The effect of payback time on solar hot water systems diffusion: the case of Greece

The effect of the payback time on the spectacular diffusion of solar hot water systems (SHWS) in Greece was investigated in this work. The time pattern of the diffusion of flat plate solar collectors since its first appearance in 1974 shows that the diffusion rate grew exponentially at first, with the annual sales figure reaching 185,000 m2 in the mid-80s. A rapid decline of the growth rate, down to the present annual sales level followed. By the year 2000, more than 2,000,000 m2 of collectors had been installed. The economic behaviour of the main type of users (households and hotels) was found to have undergone two stages: in one of them, 1978-2002, the change of sales is in agreement with a change in economic feasibility, measured by payback time, while in the other, the early growth stage, 1974-1977, the demand grew despite a negative economic trend, obviously because of non-economic factors. The role of tax deduction, which is the most influential incentive, has been rather instrumental in the growth period 1978-1989, but lost its significance thereafter. This incentive has been withdrawn since the beginning of 1993.