Payback is the number of years it takes for your electricity savings to equal the system’s cost and maintenance.
Once you have estimated your system’s kilowatt-hour production, you need to determine your annual kilowatt-hour (not dollars but kilowatt hours) use of electricity. This is normally available from your electric service provider. Use an average of two years consumption for this figure.
Next look at the cost of your electricity. Again, look at the rates you have paid over the last two years and get an average. It does fluctuate. Now add at least 2.5¢ per year for cost increases. That is the average increase based on many past years. Increases will probably be much larger than that in the future.
If you live in an area where net metering is not available, the payback for your system will take longer. Energy-efficiency then becomes a major player in your payback time.
You certainly need to make your home as energy efficient as possible. However, it is not necessary to do your energy-efficient improvements before installing renewable energy or even do it in the same year.
It is important to get a plan for both energy efficiency and renewable energy installation from a professional, then stick to it.