What is the ROI of solar panels in Florida?

For an unshaded home paying cash, we estimate about 7.8% to 9% a year over 25 years if rates rise 2.5% a year, with payback around 12.9 years on FPL. Shade, price and how long you stay change it.

Is solar a better investment than the stock market?

Not on average return: stocks have averaged about 10% a year since 1957. But solar's return doesn't swing from year to year, and bill savings generally aren't taxed like gains. The tradeoff is that the money is tied to your home.

Should I pay off my mortgage or buy solar in Florida?

Compare your mortgage rate with solar's estimated return, about 7.8% for an unshaded FPL home. With a low-rate mortgage, solar usually wins; with a rate near that figure, shade or a high quote can tip it toward paying down the loan.

Are solar savings taxable in Florida?

Lower bills aren't a payment you receive, so they generally aren't taxed like interest or dividends. Ask a tax professional about your situation.

Is Solar a Good Investment in Florida? Returns vs. Stocks

Quick answer

For an unshaded Florida home paying cash, our estimates show solar earning about 7.8% to 9% a year over 25 years if electric rates rise 2.5% a year, or 5.4% to 6.6% if they stay flat. That beats most CDs and at least matches a 10-year Treasury near 5%. It trails stocks' long-run 10% average, but without the swings, and the money stays tied to your house.

What return does solar earn in Florida in 2026?

Estimated return on a cash purchase, unshaded home with a $200 monthly bill, over 25 years
Utility	Price	First-year savings	Payback	Flat rates	Rates up 2.5%/yr	Rates up 4%/yr
FPL	$25,900 (9.6 kW)	$2,012	12.9 yrs	5.4%	7.8%	9.2%
Duke Energy Florida	$23,800 (8.8 kW)	$1,954	12.2 yrs	6%	8.4%	9.8%
Tampa Electric	$24,800 (9.2 kW)	$2,153	11.5 yrs	6.6%	9%	10.5%

The return is the yearly rate (the internal rate of return) that 25 years of bill savings earn on the price you pay. It uses the same model as our solar savings calculator: $2.70 per watt, no rebate or federal credit, panels losing 0.5% of their output a year, and every kWh credited at the full retail rate under Florida's net metering rule. It leaves out inverter replacement, maintenance and repairs, so read it as the result for a fairly priced, unshaded roof with no surprises.

Bill size barely changes the answer. Because each kWh is worth the full retail rate, a $300 FPL bill (a 15.2 kW system at $41,000) earns about the same 7.8% as a $200 bill. Tampa Electric comes out highest in our model, mostly because its price per kWh is the highest of the three.

How is solar's payback and return calculated?

1
Start with the price
Florida has no state or utility rebate, and the 30% federal homeowner credit ended for systems completed after 2025, so a cash buyer's cost is the installed price.
2
Estimate first-year savings
Multiply the kWh the panels make in a year, up to what the home uses, by your all-in retail rate. Florida pays only a few cents per kWh for a yearly surplus, so systems are sized to match use.
3
Work out simple payback
Divide the price by first-year savings. It's easy to compare, but it ignores every year after the payback year.
4
Find the annual return
Find the yearly rate at which 25 years of savings, rising with electric rates and shrinking 0.5% a year as panels age, are worth exactly the price today. That rate is the return in the table above.

How does solar compare with Treasuries, CDs and stocks?

Solar's estimated return next to common alternatives, autumn 2026
Option	Return	Notes
Home solar, cash purchase (our estimates)	About 7.8% to 9% a year (5.4% to 6.6% if rates stay flat)	Paid as lower bills; depends on your roof, your rates and how long you stay
10-year U.S. Treasury	About 5% (weekly average 4.99% at the end of October 2026)	Fixed if held to maturity; it topped 5% in September 2026
1-year CD	National average under 2%; best nationally advertised rates up to about 4.65% (late October 2026)	Fixed for the term, then resets
S&P 500 stock index	About 10% a year on average since 1957; about 6.5% after inflation	Swings widely from year to year
Paying down your mortgage	Your loan's interest rate	A guaranteed saving; better the higher your rate

Compare like with like. Solar's figures, like the stock market's 10%, are before inflation. Solar's return isn't guaranteed the way a Treasury's is, but it doesn't swing like stocks either: it depends on your roof, what electricity costs and how long you own the home. And the money is tied to the house, so you get it back by staying or by selling to a buyer who values the system.

For the mortgage question, compare your rate with solar's. If your loan's rate is well below the 7.8% the FPL example earns, solar usually beats extra principal payments; if your rate is close to it or above, paying down the loan is the safer win.

How do taxes change solar's return in Florida?

Mostly in solar's favor. Bill savings aren't a payment you receive, so they generally aren't taxed the way interest, dividends or stock gains can be. That makes a solar return worth more next to a taxable investment earning the same rate. Ask a tax professional about your own situation, including the small year-end payout Florida utilities make for unused credits.

Florida also exempts solar equipment from its 6% sales tax, and s. 193.624 keeps the value solar adds out of your home's assessed value, so the system doesn't raise your yearly property tax. Our prices already assume no sales tax, so don't count that exemption twice. See Florida solar incentives, will solar raise my property taxes? and does solar increase home value?

What happens to the return if FPL rates keep rising?

It goes up, and if rates stall it goes down. Our model assumes rates rise 2.5% a year, about Florida's 10-year average in EIA data. At flat rates, the FPL example earns about 5.4%; if rates rose 4% a year, about 9.2%. The 4% case is a what-if, not a forecast.

Near-term bills point both ways. FPL has asked regulators to raise its typical 1,000 kWh bill to $141.87 in January 2027, including a storm surcharge for Hurricane Isaias, while the PSC approved lower 2027 rates for Duke Energy Florida. See Florida electric bills in 2027 and why your FPL bill is so high.

What could lower your solar return?

Repairs and upkeep. The model leaves out inverter replacement and maintenance. Check what the equipment warranties cover; see microinverters vs. string inverters.
Faster panel aging. NREL's median is 0.5% a year, but its fleet data found about 0.88% in the hottest climates. At that rate, the FPL example drops to about 7.5%.
Shade. With some shade on the roof, our FPL example earns about 6.2%.
Overpaying. A price 10% above our estimate ($28,500 for the FPL example) cuts the return to about 6.8%. Check any quote with our quote checker.
Moving early. You earn the return by staying, or by getting the system's value back when you sell.
Rule changes. Full-retail credit comes from a PSC rule. A bill to phase it down was vetoed in 2022, but rules can change. See Florida net metering.

When is paying cash better than financing?

When the loan costs more than solar earns. If a loan's rate, plus any dealer fee built into the price, is near or above the 7.8% the FPL example earns, the interest eats most of the return. Cash, or a cheaper loan, keeps more of it. See solar loans in Florida.

Leasing is the other route: the leasing company can still claim a business tax credit that cash buyers lost, but it owns the system and keeps the upside. Compare the two in solar lease vs. buy, or enter your own bill in the solar savings calculator.

Sources

This guide is general information, not tax, legal or financial advice. Incentive programs change, so confirm current terms with your installer, your utility and a tax professional.

Is solar a good investment in Florida?