The return from a solar panel installation is not fixed: it depends almost entirely on your specific roof, usage habits, and tariff. A 4kWp system on a south-facing roof with no shading, owned by a household that is home during the day, can generate twice the financial return of the same system on a partially shaded east-facing roof owned by a household that is out all day. Generic payback estimates in brochures and comparison articles cannot capture that difference. This estimator is built to give you a figure that reflects your actual situation.
Enter your roof orientation, shading level, estimated system size, your electricity unit rate, the proportion of generated electricity you expect to use yourself, and the Smart Export Guarantee rate your supplier offers. The estimator shows your estimated annual generation, the split between self-consumed and exported electricity, your total annual financial benefit, and whether a loan at your chosen rate and term is likely to be justified by the saving. All outputs are illustrative estimates based on UK average data. Actual generation will vary. Squared Money is an introducer, not a lender. If you choose to enquire, you will be connected with a regulated broker. This will not affect your credit score.
At a Glance
- Roof orientation is the single biggest variable in solar return. A south-facing roof generates around 25% more than an east or west-facing roof, and around 80% more than a north-facing roof. If your main roof faces east or west, a split array (panels on both sides) may be worth considering.
- Self-consumption rate matters as much as total generation. Electricity you use yourself is worth your full unit rate (around 24p/kWh at typical rates). Electricity you export earns the SEG rate, typically 5p to 15p/kWh. A household that uses more electricity during the day : working from home, running appliances through the day, gets significantly more value from the same system.
- The Smart Export Guarantee rate varies by supplier and changes over time. Check your supplier’s current SEG rate before using this estimator. The rate slider defaults to 8p/kWh but the range is wide.
- No grant is currently available for solar panel installation. Unlike heat pumps, solar panels do not qualify for the Boiler Upgrade Scheme or other current mainstream grant schemes. The full installed cost needs to be funded from savings or a loan.
- The loan payback section shows whether the total interest cost is recovered within the loan term. Most solar installations do not fully break even during the loan term at standard rates. The continuing saving after the loan is repaid is where the long-term financial return comes from.
Solar panel savings estimator
Estimate your annual generation, bill saving, and export income based on your specific roof and household. All figures are illustrative and will vary based on actual conditions.
Your roof
Your tariffs and usage
Loan assessment (optional)
About This Estimator
Generation model
How annual output is calculated
The estimator uses a base figure of 930 kWh per kWp per year for a south-facing roof with no shading, which reflects the UK average based on irradiance data. This is adjusted by an orientation factor and a shading factor to produce the estimated annual generation. A 4kWp south-facing, unshaded system produces approximately 3,720 kWh/year on this model. Actual generation varies by panel efficiency, roof pitch, and local weather.
Self-consumption rate
Why this is the most important variable you control
Electricity you use yourself saves you your full unit rate. Electricity you export earns the SEG rate. At typical rates, self-consumed electricity is worth two to four times as much as exported electricity. Households that are home during the day, run dishwashers and washing machines during daylight hours, or have an EV charger configured to charge from solar will have a significantly higher self-consumption rate and a better financial return from the same system.
Smart Export Guarantee
What the SEG rate means and where to find yours
The Smart Export Guarantee requires licensed electricity suppliers with 150,000 or more customers to offer a tariff for electricity exported to the grid from qualifying solar systems. The rate varies by supplier and changes over time. Some suppliers offer fixed rates; others offer variable rates linked to the wholesale price. Check your supplier’s current SEG offer before using this estimator for a formal financial decision. The estimator defaults to 8p/kWh as a conservative mid-range figure.
Loan assessment section
What the break-even figure means
The loan assessment shows the year in which cumulative annual benefit overtakes total loan interest. For most solar installations financed by loan, this point falls outside the loan term: the loan is repaid before the benefit has fully covered the interest cost. This does not mean the installation is not worthwhile: the saving continues indefinitely after the loan ends, but the financial case rests partly on the long-term return rather than being fully justified within the loan period.
How to Use This Estimator
Set your roof orientation and shading
Select the direction your main roof slope faces. If your roof has slopes facing different directions, use the orientation of the slope where the panels would be installed. For shading, consider trees, chimneys, neighbouring buildings, and any other obstructions that cast shadows on the roof during daylight hours. Light shading means occasional shadow for less than an hour per day. Heavy shading means significant obstruction for several hours.
Set the system size
A typical domestic installation in the UK is between 3.5kWp and 6kWp. Larger systems generate more but cost more and require more roof space. A general guide is that each kWp requires approximately six square metres of roof space. Most domestic roofs can accommodate four to six kWp. MCS-certified installers will assess your roof and recommend an appropriate system size.
Enter your electricity rate and self-consumption estimate
Your unit rate is on your electricity bill or in your energy account online. The self-consumption rate is harder to estimate but the most important variable: use 25% to 35% if you are typically out during the day, 40% to 55% if someone is home most of the day, and 55% to 70% if you run high daytime loads such as an EV charger or have a battery storage system.
Check your SEG rate and review the loan section
Find your Smart Export Guarantee rate in your energy account or on your supplier’s website. Then set the loan section to reflect the system cost from any installer quotes you have received, and test different APRs and terms to see how they affect the break-even position. A shorter term reduces total interest significantly: compare 5 years versus 10 years to see the difference.
What Affects Solar Panel Return Most
The four factors below determine the financial return from a solar installation more than any other. Understanding them before speaking to an installer puts you in a better position to assess whether a quote represents good value and whether the projected savings are realistic for your property.
| Factor | High return scenario | Low return scenario | What to do about it |
|---|---|---|---|
| Roof orientation | South-facing roof, near-vertical pitch of 30 to 40 degrees, no shading. | North-facing roof, very flat or very steep pitch, significant shading. | If the main roof faces north, ask about a split array on east and west slopes, or consider whether the roof is suitable at all. An unfavourable roof reduces return by up to 45%. |
| Self-consumption rate | Household home during the day, EV charged from solar, high daytime electricity usage, battery storage fitted. | All occupants out all day, low daytime electricity usage, no battery, high SEG export rate reduces the cost of exporting. | Shift high-consumption appliances to daylight hours. Consider whether a battery storage add-on is financially justified given your export profile. Even a modest shift in habits can add £100 to £200 to the annual return. |
| System quality and installation | Tier-one panels from a reputable manufacturer, MCS-certified installer, high-quality inverter, panels correctly aligned and secured. | Cheap panels from an unknown manufacturer, uncertified installer, poor inverter, panels not optimally aligned. | Use only MCS-certified installers. MCS certification is required for SEG tariff eligibility and for any future grant scheme. Check the MCS register before accepting any quote. |
| Electricity and SEG tariff | High unit rate (above 28p/kWh), high SEG rate from a competitive supplier, time-of-use tariff that maximises self-consumption value. | Low unit rate, low SEG rate, no time-of-use tariff. | Compare SEG rates across suppliers before installation and consider switching to a solar-optimised time-of-use tariff that pays higher rates for self-consumption during peak periods. The SEG rate makes a material difference to the export income calculation. |
Getting a professional assessment before committing to a loan: for any system above £5,000, a shading analysis and generation estimate from an MCS-certified installer is worth obtaining before finalising the loan amount. Installers use tools such as Solar Edge and Solargis to produce site-specific generation estimates that are more accurate than this estimator. The estimator is designed to give you a realistic ballpark for financial planning and to help you evaluate whether an installer’s projected savings seem plausible. If an installer’s savings estimate is significantly higher than this estimator produces for the same system and roof, ask them to explain the difference.
Related Tools and Guides
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Energy efficiency loan payback calculator
Models when cumulative energy savings overtake total loan interest for any energy efficiency improvement. Use this alongside the solar estimator for a more detailed loan term analysis.
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Models whether saving up for a solar installation over time produces a better financial outcome than borrowing immediately. Particularly relevant where the break-even shows the loan interest is not recovered within the term.
Guide
Home improvement loans for energy efficiency upgrades
Covers all the main energy efficiency improvement types, their cost and saving profiles, grant eligibility, and how to choose between secured and unsecured borrowing for energy works.
Guide
Government grants vs home improvement loans
Covers the current grant schemes including ECO4, GBIS, and the Boiler Upgrade Scheme. Solar panels do not currently qualify for a grant, but if you are considering combining solar with a heat pump, the BUS covers the heat pump element.
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Checking won’t harm your credit scoreFrequently Asked Questions
How accurate is this estimator compared with a professional assessment?
This estimator is designed to give a realistic ballpark figure for financial planning purposes, not to replace a site-specific professional assessment. The orientation and shading factors it uses are based on UK industry data and reflect the general relationship between roof position and generation output. A professional assessment using site-specific tools can account for the exact roof pitch, precise shading objects and their seasonal movement, the specific panels proposed, and local irradiance data for your area. For most homeowners doing initial financial planning, the estimator will be accurate to within fifteen to twenty percent of a professional calculation, which is sufficient to assess whether the project is broadly financially viable before investing in a detailed assessment.
The most common reason for a significant discrepancy between this estimator and a professional calculation is shading. Partial shading, particularly from chimneys and neighbouring buildings that only affect the roof for part of the day, can reduce output by more than the simple shading categories here capture. If you have anything other than very clean, unobstructed sky above your roof during daylight hours, treat the estimator figure as optimistic and have a shading analysis carried out by the installer before committing to a system size and cost.
What is a realistic self-consumption rate for my household?
UK average self-consumption for a solar household without battery storage is typically between 30% and 45%, depending on occupancy patterns and daytime electricity usage. A household where one or more people are home all day, running heating, appliances, and devices, sits toward the upper end of that range. A household where everyone is out from 8am to 6pm, Monday to Friday, sits toward the lower end. The difference between 30% and 50% self-consumption on a 4kWp system generating 3,600 kWh per year is approximately 720 kWh: at a 24p unit rate and 8p SEG rate, that represents about £115 per year in additional annual return.
If you have an electric vehicle or are planning to buy one, configuring the charger to charge from solar during the day can increase self-consumption to 60% to 75% in households with typical driving patterns. This significantly improves the financial return and can shift a marginal financial case into a clearly positive one. Battery storage achieves a similar effect by storing excess daytime generation for evening use, though the battery adds significant cost that needs to be factored into the overall project calculation separately.
Does adding battery storage significantly change the financial case?
Battery storage can increase the effective self-consumption rate significantly, which improves the financial return from the solar system. A typical domestic battery of 5kWh to 10kWh can shift the self-consumption rate from around 35% to 65% to 75%, depending on the household’s generation and consumption profile. At that level, the additional annual saving from the battery can be £300 to £600 per year depending on the system size and tariff.
However, battery storage typically adds £4,000 to £8,000 to the installation cost, and this additional cost needs to be assessed separately against the additional saving it generates. The financial case for battery storage is typically stronger on a time-of-use tariff, where the battery can also be charged from cheap overnight electricity during periods when solar generation is low. For households considering battery storage at the same time as the solar panels, it is worth running the estimator with the higher self-consumption rate that a battery would enable, and then comparing the additional saving against the additional battery cost before deciding whether to include it in the initial installation.
Can I get a loan for solar panels if I am a landlord rather than an owner-occupier?
Yes, though the finance route differs depending on your property situation. For a rental property, an unsecured personal loan can be used for any lawful purpose including solar panel installation, and there is no product rule restricting unsecured finance to owner-occupied properties. However, the financial return calculation is different: where the tenant pays the electricity bill, the bill saving accrues to the tenant rather than the landlord. The landlord’s direct financial return is limited to the SEG export income, plus any rental premium achievable due to the improved EPC rating and lower running costs for the tenant.
For landlords where the EPC compliance argument is the primary motivation, solar panels can contribute to EPC improvements, though they are typically more expensive per EPC point than insulation measures. Landlords considering solar for rental properties should verify the current MEES requirements, the property’s current EPC rating, and which measures most cost-effectively deliver the rating improvement needed. Our guide to home improvement loans for rental properties covers the full picture of financing options and considerations for landlord renovation projects.
Squaring Up
Solar panel return is more variable than most home improvement investments because it depends on factors that differ significantly from one property to the next. Orientation and shading affect generation; self-consumption rate affects whether that generation is worth the unit rate or the SEG rate; and the loan rate and term affect whether the financial return justifies the interest cost within the repayment period. This estimator makes all four of those variables adjustable because none of them has a standard answer that applies to every household.
The loan break-even figure is the most important output for anyone considering financing a solar installation. For most installations financed over seven to ten years, the break-even falls outside the loan term. This is not a reason to reject the investment: the saving continues for the twenty to twenty-five year life of a well-installed system long after the loan is repaid. But it does mean the financial case is partly a long-term one, and the decision should be made with that horizon in mind rather than on the expectation of a net gain within the loan period alone.
Ready to see what you could borrow?
Checking won’t harm your credit score Check eligibilityThis tool is for illustrative purposes only and does not constitute financial advice. All generation estimates are based on UK average irradiance data adjusted for orientation and shading and will differ from actual output, which depends on your specific location, roof pitch, panel specification, installer workmanship, and local weather conditions. Smart Export Guarantee rates are set by individual suppliers and change over time. The SEG rate used in this estimator is illustrative only. Always verify the current rate with your energy supplier. Your home may be at risk if you do not keep up repayments on a secured loan.
