What a roof pays back.

01Start with what you'd have paid

Solar doesn't earn money so much as stop you spending it. Every unit of electricity your roof makes and your home uses on the spot is a unit you didn't buy. That is the whole return.

So the first input isn't the system at all. It's your bill: how much electricity you use, and what you pay for each unit of it. A home with a large bill has more to save, and the same system on a smaller bill pays back more slowly. Nothing about the panels changed.

Solar doesn't earn money. It stops you spending it.

02Used beats exported

Power from your roof goes one of two places. If something in the house is running, it goes there first, and it's worth the full price you'd have paid your retailer. If nothing needs it, it flows out to the grid and earns a feed-in credit, which in Victoria is now a small fraction of that price.

This is why two neighbours with the same system on the same roof can see quite different returns. One is home through the day, running the dishwasher and the heat pump while the sun is up. The other is out until six, and most of what the roof makes leaves the property. It's also why we ask who's home on weekdays before we show you a number.

03Why bigger isn't automatically better

The first few kilowatts on a roof work hardest, because nearly everything they make gets used. Each one you add after that covers a little less of your own use and exports a little more. Past a certain size, extra panels are mostly earning feed-in credits.

That doesn't make the smallest system the right one either. Every installation carries costs that are the same whatever its size, so there is a point where a system is big enough to cover your days properly without paying for output you'll mostly give away. Finding that point for your home is most of the job. When our simulator thinks going bigger wouldn't save you more, it says so.

04What a battery changes

A battery moves the middle of the day into the evening. Instead of exporting your surplus for a small credit and buying it back after dark at full price, you keep it. The share of your home that runs on its own power goes up, and the bill comes down further.

It also adds to the cost, so a system with a battery usually takes longer to pay for itself than the same solar without one, even though it saves more each year. Whether that trade is worth it depends on how much you use after dark. If a home uses very little at night, a battery won't pay its way, and we'll tell you that rather than sell you one.

The honest answer to 'what's the payback?' is 'on whose bill?'

05Payback is not the whole return

Payback is the day the savings add up to what the system cost. It's a useful number, but it's the start of the return, not the measure of it. A well-built system keeps working for many years after that day, and everything it saves from then on is yours.

So two systems with the same payback aren't necessarily equal. What matters as much is what happens next: how well the equipment lasts, and who you call if it doesn't.

06What nobody can promise

Any payback figure is an estimate, ours included. Electricity prices move. Your household changes: an electric car arrives, the kids move out. Some years are simply sunnier than others.

We work savings out at today's prices, month by month from Melbourne's long-term sunshine record, and round down. If prices rise, you'll save more than we said. We'd rather that than the other way round.

Incentives are their own subject. The federal incentive for solar steps down at the start of each year, and Victoria's rebates have their own eligibility rules. Both are best read at the source.