Technical and economic performance of residential solar water heating in the United States

This paper examines the regional, technical, and economic performance of residential rooftop solar water heating (SWH) technology in the U.S. It focuses on the application of SWH to consumers in the U.S. currently using electricity for water heating, which currently uses over 120 billion kWh per year. The variation in electrical energy savings due to water heating use, inlet water temperature and solar resource is estimated and applied to determine the regional “break-even” cost of SWH where the life-cycle cost of SWH is equal the life-cycle energy savings. For a typical residential consumer, a SWH system will reduce water heating energy demand by 50–85%, or a savings of 1600–2600 kWh per year. For the largest 1000 electric utilities serving residential customers in the United States as of 2008, this corresponds to an annual electric bill savings range of about $100 to over $300, reflecting the large range in residential electricity prices. This range in electricity prices, along with a variety of incentives programs corresponds to a break-even cost of SWH in the United States varying by more than a factor of five (from less than $2250/system to over $10,000/system excluding Hawaii and Alaska), despite a much smaller variation in the amount of energy saved by the systems (a factor of approximately one and a half). We also consider the relationships between collector area and technical performance, SWH price and solar fraction (percent of daily energy requirements supplied by the SWH system) and examine the key drivers behind break-even costs.