Understanding total cost of ownership
What total cost of ownership includes
Total cost of ownership combines your net system cost after any tax credit, ongoing maintenance, and one-time inverter replacement, then compares that all-in cost against your projected lifetime savings. It's the most complete single figure for understanding solar's real financial return. For the official overview, the US Department of Energy's homeowner's guide to going solar covers buying, leasing, and system sizing.
Why the tax credit default matters
The 30% federal residential solar tax credit, Section 25D, expired for systems placed in service after December 31, 2025, under the One Big Beautiful Bill Act. The default in this tool is 0%, accurate for a new cash or loan purchase in 2026 or later. Only select the 30% option if your system was placed in service by the end of 2025. See the ITC applied calculator for more on current federal credit status. The DSIRE database of state incentives lists the incentives that apply in your state, with links to each program's rules.
A worked example
For a $22,000 system with no federal credit, $61,365 in gross 25 year savings, roughly $4,800 in maintenance, and an $1,800 inverter replacement, total cost of ownership comes to about $28,600, leaving a net lifetime value of roughly $32,760. That's the real financial benefit after every major cost is accounted for. This estimate assumes normal upkeep, and the maintenance cost vs savings net calculator breaks down what that upkeep costs year by year.
What this still doesn't capture
This figure doesn't include financing interest if you took a loan, or the potential resale value boost from having solar installed. See the ROI percentage calculator to express the same numbers as a single return percentage, or the home value increase estimator for the resale angle. If you have not sized the system yet, start with the inverter clipping threshold calculator and bring its kilowatt figure back here.