Solar LCOE Calculator

Calculate the levelised cost of solar electricity over the system lifetime.

About Solar LCOE Calculator

LCOE discounts both cost and generation, which is essential — discounting only the cost would flatter the result. Rooftop solar typically lands between 5 and 12 cents per kWh, well below retail tariffs in most markets. LCOE is the only fair way to compare solar with grid electricity, because it accounts for the up-front cost being spread across decades of output.

Formula

Solar LCOE

LCOE = discounted lifetime cost ÷ discounted lifetime generation

LCOE: Cost per kWh over the whole life, the standard comparison between energy sources
discounting: Applied to both cost and generation so the ratio is consistent

Worked example

With the default values below, Solar LCOE Calculator returns Levelised Cost of Energy of $0.10659. Change any input above and every figure here is recalculated in your browser.

Inputs used

Total installed costminimum 0: 9,000
First year generationminimum 1 kWh: 6,500 kWh
System lifetimeaccepts 1–50 years: 25 years
Annual degradationaccepts 0–100 %: 0.5 %
Discount rateaccepts 0–100 %: 4 %
Annual maintenance costminimum 0: 80

Results

Levelised Cost of Energy: $0.10659
Lifetime Generation: 153,114 kWh
Discounted Lifetime Generation: 96,159 kWh
Total Discounted Cost: $10,249.77
Undiscounted Cost per kWh: $0.07184

Step by step

1Values used
2Solar LCOE
3Levelised Cost of Energy= 0.10659 per kWh
4Lifetime Generation= 153,114 kWh
5Discounted Lifetime Generation= 96,159 kWh
6Total Discounted Cost= 10,249.77
7Undiscounted Cost per kWh= 0.07184

Assumptions and limits

The result is derived only from the 6 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation or tax into account.
Figures are rounded for display to 5 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

How is Solar LCOE calculated?

LCOE = discounted lifetime cost ÷ discounted lifetime generation LCOE discounts both cost and generation, which is essential — discounting only the cost would flatter the result. Rooftop solar typically lands between 5 and 12 cents per kWh, well below retail tariffs in most markets.

Why does Solar LCOE matter?

LCOE is the only fair way to compare solar with grid electricity, because it accounts for the up-front cost being spread across decades of output.

What values do I need to enter?

This calculator takes 6 inputs: Total installed cost, First year generation, System lifetime, Annual degradation, Discount rate, Annual maintenance cost. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.