Updated 3 weeks ago

Solar water heaters: Are they worth the cost?

Written by Andy Sendy

If you’re looking to reduce your electricity bills, a popular method to do so is installing a solar water heater. These systems can provide your home with hot water by utilizing a renewable resource instead of the electric grid.

We’ll give you the rundown on solar water heaters; how they work, popular brands, and most importantly – how much money you can save by installing one!

Find out how much money you can save with solar

What is a solar water heater?

Unlike traditional water heaters, solar water heaters don’t use energy from the grid to heat water. Instead, these high-efficiency appliances use dedicated solar collectors on your rooftop to draw power from the sun. The solar energy collected is then used to heat the water in your home. 

Solar water heaters have been extremely popular in the past because they cut down your electric bill and allow you to heat up your water with clean energy. The solar collectors directly heat your water and do not provide any other solar energy to your home.

More recently, people have been opting for electric heat pump water heaters, which are coupled with home solar panel systems. Electric heat pumps use grid energy to heat your water, however, when paired with a home solar system, they are able to still run on solar electricity. 

If you aren’t able to install a full home solar system, or if you have an off-grid home, a standalone solar water heater can be a great option.

How do solar water heaters work?

Solar water heating systems can produce enough hot water to fulfill most of your daily domestic hot water needs. 

There are two main types of solar water heaters available for residential and commercial use: 

  1. Active solar water heaters

  2. Passive solar water heaters

Each of these works differently and consists of different equipment. 

Active solar water heaters 

Active solar water heaters use a pump to circulate hot water from the solar collectors, or absorbers, to your home. These are usually installed in areas with colder climates, as the water gets stored in a tank that can be kept indoors to prevent freezing. 

There are two different types of active solar water heaters:

  • Active direct systems, where the water is heated directly in collectors and is then sent to your faucet and showerheads. The solar collectors are usually metal or glass tubes.

  • Active indirect systems, in which a heat transfer fluid, like propylene glycol, is heated up within the solar collectors, and then transfers the heat to the water supply with a heat exchanger in a closed-loop system. Some heat loss occurs while the transfer fluid circulates the system. 

Passive solar water heaters 

Passive solar water heaters do not use circulating pumps to move hot water. Instead, they rely on convection as the circulation system, where hotter water rises to the surface and cold water sinks, in order to circulate water. 

Passive solar water systems are usually cheaper than active ones, as they don’t require special equipment to pump the water. 

There are two main types of passive solar water heaters:

  • Integral collector solar water heaters are large, black water storage tanks that are built into an isolated box with a top that lets sunlight through. The sunlight heats the water directly in the black tanks, which then flows into your plumbing system when you need hot water.

  • Passive thermosyphon systems use metal flat plate collectors to heat small batches of water on your roof. When you open your hot water valves, hot water in the top of the batch collector flows down from your roof to your faucets. These usually are designed to contain 40 gallons of water. 

Many passive systems include a tankless heater as a backup energy source, which can either be gas or electric.

What are the most popular brands of solar water heaters?

As solar technology continues to find new applications in our daily lives, more companies are manufacturing solar heaters. These are some of the most popular models on the market today.

  • Duda Diesel manufactures machinery that uses biodiesel and other alternative fuels. They offer a range of solar water heaters for residential and commercial use.

  • Sunbank Solar produces collectors, pumps, plates, and other components for solar water heating systems.

  • SunEarth offers a range of solar energy solutions for homes and businesses, including solar water heating systems and elements.

  • Apricus and Rheem are two of the more popular solar water heaters.

How much you spend on a solar hot water heater depends on what kind of system and what size system you get. 

Smaller passive solar water heater systems could cost around $3,000, while a larger active system could run you more than $10,000. 

How to select the right solar water heater

Each type of solar water heating system works best in different environments.

  • Direct systems work best in areas that don’t often see temperatures below freezing. In cold climates, indirect active systems are more resistant to freezing damage.

  • Want your solar heating system to do double duty? Invest in an indirect circulating system. The heating fluid can be redirected to heat your swimming pool or spa in between working to supply your home with heated water.

  • Families that use more warm water during daylight hours benefit from integral passive systems. By producing multiple small batches of warmed water, family members won’t have to worry about having enough hot water for morning showers.

  • Have more roof than ground space? A thermosyphon solar water heater fits on your roof, which leaves you more space in your living area.

  • Integral collector storage systems can weigh over 400 pounds, so you have to make sure your roof can support the weight of a heavy water tank.  

You also have to consider how much sunlight your property receives, how much hot water you use on a daily basis, and your budget. 

When shopping for solar water heater options, look for ratings from the Solar Rating and Certification Corporation (SRCC). SRCC ratings allow you to easily compare different brands and models using expert third-party data. 

Every property is unique, so you should also seek expert guidance to ensure you choose the perfect system for your home. Talk to an installer in your area to learn more about suggested equipment for your project.

Find the best solar installers in your area

How much money can you save with a solar water heater?

Solar water heaters require a hefty upfront investment - in some cases around $5,000. 

However,  after installation, a solar hot water system will slowly start to pay back its value in the form of lower utility bills. In fact, solar hot water heaters can usually cut your water heating expenses by anywhere from 50% to 80%! 

Once you reach the end of your solar payback period, your solar water heater will be producing nearly free hot water for the remaining lifetime of the system! Plus, because solar water heaters don’t have moving parts, they have relatively low maintenance costs. 

Keep in mind, depending on how much hot water you use, you might have to rely on a backup grid-tied hot water system. 

To calculate your potential savings, you’ll need to know:

  • How much hot water your family needs on a daily basis.

  • The cost of fueling your backup heater. Contact your local utility company for more information on energy costs for backup heaters.

  • The SRRC or solar energy factor rating for your intended equipment. These numbers give you an idea of how efficiently your appliance will use gathered solar power.

  • How much of your hot water use occurs during daylight hours. Using more hot water when there’s less sun available means more reliance on pricey grid energy.

  • The life expectancy of your solar water heating system. The longer your heating system components last, the more money you’ll save.

With this information, you can determine the annual operating cost of your solar water heater. Compare this to your regular monthly utility spending to see how much energy savings you could get by switching to solar.

What rebates and incentives are available for solar water heaters?

The Clean Energy Tax Credit, also known as the federal solar tax credit, offers a credit equal to 30% of the costs of installing a solar water heater. So, let’s say your solar water heater costs $5,000. You’ll receive a tax credit of $1,300, bringing the total cost of your system down to just $3,500. 

Your local utility company may offer special discounts or rebates for the installation of qualified equipment, as well. For example, Hawaii Energy offers rebates of $750 to customers who install a solar water heater. 

Find a solar water heater installer in your area to lower your utility costs without sacrificing comfort.

Should I get a solar water heater or a home solar panel system?

Solar water heaters were a popular option until a few years ago. The current trend is for homeowners to just get a solar panel system installed instead.

Why? Because the cost of solar panels has fallen so much in recent years. The most cost-effective option is to pair a residential solar panel system with an electric water heater. The solar panel system will not only cover your hot water costs but the energy costs of your whole home. Plus, electric water heaters are more efficient than even the highest quality solar water heaters.

Of course, solar water heaters can be worthwhile in some cases. They are more effective than solar panels at their specific function - heating water. The sunlight only has to heat the water, not get turned into electricity that then powers a system to heat the water. 

Solar water heaters also require much less roof space than a full solar system. If you have major space constraints, solar hot water heaters could be the best way for you to take advantage of solar energy. 

Local solar companies will have the ability to install both solar panel systems and solar water heaters. They’ll also be able to determine what would be best for you - getting just one or both. For more information, including how much a solar energy system would cost for your home, contact a vetted local solar energy installer in your area.

Find out what a solar installation would cost based on recent installations in your zip code
Written by Andy Sendy Solar Industry Expert

Andy Sendy is a well-known and trusted figure within the solar industry with more than 15 years of experience. His video reviews of the leading brands of solar panels and home energy storage batteries are a must-watch each year for both homeowners and solar industry professionals alike. In 2021, an article he wrote about a clause in the Tesla solar panel rental contract caused Tesla to change this clause within days. He was the founder of Sola...

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