Our Methodology

The model in one sentence

Payback is the net cost of the system divided by the money it saves each year. Everything else on this page is just how we get those two numbers right for 2026 Australian conditions — where savings are driven by the retail power you avoid buying (self-consumption), not by the few cents you earn exporting surplus to the grid.

This is a deliberate, documented design choice (we call it the self-consumption-dominant model). Older calculators leaned on feed-in tariffs because exports used to be paid generously. In 2026 they are not, so a model that still treats exports as the main return overstates payback. Ours does not.

The exact formula

Given your inputs and your state's defaults, the calculator computes, in order:

• STC rebate = system kW × zone rating × deeming years × STC price
• Net cost (panels) = system kW × install $/kW — the install price you enter is already the after-STC cash price; we add the STC rebate back only to display the gross sticker and the rebate as an explicit line, so the rebate is never double-counted
• Annual generation = system kW × generation per kW per year
• Self-used energy = self-use share × annual generation
• Exported energy = (1 − self-use share) × annual generation
• Annual savings = (self-used kWh × power price) + (exported kWh × feed-in tariff) + battery arbitrage value, if a battery is added
• Payback (years) = net cost ÷ annual savings
• Annual return = annual savings ÷ net cost; 20-year net = (annual savings × 20) − net cost

If annual savings are zero or negative (an extreme combination of inputs), the calculator reports "does not pay back" rather than dividing by zero — it never shows you a broken number.

The battery leg (optional)

When you toggle a battery on, we model installed capex at about $1,000 per usable kWh (2026 market), subtract the federal Cheaper Home Batteries rebate (capped at the first 14 kWh at the full rate), and add the extra value the battery unlocks: it shifts energy you would have exported for a few cents into energy you self-consume at the full retail price, capped at roughly one charge–discharge cycle a day. The saving credited is the retail tariff regained minus the export revenue forgone — never double-counted.

Every constant, its value, and its dated source

These are the numbers that drive the formula. Each was verified on 2026-06-27. We update a value — and only then move the verified date — when the underlying figure genuinely changes.

Federal constants

Per-state defaults

Each state page pre-fills these defaults; you can override any of them. Figures are indicative 2026 residential values on a capital-city basis.

Source notes by data type

• Install $/kW — SolarChoice Price Index, June 2026 + SolarCalculatorHQ state pricing. Net of the STC rebate (the cash price a household pays).
• Power price c/kWh — Canstar average price per kWh by state + Finder/EcoFlow AU; the value of every self-consumed kWh.
• Feed-in c/kWh — Solar feed-in tariffs by state, 2026; IPART (NSW), Essential Services Commission (VIC), DEBS (WA).
• Generation yield — SolarChoice / Clean Energy Council design yield + Bureau of Meteorology peak-sun-hours.

Worked example (South Australia, 6.6 kW)

Using the South Australian defaults above with a 6.6 kW system at 60% daytime self-use:

• STC rebate = 6.6 × 1.382 × 5 × $39.50 ≈ $1,801 (about 46 certificates).
• Net cost = 6.6 × $950 ≈ $6,270 (the after-STC cash price).
• Annual generation = 6.6 × 1,550 ≈ 10,230 kWh/yr.
• Self-used = 60% × 10,230 = 6,138 kWh × 34c = $2,087; exported = 40% × 10,230 = 4,092 kWh × 4c = $164.
• Annual savings ≈ $2,251.
• Payback = $6,270 ÷ $2,251 ≈ 2.8 years — roughly a 36% annual return and about $38,742 net over 20 years.

Freshness discipline — what "verified 2026-06-27" means

The verified date is an honest stamp, not a marketing badge. We re-check the constants on this page on a regular schedule, but we move the date only when an input value actually changes — never just because the site was redeployed. A handful of statutory values (the STC price, the deeming period, each state's install price, power price, feed-in tariff, generation yield, zone rating, and the battery rebate) are the only figures whose change can advance the date. Cosmetic date-bumping would be dishonest and we do not do it.

Several of these constants are on a known decline path: the STC deeming period steps down on 1 January each year to the 2030 SRES sunset, the battery rebate tapers every six months, and feed-in tariffs continue to fall. When those changes land, we update the value, move the verified date, and adjust any affected copy together.

What this model does and does not do

It gives a clear, defensible estimate for a typical household. It is not a quote, and it cannot capture every variable — your exact retailer plan, time-of-use tariffs, shading, roof orientation, panel and inverter quality, or future price changes. Treat the result as a well-grounded starting point and confirm the numbers with a licensed installer and your own retailer before deciding.

Estimate only — not financial, tax or legal advice. See About for who runs The Solar Payback and how it stays independent.