Are Solar Hot Water Panels a Smart Step?

Scott Gibson

I could get used to the look of solar panels on the roof if I thought the investment made sense. Does it?


As appealing as it might be to say yes, it absolutely makes sense, it's not that simple. A lot depends on where you live, how much hot water you need, and what kind of water heater you currently have.

One thing you can count on is the cost. It won't be cheap, and a solar hot water system is unlikely to produce 100% of your hot water throughout the year.

We priced a hot water system two years ago. It was designed to supplement our oil-fired boiler and indirect hot water tank. The renewable energy company estimated that the 40 evacuated tube collectors mounted on the roof plus an 80-gallon storage tank in the basement would provide "most" of our hot water in spring, summer, and fall. During the long New England winters, the boiler would be on its own.

Installed cost: about $8,000 after a 30% federal tax credit.

Where it gets tricky is in estimating the payback. During the summer we use roughly 1 gallon of No. 2 fuel oil per day to heat domestic water (just two of us here, no teens taking endless showers).

During the winter, when the boiler is running anyway, it doesn't take as much oil to keep the indirect tank satisfied. So I'm guessing we would save 150 gallons of fuel a year, about 20% of our total consumption. At current prices that's about $375 annually, or a payback on my investment of 21 years at current energy prices (prices probably will go up, I know).

This might be why our plumber laughed at me when I told him I was thinking about installing a solar thermal system.

The numbers would change radically in a sunnier, warmer climate (more solar potential and cheaper, less complicated systems), or if the solar panels were replacing an inefficient boiler or water heater.

Location counts for a lot. In parts of the desert Southwest, for example, solar potential tops 7 kilowatt hours per square meter per day. In New England it's about 4 kWh per day, and solar systems must be much more complicated to prevent them from freezing in winter. So our experience is somewhat skewed toward a cold climate. In Florida or Arizona, it would be much cheaper.

Even so, conservation is something that works everywhere. It's an easily overlooked way of reducing carbon emissions from burning fossil fuels while avoiding nasty shocks to household finances as energy costs rise, two major objectives for investing in renewable energy. And conservation is a lot cheaper.

Low-flow shower heads, more efficient front-loading washing machines, intelligent plumbing design, high-efficiency boilers and hot water heaters, and hot-water circulation systems that eliminate the wait for hot water at the shower all are simpler approaches to reducing hot water conspumption and thereby the energy needed to make it.

Renewable energy is easier to do when the costs can be rolled into a mortgage and amortized over 15 or 30 years. It's also the right thing to do. But if it's not realistic, as was the case with us, there are other steps you can take that may prove just as satisfying.



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