Rooftop solar is a way for many U.S. homeowners to cut electricity bills by about $50 to $200 per month. A typical home may save approximately $80 to $140 per month before financing costs, depending on system output, electricity rates, roof conditions and the utility's payment for excess power.
The U.S. Energy Information Administration reported average residential electricity use of 865 kWh per month in 2024. The average U.S. residential electricity price was 18.19 cents per kWh during the first seven months of 2026. Those figures produce an illustrative electricity cost of about $157 per month, before utility-specific charges and taxes.
A solar loan, lease or power purchase agreement can reduce your actual cash savings because the monthly solar payment comes out of the bill reduction.
Estimated Monthly Solar Savings
The table below shows potential electricity-bill savings before financing, fixed utility charges and maintenance.
| Pre-solar electricity bill | 50% bill reduction | 80% bill reduction | 90% bill reduction |
|---|---|---|---|
| $100 per month | $50 | $80 | $90 |
| $150 per month | $75 | $120 | $135 |
| $200 per month | $100 | $160 | $180 |
| $300 per month | $150 | $240 | $270 |
Solar may not remove the entire utility bill. Many utilities continue to charge a monthly service fee, and electricity exported to the grid may receive a lower credit than the retail rate.
What Is the Typical Savings for an Average U.S. Home?
For the illustrative $157 monthly electricity cost above:
- A 50% reduction would save about $79 per month
- An 80% reduction would save about $126 per month
- A 90% reduction would save about $141 per month
Dollar savings can be higher for homes in areas with expensive electricity or high energy use. Air conditioning, electric heating, pool equipment and electric vehicles can all increase the amount of electricity a home uses.
How to Calculate Your Own Monthly Solar Savings
Use this basic calculation:
Monthly solar savings = pre-solar electricity bill - post-solar electricity bill
For a more complete estimate:
Annual savings = value of solar power used at home + value of excess solar exported to the grid - remaining utility charges
That value depends on how much electricity the panels produce, how much power the home uses while the panels are generating electricity and how the utility credits exported power.
The National Renewable Energy Laboratory's PVWatts Calculator estimates solar production using the home's location, system size, roof direction, tilt, shading and other system details.
Why Solar Savings Vary From Home to Home
Electricity Rates
Solar saves more money where electricity costs more. A system that produces the same amount of electricity will usually deliver greater dollar savings in a high-rate utility territory than in an area with lower rates.
Solar Production
A roof with strong sunlight and little shade will produce more electricity than a shaded roof. Roof direction, roof angle, local weather, system size and panel orientation all affect production.
Net Metering and Export Credits
Solar panels often produce more electricity than the home is using during the middle of the day. The excess can go to the grid in exchange for a bill credit.
Some utilities provide close to the full retail rate for exported electricity. Others use lower export rates. That difference can change the financial return from solar.
Electricity Usage
A home using 1,500 kWh per month may receive more dollar savings from solar than a home using 500 kWh per month, even when the systems are similar in size.
Fixed Utility Charges
Solar usually reduces usage-based charges, but it may not eliminate connection fees, minimum bills, taxes or other fixed charges. You may still receive a utility bill even when the panels produce most of your electricity for the year.
What Are the Net Savings After a Solar Loan or Lease?
Your gross solar saving is the reduction in your utility bill. Your net monthly saving is:
Net monthly saving = electricity-bill reduction - solar payment - additional fees
For example:
- Previous electricity bill: $200 per month
- New electricity bill after solar: $50 per month
- Solar loan payment: $100 per month
- Net monthly saving: $50 per month
A cash purchase has no monthly solar payment, but it requires a large upfront investment. A solar lease or power purchase agreement may require little or no upfront payment, but its contract payment reduces the monthly benefit. The U.S. Department of Energy makes the same distinction when comparing utility-bill savings with solar financing payments.
Do Solar Panels Eliminate Your Electricity Bill?
Solar panels can eliminate most usage-based electricity charges, but they do not always eliminate the entire bill.
Your remaining bill may include:
- Fixed utility service charges
- Electricity purchased at night
- Electricity purchased during cloudy periods
- Demand or time-of-use charges
- Lower-value credits for excess electricity
- Battery or solar financing payments
Solar production changes throughout the year. Panels may generate more electricity in summer, while winter weather and shorter days can reduce production. Compare annual electricity costs rather than relying on a single monthly bill.
Does the Federal Solar Tax Credit Increase Monthly Savings?
The federal Residential Clean Energy Credit was available for qualified residential solar installations placed in service through December 31, 2025. The Internal Revenue Service states that the credit is not available for property placed in service after that date under current law. State, local and utility incentives may still exist, but eligibility varies by location.
Bottom Line
Your own savings estimate should use the last 12 months of electricity use, your utility's current rates and its export-credit policy. Model the roof with NREL's PVWatts Calculator, then compare the expected bill reduction with the full solar payment.
The useful number is not the advertised panel savings. It is the amount left after utility charges, financing and other fees.