Size your solar system to match your electricity needs.
The key formula is: System Size (kW) = Daily kWh Needed ÷ (Peak Sun Hours × System Efficiency). Peak sun hours vary by location: 3-4 hours in northern Europe, 4-5 in the US Midwest, 5-7 in the Sun Belt, and 6-8 in deserts. System losses of 15-25% account for inverter conversion, wiring, temperature derating, shading, and soiling. A typical US household using 900 kWh/month needs a 6-8 kW system (15-20 panels). Modern residential panels produce 370-425 W each and are approximately 20-22% efficient. Cost has dropped 99% since 1976: from $106/W to under $0.30/W for panels (though installed system cost is $2.50-4.00/W including inverter, mounting, labor, and permitting). A properly sized residential system pays for itself in 5-8 years and lasts 25-30+ years, with panels degrading only 0.5% per year. Net metering allows excess power to be sold back to the grid, potentially eliminating electricity bills entirely.