A source close to the matter confirmed the news to Reuters, saying the production halt will begin in December. GM will significantly reduce output during the first five months of 2026, according to the source.
GM is also delaying the second shift at its Fairfax Assembly Plant in Kansas City, where the new Chevy Bolt is slated to enter production later this year. The Bolt will be the first of a new series of affordable EVs that GM intends to build in Kansas.
However, those too, may now be in jeopardy. According to local news outlets, GM Korea Technical Research Center (GMTCK), a spin-off of GM’s Korean subsidiary, was recently cut out of a secret small EV project it was developing.
GMTCK president Brian McMurray reportedly announced internally last month during a trip to the US that the project was cancelled and only 30% to 40% complete.
A GM Korea spokesperson clarified that “the EV project being led by GMTCK was a global undertaking, not undertaken solely by GM Korea. The spokesperson added, “The project itself has not been canceled; the role of the Korean team has simply changed.”
The new electric car, dubbed “Fun Family,” was scheduled to launch under the Chevy and Buick brands, using a single platform. Production was expected to begin in 2027 with deliveries starting in 2028.
GM Korea exports over 90% of the vehicles it makes to the US, but with the new auto tariffs, the subsidiary is expected to play a drastically smaller role, if any at all. The news is fueling the ongoing rumors that GM could withdraw from Korea altogether.
In addition to the tariffs, South Korea’s recently passed “Yellow Envelope Law” could make it even more difficult for GM with new labor laws.
Will this impact the affordable EVs GM is promising to launch in the US? They are scheduled to be built in Kansas, but with the R&D Center, GM’s second largest globally, following the US, claiming to be excluded from a major global EV project, it can’t be a good sign.
In the meantime, GM already has one of the most affordable electric vehicles in the US, the Chevy Equinox EV. Starting at under $35,000, the company calls it “America’s most affordable” EV with over 315 miles of range.
With the $7,500 federal tax credit still available, GM is promoting Chevy Equinox EV leases for under $250 a month. Nowadays, it’s hard to find any vehicle for under that.
Source: Newsworks Korea
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