How to calculate solar savings
A plain-English guide to calculating UK solar savings from generation, self-consumption, export income and payback.
Key takeaways
- Self-used solar is usually valued at your import unit rate.
- Exported solar is valued at the export tariff you can actually access.
- Payback is upfront cost divided by annual bill savings plus export income.
The basic formula
Annual solar benefit = self-used solar value + export income. Payback years = upfront system cost divided by annual solar benefit.
The common mistake is valuing every kWh of generation at the import unit rate. That only works if you use every kWh at home, which most households won't without the right demand pattern or storage.
Step 1: estimate generation
Start with annual generation in kWh. If you only know the system size, a rough early planning range is 800 to 1,000kWh per kW installed each year. A 4kW system might be modelled around 3,200 to 4,000kWh before roof-specific checks.
PVGIS or an installer design should replace the shortcut once you have roof direction, pitch, shading and location details.
Step 2: split self-use and export
Self-consumption is the share of solar electricity used in the home. Export is the rest. If a system generates 3,600kWh and you use 35% at home, that is 1,260kWh self-used and 2,340kWh exported.
Daytime occupancy, smart appliance scheduling, EV charging and batteries can change that split. So can a strong export tariff, because exporting isn't always a bad outcome.
Step 3: apply current rates
For import value, use your actual electricity tariff if you know it. The calculator currently uses 24.7p/kWh as a rounded default because Ofgem's Direct Debit average for 1 April to 30 June 2026 is 24.67p/kWh. Ofgem has also announced 26.11p/kWh for 1 July to 30 September 2026.
For export value, use the SEG or export tariff you can actually access. Ofgem says SEG licensees choose the tariff rate and contract terms, but the rate must be above zero.
A quick worked example
Take 3,600kWh of annual generation, 35% self-consumption, a 24.7p/kWh import rate and a 15p/kWh export rate. Self-used solar is worth about £311 a year. Exported solar is worth about £351 a year. The annual benefit is about £662.
If the installed cost is £7,000, simple payback is about 10.6 years. Change the export tariff, generation estimate or self-consumption figure and the answer changes quickly.
Sources checked
- Ofgem energy price cap unit ratesCurrent unit-rate context for electricity tariffs.
- Ofgem SEG supplier listCurrent SEG licensee list and annual supplier status.
- European Commission PVGISSolar radiation and PV performance estimates by location.