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How To Calculate Solar Power Cost Per KWH

With the rise in awareness of solar energy, many people are looking to make a switch, but want to understand the solar power cost per kwh before making a final decision. Indeed, this is a very important calculation because it is going to be the determining factor in what your overall energy cost savings will be if you switch to solar.

First, we must define a kilowatt hour, or kwh. This is simply the way we measure electricity. Just as when you purchase gas, you measure in gallons, when using electricity, you’re measuring in kwh. In order to come up with the kwh, you need to take the wattage of a given device and multiply it by how many hours you use it.

You now have watts per hour; in order to get to kilowatts, you just need to divide the result by 1000.


Next, you’ll have to see how much you are paying per kwh by examining your electricity bill. Electricity rates vary so much in different areas that the only way to know will be to check your bill. So now that you understand a bit about how it works, you can go about coming up with a real calculation of the solar power cost per kwh.

So, now we need to see how many kwh a solar panel produces per day. Since not all solar panels are created equally, we’ll have to take an average number. You can do this with an exact number when you’re shopping for solar panels and are able to have an idea of how many kwh the one you’re looking at produces.

In most cases a solar system generates about 5 hours a day of energy and about 9 watts per square foot. So, following the standard example of a 200 square foot roof, you’d multiply that by 9 watts per square foot and come up with 1800 watts (or 1.8 kw) of power. Using the 5 hour average of peak sunlight hours per day, you can multiply

1.8 watts by 5 hours by 365 days in a year = 3285 kwh per year.

This is the average amount of energy you won’t be paying for during that year. This is the best way to determine the solar power cost per kwh and figure out how much a solar panel will save you over the course of a year. If you want to do it using a specific number of panels rather than average roof size, you can find more info in our tutorial on calculating how many panels you need to power your house.