Solar System in Mallorca

When does a solar system pay for itself in Mallorca?

The system is paid off once saved grid electricity, remunerated surplus, subsidies and usable tax benefit together add up to as much as the investment. How long that takes is decided less by the sun over your roof than by your consumption profile: self-consumed electricity saves the full grid price, while fed-in electricity earns significantly less. The calculator above guides you through these variables and tells you the year in which the system pays for itself.

This page explains what's behind the calculation, where it breaks down, and which formalities apply in Mallorca. For the bigger picture, there's an overview of ecological building and renovation on the island.

How it's calculated

• Annual yield: from system output and the specific yield at your location.
• Self-consumption (autoconsumo, the self-used share): is valued at your grid electricity price, since it replaces exactly this consumption.
• Surplus: what remains goes into the grid and is credited via the compensación de excedentes (compensation for fed-in surplus) — at a lower rate.
• Annual benefit: savings plus credit, minus ongoing costs for maintenance, insurance and monitoring.
• Net investment: purchase price minus any subsidy received and minus the tax benefit you can actually use.
• Payback year: net investment divided by annual benefit, rounded up to the year in which the benefits first exceed the investment.

The calculator works with constant yield and constant prices: no module ageing, no discounting of future savings. A simplification, but an open one — any assumption about future electricity price trends would be guesswork. If you expect rising prices, enter that in the electricity price.

Worked examples

We'll skip made-up sample figures: the calculator above models your case with your system size, your consumption and your tariff.

Special cases

The remuneration for surplus is capped

The compensación simplificada de excedentes (simplified surplus compensation, Art. 14.3 RD 244/2019) can never be worth more than the electricity you draw from the grid in the same billing period. So the credit reduces your bill at most to the fixed grid costs, never to a payout. And this period is at most one month long — it isn't balanced out over the year.

For a house that stands empty in winter, this is crucial: in months without consumption, feeding into the grid brings nothing. The calculator spreads the surplus evenly across the year, so its annual calculation comes out too high for seasonal use.

The IBI rebate is a discretionary provision

The bonificación (rebate) on the IBI, the Impuesto sobre Bienes Inmuebles and thus the Spanish property tax, is only capped nationally: up to 50% a municipality may grant. Whether it does so is entirely down to its ordenanza fiscal, the municipal by-law on levies — two neighbouring towns can decide differently. Almost everywhere it's required: a homologación, i.e. the official approval of the technology installed. And the discount usually only runs for a few years, not permanently. How the property tax is calculated is explained in the article on property tax in Spain.

Two tax deductions that are mutually exclusive

Under the IRPF, the Spanish income tax, two deductions come into consideration. One targets self-consumption installations from renewable sources: for your own residential property 10% of the investment, for measures on an entire residential building 20%, each up to a tax base of €5,000. The other is the older efficiency deduction, linked to the reduction of primary energy consumption: 40% up to a tax base of €7,500.

For the same installation, you only get one of the two. Both require you to be liable for income tax in Spain and to pay enough tax to actually use up the deduction — anyone who only holds a holiday property here usually ends up empty-handed. The calculator can't know this and works exclusively with the amount you yourself enter as a usable tax benefit.

Subsidy and deduction don't apply twice

A public grant reduces the tax base of the deduction: only the part of the investment that you actually bore economically yourself is eligible.

The Balearic subsidy scheme

The Balearic regional government issues subsidy rounds for self-consumption from renewable energy at irregular intervals through the Conselleria d'Empresa, Ocupació i Energia. The amount, budget and application window change with every Convocatoria (call for applications) and are announced in the BOIB, the official gazette of the Balearics; rounds generally run on a first-come, first-served basis, i.e. until the budget is used up. Precisely for this reason, the calculator takes the subsidy as an input rather than assuming it: what you actually get is stated in your approval notice, not in a table that will be outdated by the next programme. There are two things you should know here. First, an approved subsidy reduces the tax base of the deduction — so it doesn't apply twice, and this already applies once the subsidy has been finally approved, even if it hasn't yet been paid out. Second, it's worth checking your own municipality: whether and for how long it reduces the property tax for solar installations is set out in its ordenanza fiscal, not in the regional programme.

Deadlines and evidence

• Bonifikation: It doesn't apply automatically. You apply for it at your municipality, usually in the year after installation and within a deadline stated in the ordenanza fiscal, with the homologación and invoice.
• Deduction for self-consumption installations: The installation must be completed in 2026, and as proof the CIE, the Certificado de Instalaciones Eléctricas, is used — the commissioning certificate for the electrical installation, which your installer has registered.
• Older efficiency deduction: Here you need two energy performance certificates, one before and one after the works — the first must therefore be in place before construction begins. In addition, payment must have been made within the qualifying period.

Legal basis

The IBI rebate is set out in Art. 74.5 of the Spanish Local Taxation Act (TRLRHL), which establishes the maximum rate. The two income tax deductions appear as Additional Provisions 62 and 50 in the Spanish Income Tax Act. The compensation for surplus energy fed into the grid follows from Art. 14.3 RD 244/2019 on self-consumption of electricity. The current legal status and official references are shown by the calculator itself.

Permits and legal pitfalls

Structurally, a rooftop installation is usually straightforward, but legally on Mallorca it isn't always — especially with older fincas. Before commissioning the work, clarify:

• Is there a valid building permit or a Final de Obra in place? Which documents the town hall expects is covered in the article on when you need a building permit on Mallorca.
• Is the Cédula de Habitabilidad, the habitability certificate, missing? It serves as proof of legality, especially for off-grid fincas; we explain separately how to obtain it.
• Is the building under heritage protection? Then requirements on the visibility of the panels often apply — you can read here what BIC status means in practice.
• Is the plot located near the coast? the setback zones set out under the Ley de Costas are summarised here.
• Is the building not fully legalised? Then first clarify the steps for retroactively legalising an unauthorised build (Schwarzbau).
• Shared roof? Then a formal resolution is required; which majorities are needed within the Comunidad de Propietarios is set out here.

Finding the right specialist firm

The installer determines the quality of the system, the timeline and the completeness of the documentation. A good starting point is our directory of solar companies on the island. Most of the public Google reviews have been gathered there: the top-rated provider from Palma, a company operating in the north around Pollença, an installer based in the Son Castelló industrial estate, a specialist firm from Inca serving the island's interior and a a German-speaking company based in Palma. This is a guideline, not a recommendation — get several quotes.

Most common mistakes

• Planning the system too large. Anything above your own needs becomes surplus and is therefore paid less — with seasonal use, it drops almost entirely out of the calculation.
• Claiming the grant and the tax deduction twice over. The grant reduces the assessment base.
• Counting on a tax advantage you can't actually use. Without a tax liability in Spain, the deduction goes nowhere.
• Only seeking the legality certificate at the end. Obtaining it takes longer than the installation itself.
• Not having the CIE registered. Without a registered commissioning certificate, the self-consumption deduction won't be recognised.
• Not applying for the rebate. The municipality doesn't grant it automatically, and deadlines are rarely interpreted generously.

Checklist before commissioning

• Work out your annual consumption from the electricity bills, split between summer and winter.
• Estimate a realistic self-consumption share, not the one from the quote.
• Track down the building permit, Final de Obra or Cédula, and check heritage protection and coastal restrictions.
• For a shared roof, put the resolution on the agenda.
• Get quotes including a yield forecast, and record the CIE registration in writing.
• Check your municipality's ordenanza fiscal for the rebate.
• Clarify with your tax adviser which deduction applies — for the efficiency deduction, have the energy certificate drawn up before construction starts.

Related calculators

For the running costs of your property, the calculator for Spanish property tax can help, and before the panels go up on the roof, it's best to clarify step by step how to register a photovoltaic system in Mallorca.