Resources / 2026 global solar IRR ranking

2026 Global Residential Solar IRR Ranking

We modeled a standardized 6 kW residential system in 30 countries using the same engine behind this site's calculator. The headline: solar return on investment is driven far more by your electricity price and install cost than by how sunny it is.

How to read this ranking

Every country uses identical assumptions so the comparison is apples-to-apples: a 6 kW rooftop system, 25-year life, no loan, no subsidies, 50% self-consumption, and the residential loss preset. Only three things vary by country: local turnkey install cost (per watt), local residential electricity tariffs, and local solar irradiation. IRR is the annualized return; payback is years to recover the upfront cost from bill savings.

Sunshine is not the story — price and cost are

The ranking overturns the "more sun = better solar" intuition. Saudi Arabia and the UAE have among the highest irradiation on the list, yet rank 25th and 21st. The reason is simple: electricity there is extremely cheap (around 0.05 USD/kWh), so a rooftop system saves very little per kilowatt-hour. Australia ranks first not because it is the sunniest, but because it pairs strong sun with high retail electricity prices and low install costs. Canada sits last because low irradiation meets high install cost and modest tariffs.

This is why a single global "solar is X% profitable" claim is misleading. The same panels can return 25% in one market and under 1% in another. The quality of the panels matters far less than the local economics.

Why the United States looks low here

The U.S. base case lands near the bottom at 1.9% IRR. That reflects high installed cost and a subsidy-free model. The old 30% federal residential credit should not be assumed for new Section 25D expenditures after December 31, 2025, so a 2026 U.S. homeowner needs to verify state, utility, net-metering, and battery incentives locally. Treat the table as a baseline, not a prediction of any specific homeowner's outcome.

Methodology and limits

• Engine: the same PV Yield calculator model (simulateInvestment) used across this site, with PVGIS/NASA-class weather inputs.
• Install cost and tariffs use indicative residential defaults per country; actual quotes vary widely by state, province, and installer.
• Irradiation is a representative annual value per country, not a site-specific roof assessment.
• No incentives, tax credits, or net-metering specifics are modeled. Adding them changes country order.
• Self-consumption is held at 50% everywhere; higher self-use (common with batteries or daytime load) raises IRR.

These are model estimates for comparison and education, not investment advice. Run your own numbers with local quotes and tariffs in the calculator before making any decision. The embedded ranking below can be reused on other sites with attribution.

Reuse this data

A self-contained, embeddable version of the ranking table is available for publishers: open the embeddable IRR ranking. It is free to embed with attribution to PV Yield.

Explore the drivers yourself: solar panel efficiency, best solar panels 2026, and 2026 residential solar policy. Or jump straight into the calculator with your own roof, quote, and tariff.