Solar Panel Savings Calculator
Calculate solar panel payback period, annual savings and 25-year return on investment.
By Konstantin Iakovlev · Founder, Calks.uk
Last updated: · Verified against HMRC and GOV.UK 2026/27 rates
Annual Saving
£671.50
Payback Period
8.9 years
Annual Generation
3,400 kWh
25yr Return
£10,787.50
Bill Savings (self-use)
£416.50/yr
Export Income
£255.00/yr
Disclaimer
This calculator is provided for informational purposes only and should not be considered as financial or tax advice. All calculations are performed locally in your browser — no personal data is collected or sent to our servers. Rates and thresholds are sourced from HMRC and GOV.UK and are updated for the current tax year. Always verify results with HMRC or consult a qualified professional before making financial decisions.
How It Works
Solar panels generate electricity from sunlight, reducing your reliance on grid energy. A typical UK domestic system is 3–4 kW (8–10 panels), costing £5,000–£8,000 installed. Output varies by location, roof orientation and panel efficiency, but a 4 kW system in southern England generates approximately 3,400 kWh per year.
You save money by using the generated electricity directly (avoiding the unit rate) and can earn additional income through the Smart Export Guarantee (SEG) by selling surplus electricity back to the grid. SEG rates vary by supplier but typically range from 3–15p per kWh exported.
Battery storage (£2,000–£5,000) lets you store daytime generation for evening use, increasing the proportion of self-consumption from around 30–50% to 70–80%. This calculator estimates generation, savings, SEG income and payback period based on your location and system size.
How much can solar panels save in 2026? Typical UK domestic system (4 kWp, 10-12 panels): generates 3,400-3,800 kWh/year. Self-consumption rate without battery: 30-40% — saves £350-£450/year. With battery storage (5-10 kWh): self-consumption 70-80% — saves £700-£900/year. Plus Smart Export Guarantee (SEG): 5-20p/kWh for excess exported to grid = additional £150-£500/year. Total savings: £500-£1,400/year depending on usage patterns and tariffs.
Payback period in 2026. Typical 4 kWp installation £6,000-£9,000 (down from £15k pre-2015). At £700/year savings (with battery), payback 10-12 years. Solar panels guaranteed 80%+ output at year 25 — generate 25-30 years. Total lifetime savings £15-£20k after payback. Battery adds £4-£6k upfront, payback 8-10 years standalone. Solar + battery combination is optimal for most UK homes with daytime/evening electricity use mismatch.
MCS certification and SEG payments. To qualify for Smart Export Guarantee payments, your installation MUST be MCS-certified (Microgeneration Certification Scheme). Use only MCS-approved installers (search MCS database). SEG rates vary by supplier: Octopus Outgoing pays variable (often 15-20p/kWh peak); fixed-rate plans pay 4-6p/kWh; Tesla customers tracker tied to wholesale. You can be on different suppliers for import and export — Octopus Outgoing + cheaper supplier for import is common.
Practical considerations. Roof orientation: south-facing optimal (10° tilt to 30° tilt); east/west facing 75-85% of south output; north-facing rarely worthwhile. Shade: even partial shade reduces output significantly. Roof condition: must be sound for 25-year panel lifetime — replace failing roofs before installing. Planning: most installations are 'permitted development' (no planning permission), but listed buildings, conservation areas, and front-facing panels visible from road may need permission. Get 2-3 quotes — installations vary £6-£12k for same system.
Example: 4 kW system in central England
- Annual generation: ~3,200 kWh
- Self-consumption (50%): 1,600 kWh × 24.5p = £392 saved
- Export (50%): 1,600 kWh × 10p (SEG) = £160 income
- Total annual benefit: ~£552
- System cost: £6,500
- Simple payback: ~11.8 years
Frequently Asked Questions
- How much do UK solar panels cost in 2026?
- 3.5kW system (typical UK 3-bed home): £6,000-£8,500 fully installed including inverter and basic battery monitoring. 5kW system: £8,500-£12,000. 6kW+ premium systems: £12,000-£18,000+. Battery storage (Tesla Powerwall, GivEnergy): add £4,000-£10,000. Costs dropped 60-70% since 2015. VAT: 0% on residential solar installs (since April 2022) — saves £1,200-£3,000 vs commercial rate.
- How much will I generate and save?
- 3.5kW system in South England generates 3,000-3,500 kWh/year. North England/Scotland: 2,500-3,000 kWh/year. Self-consumption 30-50% of generation if no battery; 60-90% with battery. Annual savings: £500-£900 on electricity (offsetting 28p/kWh imports) + £80-£200 Smart Export Guarantee (SEG) payments for excess exported. Payback period: 8-14 years. Lifetime panel guarantee: 25 years (most retain 80%+ output).
- Smart Export Guarantee — how it works.
- Replaced old Feed-in Tariff in January 2020. Energy suppliers must pay for solar electricity exported to grid. Rates vary by supplier: Octopus Outgoing Agile 15-20p/kWh average; British Gas 6.4p; EDF 5.6p. Choose supplier carefully — 3× difference in SEG rates. Smart meter required (auto-meters export). Most homes export 30-70% of generated electricity. Sample 3,500 kWh generated, 50% exported = 1,750 kWh × 15p = £262/year SEG income.
- Battery storage — worth adding?
- Battery (5-10 kWh storage): £4,000-£8,000 added cost. Increases self-consumption from 30-50% to 70-90% — saves £200-£400/year extra. Payback: 10-15 years on battery alone (10-year warranty typical). With time-of-use tariff (Octopus Cosy): charge battery off-peak 7p/kWh, use peak 28p — saves additional £100-£300/year. Best for: heavy users; remote workers (high daytime use); EV owners. Less worthwhile for: light electricity users; properties with low daytime occupancy.