Why rent your power when you own your home?
100% Solar Electricity (PV) is now a better value than Solar Hot Water and Solar Electricity combined.
Implementing solar power is one of the biggest decisions homeowners face regarding their property. With the increasing efficiency and lifespan of photovoltaics (PV), as well as increased production and incentives reducing their cost, it’s time to compare and reevaluate the value of solar water heaters and photovoltaics.
The primary considerations for each system are the cost to homeowners and its integration with their lifestyle. Solar water heaters are often regarded as the economical choice, but a closer look at the short- and long-term costs and the system’s efficacy in driving down utility expenses reveals a different story altogether.
Now, for the first time, cost, efficiency, investment incentives, and the net-metering system have made photovoltaics the less expensive option, offering customers a low-maintenance solar power option with immediately reduced utility bills and pronounced savings in the long term.
Near-parity in the short term
A Hawaiian Electric Co. (HECO) study found offsets from solar water heaters to be 1.8 kilowatt-hours per person per day, or 5.4 kWh for a family of three, and the upfront cost of a Solar Hot Water system to achieve that offset is $6,000-$7,000. With tax incentives and HECO credits, the cost is reduced to $2,000-$3,000. But the system will only heat water.
For $5,000-$6,000 before incentives, homeowners can get six (6) photovoltaic panels able to produce the same 5.4 kWh. And with tax credits, the cost of eight (8) panels is reduced from $15,000 total to $5,000 net. For approximately $2,000 more in after-credit cost, homeowners can invest in a PV system to provide ample, flexible power for whole-house electrical needs, water heating included.
Once a solar energy system is functioning, solar water heaters will only heat water. With PV systems, the solar-generated electricity heats water and fills all other electrical needs. When solar panels generate more energy than the household uses, excess energy is ‘deposited’ in to the power grid and banked as energy credits. At night, these credits are ‘withdrawn’ and any surplus energy is ‘rolled over’ into the utility account at no cost. If in a month more electricity is deposited than used the electric company issues a credit; a debit if more is used than deposited. Though solar hot water systems may offer significant savings, they simply cannot offer the broad reaching offsets nor match the years of maintenance free service PV systems offer.
Comparison of Daily Household Energy Production and Usage
Traditional Grid Power
MORNING—Hot water supply is depleted with morning showers, food prep and cleaning. Electricity usage increases with lights, televisions, computers and air conditioners.
DAY—Grid electricity is drawn to replenish hot water supply and power air conditioning and other household appliances.
EVENING—Hot water supply is again depleted with food prep, dish washing, laundry, and baths. Televisions, computers, microwaves, and household lighting all draw power from grid electricity.
NIGHT—Grid electricity re-heats hot water in an electric hot water heater.
Grid Power + Solar Hot Water
MORNING—Hot water supply is depleted with morning showers, food prep and cleaning. Electricity usage increases with lights, televisions, computers and air conditioners.
DAY—Energy from the sun is used to replenish hot water supply. Air conditioning and other household appliances continue to draw grid electricity.
EVENING—Hot water supply is again depleted with food prep, dish washing, laundry, and baths. Televisions, computers, microwaves, and household lighting all draw power from grid electricity.
NIGHT—Grid-powered electric heater for solar hot water tank is used when hot water demand exceeds solar-heated supply.
SYSTEM BENEFIT—Over the course of a typical day, 20-30% less grid power is used than the traditional power arrangement, but there is still a net draw and utility bill.
Grid Power + Solar Electric (PV)
MORNING—Hot water supply is depleted with morning showers, food prep and cleaning. Electricity usage increases with lights, televisions, computers and air conditioners.
DAY—Energy from the sun is absorbed by the PV system, which heats household water and generates electricity used by air conditioning and other appliances.
EVENING—Hot water supply is again depleted with food prep, dish washing, laundry, and baths. Televisions, computers, microwaves, and household lighting can draw power from grid electricity for free with banked energy credits.
NIGHT—PV-powered homes can draw from energy credits banked during the day and utilize free, clean solar energy even at night.
SYSTEM BENEFIT—Depending on system size and weather conditions, electricity production can outpace demand. Solar-generated electricity replenishes hot water supply, satisfies daytime energy demands, AND, if surplus energy is produced, the excess electricity is banked as energy credits with the utility.
Comparison of Daily Household Energy Production and Usage
Traditional Grid Power
Under a traditional utility arrangement, a household draws all electricity from the power grid and utilizes no alternative energy technologies.
Grid Power + Solar Hot Water
With a solar hot water system, solar energy is absorbed during daytime hours (4-6 hours per day in optimal Hawaiian sun zones). 100% of this solar energy is used to heat hot water. Because most houses are empty during the peak sun hours of the day, much of the solar energy absorbed by hot water systems is actually lost by heating and re-heating unused water.
Grid Power + Solar Electric (PV)
As is the case for homes with traditional grid power and solar hot water systems, hot water supply is depleted and electricity usage rises throughout the morning, until families leave the home for the day.
During the day, energy from the sun is absorbed; but instead of just heating and re-heating hot water, a PV system converts solar energy to household electricity. Depending on system size and weather conditions, electricity production can outpace demand. As such, solar-generated electricity replenishes hot water supply, satisfies daytime energy demands, AND when surplus energy is produced, the excess electricity is banked as energy credits with the utility.
In the evening, hot water supply is depleted and electricity needs increase with use of televisions, computers, microwaves, and household lighting. Instead of simply buying electricity from the utility to power these appliances and re-heat water, PV-powered homes can draw on energy credits banked during the day. Doing so, these homes utilize 100% of the solar energy absorbed, even during hours when the home is empty.
Value of long-term reliability
After comparing the near-parity of upfront solar hot water and PV costs and the monthly savings from net metering, it’s important to examine the long-term expenses and ROI of both options. Solar water tanks are warranted for six years. Due to corrosion from thermocycling of the steel tank and copper pipes, hot water tank replacement is often needed within 10-12 years. And complete solar water heating systems will need to be replaced within 12-15 years. In comparison, photovoltaics provide a 25-year power production warranty and last 30-40 years, needing only a possible inverter replacement at 15 years. A new inverter costs less than 10 percent of the entire system, compared to 100 percent for solar water heater replacement.
Maintenance expenses associated with photovoltaics are significantly lower. PV systems require only an annual cleaning with soap and a soft brush, while solar water tanks require annual flushing and cleaning, with a sacrificial anode rod replacement every five years. The costs associated with service-intensive solar water heaters are ultimately passed to the solar customer.
Initial & Ongoing Expense Over 30 Years
In the second 15 years of homeownership the cost of the solar water heater has doubled, and could be even greater depending on the credits and incentives that may not be available in the future. The only expense of the photovoltaic system in the second 15 years is annual panel cleaning upkeep.
Total Costs Over 30 Years
Flexibility for any lifestyle
While the short- and long-term costs of a solar energy system are easily quantifiable, homeowners must also decide if a solar water heater fits their lifestyle. During winter in Hawaii, or in certain cloudy microclimates, homes outfitted with solar water heaters frequently rely on the grid for supplemental electric heating. Many modern photovoltaic panels are so advanced that power continues to generate even during inclement weather.
Solar water heaters also require modifications to move water to and from the roof, risking leaks and numerous holes in a home’s structure. And the heated water has to be pumped — using traditional electricity sources — through the system continuously to prevent failure. Unused hot water constantly moving through the system raises the rate of tank corrosion, and scaling in copper pipes increases exponentially.
With a photovoltaic system, water is always hot. Even if no one is home to use it, the hot water is held at temperature as it would be with an electric hot water heater connected to traditional power sources. The energy generated from the PV system isn’t continuously heating and reheating the same water. The water temperature remains constant while solar energy is continuously harnessed to power other electricity needs, and excess energy is rolled back into the grid for banked credits.
What is “average?”
Perhaps the most compelling argument for photovoltaics comes from the HECO study1 itself. The study’s base of 1.8 kWh per person per day2 is a conservative estimate. Factoring in hot water for laundry or several baths per week pushes energy needs closer to 2.5-3.0 kWh per person per day. This in turn drives costs up throughout the equation for solar water heaters.
PV now for the future
How best to harness solar energy in Hawaii residences is becoming a measurably simpler decision. With credits and incentives, photovoltaics are as affordable as solar water heaters, and in the long term they are even more cost-effective. PV is the only solar option that gives homeowners not just affordable, reliable hot water but also the power needed for household electrical needs. And as the PV system works to power the home, any excess energy is routed back to the grid and banked for credit with the utility.
While a solar water heater is still is a step in the right direction toward sustainability and energy independence, the analysis here clearly demonstrates the superior performance of photovoltaics in both financial and environmental terms. Homeowners appreciate money saved today and in the future, while generations to come enjoy a brighter Hawaii and a utilities infrastructure based on sustainability.
- “Energy and Peak Demand Impact Evaluation Report of the 2005–2007 Demand Side Management Programs” for Hawaiian Electric Company, 2008
- $15/person x 1 month (30.5 days) x 1kwh / $.028 = 1.77 kwh/day (per person)
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