How We Calculate Your Solar Potential: Explained in Plain English
Introduction
When you click a point on the Swales map, a solar card appears showing numbers like "Coverage Ratio 67%" or "Bills offset: 8 months per year." These are not guesses or marketing estimates. Every single number comes from a specific calculation built on real solar science, real energy economics, and real climate data.
Most solar calculators give you a headline figure and stop there. We think you deserve to understand exactly how that number was produced, because understanding it is what allows you to trust it. This article walks through every formula, every assumption, and every number we use — in plain English, with real examples, so you can evaluate what you are looking at before you spend a penny.
Step 1 — How Much Sun Actually Hits That Spot?
Everything starts with two measurements pulled from the Global Solar Atlas, a global database of satellite-based solar measurements built over decades of observation.
The first is GHI, which stands for Global Horizontal Irradiance. GHI tells you how much total solar energy falls on one square metre of flat ground at your location in a typical year. Think of it as a weather measurement for sunlight, like rainfall but for solar energy. It is measured in kilowatt-hours per square metre per year.
A location in Egypt receives around 2,000 kWh/m²/year. London receives about 1,050 kWh/m²/year. Greenland sits at around 750 kWh/m²/year. The higher the number, the more raw solar energy is available. But GHI alone does not tell you how much electricity you will actually generate, because that depends on how efficiently your panels convert sunlight. We use an industry-standard panel efficiency of 20 percent, meaning a panel converts roughly one fifth of the sunlight that hits it into usable electricity.
The second measurement is PVOUT — the number we actually use for all calculations. It answers a very specific question: if you installed one kilowatt of solar panels at this location, how many kilowatt-hours of electricity would they produce in one year? Cairo comes in at around 1,800 kWh per kilowatt per year. London sits at around 900. Stockholm is around 850. This is where solar geography becomes very tangible. Every kilowatt of panels you install in Cairo produces twice the electricity of the same panels in London, at the same price, with very different results on your bill.
Step 2 — What Size System Are We Calculating For?
You cannot calculate a coverage ratio without knowing the size of the solar installation. Rather than asking you to specify a system size — most people have no idea where to start — we use standard benchmark sizes that represent typical real-world installations for each type of user.
For a residential home, we calculate based on a 3 kilowatt system, which represents a typical rooftop installation of eight to ten standard panels. For a farm or NGO, we use 20 kilowatts, which covers barns, irrigation pumps, and basic operations. For a small commercial building or office, we use 25 kilowatts, which suits a rooftop of a light industrial unit or office block. For an industrial site, we calculate based on a 1 megawatt ground-mounted solar park, which is the scale at which large factories begin to make serious investments in generation.
These are starting points, not prescriptions. A larger installation at your location would increase the coverage ratio proportionally.
Step 3 — The Real-World Loss Factor: Why You Never Get 100 Percent
In a perfect world, a 3 kilowatt system in a location producing 1,000 kWh per kilowatt per year would generate exactly 3,000 kilowatt-hours. In the real world, it generates around 2,460 kilowatt-hours — roughly 18 percent less. We apply a system loss factor of 0.82 to every calculation, and this single number captures all the real losses that happen between the sun and your electricity metre.
The losses break down like this. Inverter losses account for around 5 percent. Your panels produce DC power, but your home runs on AC power. The inverter converts between the two, and this conversion wastes a small amount of energy as heat. Cable losses add another 2 percent, as electricity travelling through wires generates heat, particularly on longer cable runs. Temperature losses account for around 5 percent, and this surprises most people: solar panels actually become less efficient as they get very hot. A panel rated at 3 kilowatts in a laboratory at 25 degrees Celsius might only deliver 2.8 kilowatts on a 40 degree summer afternoon. Soiling losses from dust, bird droppings, and leaves sitting on the panel add 2 percent. Gradual panel degradation over time contributes another 2 percent. Occasional system downtime accounts for the remaining 2 percent.
Add these together and you arrive at approximately 18 percent in total losses. We multiply every calculation by 0.82, which is the standard that professional solar engineers use when designing real systems. The practical result: a 3 kilowatt home system in London with a PVOUT of 900 produces 900 multiplied by 3 multiplied by 0.82, giving 2,214 kilowatt-hours per year.
Step 4 — How Much Energy Do You Actually Use?
To know what percentage of your bill solar can cover, we need to know how large that bill is. We use the following benchmark annual energy demands, based on published utility surveys and industry data.
For a residential home, we use 3,600 kilowatt-hours per year, which represents the average UK household running a fridge, washing machine, lights, a television, and phone chargers. At a typical UK rate of 28 pence per kilowatt-hour, this equates to roughly £1,008 per year on electricity. For a farm or NGO, we use 25,000 kilowatt-hours per year, covering irrigation, lighting, and refrigeration on a small to medium working farm. For a commercial premises, we also use 25,000 kilowatt-hours, suited to a small office building. For an industrial site, we use 3,000,000 kilowatt-hours per year, representing the demand of a large factory that would justify a 1 megawatt solar installation.
Every percentage point of coverage ratio translates directly into a percentage reduction in that bill. If your home coverage ratio is 60 percent, you are saving approximately £605 per year against the UK average electricity cost.
Step 5 — The Most Important Insight: You Cannot Bank Summer Sun for Winter
This is the single biggest misconception about solar energy, and getting it wrong produces the inflated results you see in oversimplified calculators. We take it very seriously.
Imagine you live in Edinburgh. In June, your 3 kilowatt system produces 350 kilowatt-hours — more than your entire monthly household demand of 300 kilowatt-hours. You have a surplus. But in December, those same panels produce only 60 kilowatt-hours while your heating-heavy household demands 450 kilowatt-hours. You need to buy 390 kilowatt-hours from the grid.
A naive calculation would say that this system produces 2,200 kilowatt-hours per year and your demand is 3,600 kilowatt-hours per year, so coverage is 61 percent. But this is wrong. You cannot take June's surplus and store it for December without a very large and expensive battery bank. Excess summer production is exported to the grid, often at low rates, while you still pay full price for every kilowatt-hour you draw in winter. We calculate coverage month by month and only count the solar energy you can actually use in that same month. If you produce 350 kilowatt-hours in June but only need 280 kilowatt-hours, we count 280, not 350. If you produce 60 kilowatt-hours in December but need 450, we count only 60. We add up all 12 months of actually usable solar and divide by total annual demand. This gives you a coverage ratio that is consistently 10 to 20 percent lower than the naive calculation — and that is intentional. We want the number to reflect what you will actually experience.
Step 6 — Cold Climates Use More Energy
There is a second problem with applying the same demand figure to both a home in Egypt and a home in northern Sweden. Swedish homes are cold. They run electric heating for six months of the year. A typical Swedish household consumes 6,000 to 8,000 kilowatt-hours per year, not 3,600. Using the UK figure for Sweden would make Swedish solar look far better than it really is.
Rather than maintain a database of average energy demand by country, we detect climate zone automatically using the solar data itself. We calculate the seasonal variation of monthly solar output and use it as a proxy for climate. Locations where solar production swings dramatically between summer and winter tend to be cold climates with high heating loads. Locations with stable year-round sun tend to be warm climates with lower demand.
The adjustment works as follows. In tropical and subtropical locations such as Egypt, the Gulf states, and sub-Saharan Africa, we apply no adjustment. In temperate climates such as the UK, France, Germany, and New Zealand, we increase the assumed demand by 30 percent. In northern continental climates such as Sweden, Canada, and Russia, we increase demand by 80 percent. In subarctic and polar regions such as Greenland, northern Norway, and Alaska, we increase demand by 150 percent.
The result is that Stockholm's solar coverage ratio comes out at around 48 to 52 percent rather than the inflated 70 percent or more you would get using the raw UK demand figure. This reflects the reality that Swedish households consume significantly more electricity than the UK average.
Step 7 — The Coverage Ratio and Your Bill
Putting it all together, the coverage ratio answers the most practical question anyone can ask about solar: how much of my electricity bill will this actually replace?
- 70 to 100 percent coverage: Solar covers most or all of your electricity bill. You use the grid only as a backup on the most overcast winter days.
- 40 to 70 percent coverage: Solar makes a significant dent, roughly halving your bill. A good investment in most locations with reasonable sunshine.
- Below 40 percent coverage: Solar helps but remains supplementary. You will still rely heavily on the grid and the financial case is weaker.
For a UK household spending £1,008 per year on electricity, an 80 percent coverage ratio saves around £806 per year. A 55 percent coverage ratio saves around £554 per year. A small business spending £7,000 per year on electricity with 70 percent solar coverage saves approximately £4,900 per year, pointing to a typical payback period of five to eight years on a £30,000 installation.
Step 8 — When Solar Produces More Than You Need
In very sunny locations, a well-sized system can produce more than your total annual demand even after accounting for winter shortfalls. When the coverage ratio reaches 100 percent, we switch to showing a surplus ratio. This tells you how much of your production exceeds your total demand and could be exported to the grid, potentially earning you an export tariff from your energy supplier.
A home in Cairo with a 3 kilowatt system and a PVOUT of 1,800 produces approximately 4,428 kilowatt-hours per year against a demand of 3,600 kilowatt-hours. The surplus is around 23 percent, meaning you cover all your own needs and export roughly a quarter of your generation back to the grid. In the right location, solar is not just a cost-saver — it becomes a modest income stream.
Step 9 — The Three Traffic Lights
We distil the full solar picture into three traffic lights, each measuring a different dimension of quality. Sun Strength tells you whether there is enough raw sunshine at your location, based directly on annual GHI. Excellent corresponds to desert or Mediterranean sunshine above 1,400 kWh/m²/year. High covers strong solar regions of southern Europe and North Africa. Medium covers northern Europe and parts of Asia. Low signals poor solar resource in very cloudy or very northern climates.
Reliability measures how consistent solar output is throughout the year, based on the ratio between the worst and best month of production. A location that produces well in both summer and winter scores green. A location with a dramatic seasonal swing — where December produces less than 40 percent of what July produces — scores red. This matters because a low reliability score means heavier dependence on grid power in winter months.
Coverage is derived directly from the coverage ratio calculated in the steps above. Surplus production scores green. High coverage between 70 and 99 percent scores green. Partial coverage between 40 and 69 percent scores amber. Low coverage below 40 percent scores red.
Step 10 — One Number That Speaks Your Language
Each type of user gets one tailored practical metric that translates the abstract coverage ratio into something immediately meaningful for their situation.
For a household, we show months of free electricity per year, calculated by multiplying the coverage ratio by 12. A 67 percent coverage ratio means approximately 8 months per year where your solar generation covers your electricity bill entirely. A family that used to pay £84 per month will effectively have eight free months and four expensive months, saving around £670 annually.
For a farm or NGO, we show hectares of drip irrigation supported, based on an average consumption of 1,000 kilowatt-hours per hectare per year for pumping, filtration, and timers. This tells you directly how much cropland your system can irrigate without drawing from the grid or from fossil fuel generators.
For a commercial premises, we show annual bill savings in thousands of pounds, calculated at the UK commercial electricity rate of 28 pence per kilowatt-hour. A 25 kilowatt system in a medium-sunshine location producing 18,000 kilowatt-hours per year saves approximately £5,000 per year.
For an industrial site, we show gigawatt-hours of grid offset per year. At this scale, a 1 megawatt installation producing 820,000 kilowatt-hours per year offsets 0.82 gigawatt-hours of grid electricity. At a grid carbon intensity of around 200 grams of CO₂ per kilowatt-hour, that is approximately 164 tonnes of carbon dioxide avoided annually — equivalent to taking around 70 petrol cars off the road for a full year.
Why We Built It This Way
The reason we built this level of detail into the Swales solar model is straightforward. Decisions about solar installations involve real money. A home system costs £6,000 to £12,000. A commercial system runs to £25,000 or £60,000. An industrial installation is a seven-figure commitment.
Oversimplified calculators that ignore monthly matching, climate-adjusted demand, and real-world system losses consistently produce inflated numbers. Users install systems expecting 80 percent bill coverage and achieve 50 percent. Trust collapses. We built this model to give you a number you can bring to an installer, a bank, or a planning meeting and have it hold up to scrutiny. The result may be less exciting than a flashier tool would show — but it is the number that reflects what you will actually experience on your bill, month by month, year after year.
Frequently Asked Questions
Why does my coverage ratio drop so much in winter?
The monthly matching calculation only counts solar you can use in the month it is produced. In winter, days are short and panels produce far less, while your heating and lighting demand rises. The combination creates a significant gap that the grid must fill. Battery storage can help bridge this gap, but typical domestic batteries only carry surplus from day to evening, not from summer to winter.
Can I improve my coverage ratio by adding more panels?
Yes, increasing system size directly increases the coverage ratio up to a point. However, adding panels beyond a certain size creates surplus in summer without fixing the winter problem. The most effective combination for improving year-round coverage is additional panels plus battery storage, sized correctly for your winter demand profile.
Are these numbers applicable to my specific roof?
The numbers represent the solar resource at your map location and apply to a typical correctly oriented, unshaded installation. Factors specific to your property — roof angle, compass direction, shading from trees or neighbouring buildings — will affect your actual results. We recommend using these figures as a starting point and having a site survey conducted by a qualified solar installer before committing to any investment.