The average EnergySage solar shopper breaks even in about 10.8 years, according to the marketplace’s payback page (updated September 3, 2026). That average hides a huge spread: Washington, D.C. is at 5.16 years, Georgia at 17.19. The federal 30% credit for homeowners is gone for systems placed in service after December 31, 2025 (IRS), so payback now depends mostly on three things you can check yourself: what the system costs, what your electricity costs, and what your utility pays for the power you send back. Here is the formula, the state table, and the tests to run on your own quote.
The Formula
EnergySage gives the calculation as total system cost divided by annual savings. If a system costs $20,960 and saves $2,127 a year, payback is about 9.9 years. That example is our arithmetic using EnergySage’s national 8 kW price and output (11,614 kWh a year) and the EIA’s July 2026 U.S. average residential rate of 18.31 cents per kWh.
This is simple payback. It ignores financing costs, rate changes and panel degradation. NREL’s analytical review of published degradation rates (2012) found a median of 0.5% a year, a mean of 0.8%, and 80% of rates under 1% a year, which trims savings slowly over time. Our payback calculator lets you enter your own numbers.
Payback by State in 2026
The table pairs EnergySage’s payback figure for each state with that state’s average residential rate from the EIA, July 2026.
| State | EnergySage payback (years) | Residential rate (EIA, July 2026) |
|---|---|---|
| Washington, D.C. | 5.16 | 25.21 cents/kWh |
| Massachusetts | 7.32 | 30.49 cents/kWh |
| California | 7.73 | 33.61 cents/kWh |
| New Jersey | 8.84 | 25.19 cents/kWh |
| Maryland | 9.27 | 21.41 cents/kWh |
| Connecticut | 9.56 | 24.16 cents/kWh |
| Pennsylvania | 9.58 | 21.72 cents/kWh |
| Hawaii | 9.72 | 48.00 cents/kWh |
| New Mexico | 10.29 | 16.09 cents/kWh |
| New York | 12.02 | 29.90 cents/kWh |
| Virginia | 12.05 | 17.55 cents/kWh |
| Texas | 12.92 | 15.88 cents/kWh |
| Arizona | 13.23 | 15.38 cents/kWh |
| Florida | 16.30 | 15.03 cents/kWh |
| Georgia | 17.19 | 16.27 cents/kWh |
Sources: EnergySage payback page, September 3, 2026; EIA Electric Power Monthly, July 2026. EnergySage says state averages run from about five years to more than 20.
The pattern is clear: states at 21 cents and up mostly sit between 5 and 10 years, and the states near 15 to 16 cents mostly sit between 13 and 17 (New Mexico, at 10.29, is an exception). But rate is not the whole story. New York (29.90 cents) and Hawaii (48 cents) are slower than their rates suggest, and EnergySage lists several other factors, including incentives, net metering and whether you pay cash. Our solar panel installation cost guide shows how state install prices differ too.
What Losing the Federal Credit Did
In July 2025, before the credit’s end date, EnergySage projected that payback periods would lengthen by 43% without the investment tax credit, with the break-even point delayed by roughly four years on average. Its state examples were:
| State | With credit (years) | Without credit (years) |
|---|---|---|
| California | 5.1 | 7.3 |
| Illinois | 4.1 | 5.8 |
| Tennessee | 14.5 | 20.8 |
| Utah | 19.7 | 28.1 |
Source: EnergySage, July 7, 2025. These were projections made before 2026 pricing was known, so use them for direction, not as current figures. The projected increase was biggest in states where payback was already long, such as Utah (8.4 years longer) and Tennessee (6.2 years longer).
Your Electricity Rate Moves It Most
To see how much, we ran the same 8 kW system through different rates. This is our arithmetic, using EnergySage’s national price ($20,960) and output (11,614 kWh), and changing only the rate:
| Rate used | Annual value | Simple payback |
|---|---|---|
| 12.72 cents (Louisiana) | about $1,477 | about 14.2 years |
| 18.31 cents (U.S. average) | about $2,127 | about 9.9 years |
| 30.49 cents (Massachusetts) | about $3,541 | about 5.9 years |
A real quote uses your local price and sunshine, so the actual figure will differ. Still, the spread shows why the same panels can be a good buy in one state and a slow one in another. If you know your cents per kWh, you can run the same math yourself. Our solar system cost by size guide has the prices for 5, 8, 10 and 12 kW systems.
What Shortens Payback
EnergySage lists three levers: higher monthly electricity costs, available incentives (state tax credits, rebates, SRECs and net metering), and paying cash instead of financing. In practice:
- Use the power you make. In places where exports earn little, solar that offsets your own use pays back faster than solar that is sent to the grid.
- Right-size the system. Extra panels you cannot use lengthen payback. See how many solar panels to power a house.
- Compare three or more quotes. Price per watt varies by installer, and every thousand dollars you save cuts payback proportionally.
- Check state and utility incentives. dsire.org lists them. Verify each one yourself before you count on it.
- Pay cash or a clean loan if you can. Financing costs add to the real total. The lease path has its own math, covered in our solar lease vs buy guide.
What Lengthens Payback
Shade, a roof that faces away from the sun, an old roof that needs replacing soon, an electrical panel upgrade, and a battery added for backup rather than savings all push the break-even date out. Batteries in particular rarely pay for themselves on bill savings alone; see our solar battery cost guide.
Is a 10-Year Payback Good?
Solar is a long-term purchase, so judge it against how long you will own the house and how long the equipment lasts. A 10-year payback leaves many years of savings after break-even if the system keeps running. A 17-year payback leaves far less margin, and any repair, such as an inverter replacement, eats into it. If you plan to sell in 5 years, ask how a buyer values the system; our guide on whether solar panels increase home value covers that.
Bottom Line
The EnergySage average is about 10.8 years in 2026, with D.C. at 5.2 and Georgia at 17.2. The federal homeowner credit ended for systems placed in service after 2025, so electricity price and your utility’s export rules now matter most. Run your own quote through the formula (cost divided by yearly savings), and if the result is much over 12 to 13 years, compare it against other uses of the money before you sign.
FAQ
What is the average solar payback period in 2026?
About 10.8 years for EnergySage marketplace shoppers as of September 2026. State averages range from about 5 years to more than 20.
Which state has the fastest solar payback?
Washington, D.C. at 5.16 years on EnergySage’s page, followed by Massachusetts at 7.32 and California at 7.73 among the states we listed.
How do I calculate my own solar payback?
Divide the total installed cost by your estimated annual savings. For savings, multiply expected yearly kWh by your rate per kWh, then subtract any ongoing charges. Use the production estimate from your quote.
Did the end of the federal tax credit lengthen payback?
Yes. The IRS says the 30% Residential Clean Energy Credit is not available for property placed in service after December 31, 2025. EnergySage projected in July 2025 that payback would be 43% longer without it.
Is solar still worth it in a low-rate state?
Often it is a slow investment. In EnergySage’s data, Florida is at 16.3 years and Georgia at 17.19. Run the numbers on your own quote and compare them to how long you plan to stay.