A generator and a solar system solve the same problem in opposite ways. A generator costs relatively little to buy and a lot to keep running. A solar and battery system costs more upfront and very little to run. The only fair comparison looks at the total cost over several years.
This guide shows you how to make that comparison with your own numbers, whether you run a home, an office or a factory.
What a generator really costs
The purchase price is the smallest part of owning a generator. Over its life you also pay for:
- Fuel. Petrol or diesel, every hour it runs. This is usually the largest cost by far, and it rises and falls with fuel prices you do not control.
- Servicing. Oil and filter changes at regular run-hour intervals, plus plugs, belts and coolant.
- Repairs. Generators that run for many hours a day wear quickly. Starters, alternators and injectors fail.
- Replacement. Small petrol generators in heavy use may need replacing every few years. Larger diesel sets last longer but need major overhauls.
- Hidden costs. Time and transport to buy fuel, theft of fuel, noise, fumes and the risk of carbon monoxide indoors.
What a solar system really costs
A solar and battery system front-loads its cost:
- Purchase and installation. Panels, inverter, batteries, mounting, cabling, protection and labour.
- Maintenance. Panel cleaning, especially during harmattan, and periodic checks of the batteries, inverter and connections.
- Battery replacement. Batteries are the part of the system most likely to need replacing during its life. How soon depends on the battery type and how hard it is worked. See our battery guide.
- Inverter replacement. Inverters usually outlast batteries but not panels.
Once installed, the energy from the panels costs nothing. That is where the savings come from.
Step 1: work out what your generator costs you now
Gather at least three months of records. More is better, because fuel use changes with the seasons and with grid supply.
| Item | How to calculate | Your figure |
|---|---|---|
| Fuel per month | Litres bought per month × price per litre | |
| Servicing per month | Cost per service ÷ months between services | |
| Repairs per month | Last year’s repair bills ÷ 12 | |
| Replacement reserve | Generator price ÷ expected life in months | |
| Monthly generator cost | Sum of the above |
If you do not record fuel purchases, start now. Even four weeks of receipts will make every quotation you receive easier to judge. For a quick first figure, our solar calculator estimates your monthly fuel and grid spend from your generator size and daily hours.
Step 2: estimate what solar would replace
A solar system rarely replaces every generator hour. Ask your installer how many of your current generator hours the proposed system would cover, and on what assumptions about sun, battery size and your daytime and night-time use.
A useful way to think about it:
- Daytime loads can be covered almost entirely by solar on clear days.
- Evening and night loads depend on battery size.
- Long outages and cloudy spells may still need the generator.
If solar covers, say, 70% of your current generator hours (an assumption for illustration only), your fuel and servicing costs fall by roughly that share, and the generator lasts much longer because it runs less.
Step 3: calculate simple payback
Simple payback tells you how long the savings take to repay the system:
Payback in years = system cost ÷ yearly saving
Your yearly saving is the generator fuel, servicing and grid energy you no longer pay for, minus the cost of maintaining the solar system and setting money aside for future battery replacement.
Worked example with assumed figures
These numbers are illustrations only. Replace them with your own records and real quotations.
| Item | Assumed figure |
|---|---|
| Diesel used per month | 400 litres |
| Diesel price | ₦1,000 per litre |
| Monthly fuel cost | ₦400,000 |
| Monthly servicing and repairs | ₦50,000 |
| Share of generator hours solar replaces | 70% |
| Monthly saving (70% of ₦450,000) | ₦315,000 |
| Yearly saving | ₦3,780,000 |
| Set aside each year for solar maintenance and batteries | ₦600,000 |
| Net yearly saving | ₦3,180,000 |
If the system in this example cost ₦15,000,000, simple payback would be about 4.7 years (₦15,000,000 ÷ ₦3,180,000). Change any assumption and the answer changes, which is exactly why you should see these assumptions written down in any proposal.
What makes solar pay back faster
- High daytime use. Offices, shops, schools, clinics and factories that work in daylight use solar power as it is produced.
- Heavy reliance on diesel. The more generator hours you replace, the bigger the saving.
- Rising fuel prices. Every increase makes each solar kilowatt-hour more valuable.
- A right-sized system. Oversizing adds cost that the savings must repay. Undersizing leaves the generator doing too much.
What makes it pay back slower
- Mostly night-time use, which needs more batteries.
- Heavy heating loads, such as cookers and water heaters.
- Shaded or poorly oriented roofs.
- No maintenance. Dirty panels and neglected batteries lose output.
The usual answer: hybrid
For most homes and businesses in Nigeria the answer is not solar or generator, but both. In a hybrid system, solar panels and batteries carry the load first, the grid is used when available, and the generator starts only when the batteries run low. The generator runs far fewer hours, uses less fuel and lasts longer.
If you run a business or factory, our commercial and industrial solar service builds the payback model from your own diesel and grid records. For a home, start with our home solar sizing guide.
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