Inflated Solar Production Estimates
This 8 kW system will produce about 12,800 kWh a year, which covers 120% of your usage.
What's actually true
Production depends on your location, roof direction, tilt, shading and system losses. Estimates that ignore shading, skip degradation or use optimistic losses can overstate output, and every savings number built on it, by a wide margin.
Every savings figure in a solar quote starts with one number: how many kilowatt-hours the system will make each year. If that number is too high, the savings, payback and “offset” percentages are all too high with it. Overstated production often comes from ignoring shade, using the wrong roof direction, applying unrealistically low losses, or skipping the slow decline in panel output over time. You can check it yourself for free.
Why it happens
Some of it is careless software defaults. Some is deliberate. Higher production makes a bigger system look justified and makes the payback look shorter. It also lets a rep promise more than your utility bill, which sets up the $0 bill promise.
The three most common inflation tricks
- No shading. Trees, chimneys and nearby buildings can cut output a lot, especially on part of a string. A proposal with no shade analysis on a shaded roof is a guess.
- Optimistic losses. PVWatts, the free tool from the national lab formerly known as NREL (now the National Laboratory of the Rockies), uses default system losses of about 14% (soiling, wiring, mismatch, availability and more). A quote using 5% losses will look about 10% better on paper.
- No degradation. Panels lose output slowly. A common planning figure is about 0.5% a year for quality modules, based on NREL research. Real-world fleet data shows a median closer to 0.75% a year, higher in hot climates. A 25-year model with flat output overstates lifetime production by roughly 6% or more.
A worked example
An 8 kW system. Numbers are for illustration; your location will differ.
| Quote | Your PVWatts check | |
|---|---|---|
| Output per kW per year | 1,600 kWh | 1,300 kWh |
| First-year output | 12,800 kWh | 10,400 kWh |
| Year-25 output with 0.5%/yr degradation | 12,800 kWh (none applied) | about 9,200 kWh |
| First-year value at 18.3¢/kWh | $2,342 | $1,903 |
The quote overstates first-year value by about $440, and the gap grows each year. If the rep also oversized the system to “cover” the inflated figure, you pay for panels you may not need. See oversized systems.
How it shows up in a proposal
- A single annual kWh number with no inputs shown
- “Solar access 100%” or “TSRF 100%” on a roof with visible shade
- Azimuth (direction) or tilt that doesn’t match your roof
- A 25-year production table where each year is identical
Questions to ask
- “What software made this estimate, and can I see the full report?”
- “What shading, losses and degradation did you assume?”
- “What kWh per kW per year does this work out to?”
- “Is there a production guarantee? What does it pay per kWh if output falls short?” (Many pay little. See weak production guarantees.)
How to check it yourself
- Open PVWatts (search for “PVWatts calculator”; the lab’s web address changed in 2026, so make sure you’re on the official national lab site).
- Enter your address, system size in kW, roof tilt and direction, and leave losses at the default.
- Divide the annual kWh by system size. Compare it with the quote.
Our production checker walks you through this, and system size calculator shows what size you actually need. Compare several quotes on the same basis with compare quotes. Our guides on how to compare solar quotes and checking if your system is working cover what to do after install.
Bottom line: If a quote’s kWh per kW is more than about 10% above PVWatts for your roof, ask the installer to explain exactly why.
Where to report it
If production was misrepresented and the system never came close, report it to your state attorney general and the FTC at reportfraud.ftc.gov. If the installer is licensed, file with your state contractor board.
Related red flags
Solar Systems Sized Bigger Than You Need
Panels beyond what your home uses often earn far less than retail, especially under net billing, where exports may be credited at a few cents per kWh. Extra capacity raises the price faster than it raises savings.
Production Guarantees That Pay Pennies
Many production guarantees cover only a portion of the estimate, pay shortfalls at a low per-kWh rate, measure over several years, and have exclusions for weather, shading and outages. In practice they rarely make you whole for an overstated estimate.
Inflated 25-Year "Lifetime Savings" Numbers
Lifetime savings headlines usually add up 25 years of future dollars as if they were worth the same as today's, assume you stay the whole time, and sometimes count tax credits or inflated rate increases as savings. The real value is usually much smaller and depends on what else you could do with the money.
"Your Electric Bill Will Be $0"
Most homes with solar still get a utility bill every month. Fixed customer charges, minimum bills, low export credits under net billing, and winter months with less sun mean a $0 bill is rare.
"Electric Rates Go Up 6% to 8% Every Year"
From 2005 to 2025, average U.S. residential electricity prices rose about 3.1% a year, or about 0.5% a year after inflation (EIA and BLS data). Some years and some states spike higher, but a 6% to 8% yearly assumption for 25 years inflates savings a lot.