Go Solar! Solar Hot Water System

In my conversation with my engineer friend Steve, I learned that solar hot water systems are different from photovoltaic systems and that they are installed separately.  Solar hot water systems use solar energy to directly heat water.  Photovoltaic systems use solar energy to produce electricity.  Solar hot water systems are more like plumbing projects and photovoltaic systems are electrical projects.  If you think about it that way, it makes sense that installations of hot water systems  and photovoltaic systems are generally handled by different contractors, at least where I live.

I started compiling a list of possible contractors for each of the two projects by talking to friends who had solar water and/or PV systems to get their recommendations, and by doing a phone book and web search.  Once I had honed my list to four likely contractors for each project, I started making phone calls to request estimates.

The solar hot water installers were the quickest to respond.  In fact, most of them were willing to give a ballpark cost estimate over the phone, even prior to a home visit.  The basic question they asked in order to provide an estimate was "how many people are living in the home"?  I am assuming that they feel this is a pretty reliable indicator because the number of occupants correlates pretty accurately with the number of showers, loads of laundry, dishes washed and other household hot water requirements.  In fact, the most significant variable that seemed to be up for discussion was whether the water tank should be 80 gallons or 120 gallons. Without exception, the contractors recommended an 80 gallon tank for our 2-person household.

All of the general information I found available on the web stated that solar hot water made economic sense for pretty much everyone in Hawaii.  Right now, this seems especially true because there are tax credits available from the Federal and Hawaii Departments of Revenue, AND an additional $750 instant rebate through the Hawaii Energy Efficiency Program (HEEP).  HEEP has extensive installation requirements, but our solar water contractor was familiar with all of them and made the receipt of the instant credit absolutely seemless to us.  Here is a great link providing information on the $750 credit, the cost of an average solar hot water system in the state of Hawaii, and a pie chart on residential hot water use in Hawaii.  http://www.hawaiienergy.com/16/water-heating#solar-water-heating

I concluded that the decision about whether to install a solar hot water system or not was a no-brainer.  Why is that?  The systems are tried and true in Hawaii.  They are good for the planet.  Financially, they make great sense.  Here is the calculation showing the final net cost for our solar hot water system:

Based on the net cost above, I calculated an ultra-conservative estimate of the payback period for my solar hot water system.  Assuming that my current average daily hot water heating requirement is 6.8 kilowatt hours per day (30% of 22.8 kilowatt hours), that the solar hot water system will reduce that requirement by 80% (most sites say 90%!), and an average current cost per kilowatt hour of 40 cents (the cost on my last bill was 44 cents!), the pay-back period on my system will be about 26 months.  Using less, but still conservative, estimates for some of these values, I believe that it could take as few as 18 or 20 months for full pay-back.  One other factor that contributes to the financial wisdom of converting to solar water heating now is that we were very close to end of life on our existing water heater and would likely have had to replace it in the not too distant future.  So, the cost of the solar storage tank itself could feasibly be backed out as a "wash", making the pay back period even shorter.

Our contractor came highly recommended by former customers and fulfilled their promise of installing the system in a single day.  We have less than two weeks experience with the system, but we are very happy so far.  We have hit a rainy spell, so our savings in this early period may be lower than average.  But we have been able to test the full range of the system and are assured that the automatic timers that check the water temperature at proscribed times and allow the water in the tank to be heated conventionally if necessary works perfectly.

For people interested in the technical specifications of our system, here is the information on the system components:

1. 2 - 3' X 8' EP-24 solar collectors (SunEarth manufacturers)
2. 1 - 80 gallon solar storage tank with electric assist (Ruud manufacturers)
3. 1 - Auto-controller, differential thermostatic (Independent Energy-Goldline)
4. 1 - Solar re-circulation pump (Grundfos SU-15)