Thursday, June 9, 2011

U.S. Residential Solar Water Heating Report

http://www.nrel.gov/analysis/news/2011/953.html
Executive Summary: This paper examines the break-even cost for residential rooftop solar water heating (SWH) technology, defined as the point where the cost of the energy saved with a SWH system equals the cost of a conventional heating fuel purchased from the grid (either electricity or natural gas). We examine the break-even cost for the largest 1,000 electric and natural gas utilities serving residential customers in the United States as of 2008. Currently, the break-even cost of SWH in the United States varies by more than a factor of five for both electricity and natural gas (from less than $2,250/system to over $10,000/system for electric and from less than $1,000/system to approximately $5,000/system for natural gas, 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). The break-even price for natural gas is lower than that for electricity due to a lower fuel cost. It was found that for a $7,000 SWH system capital cost (electric auxiliary heater), break-even conditions currently exist in 73 electric utility service territories (serving 16% of all residential customers). To see similar economics for SWH systems with natural gas backup, the SWH system capital cost would have to drop to $2,500. We also consider the relationship between SWH price and solar fraction (percent of daily energy requirements supplied by the SWH system) and examine the key drivers behind break-even costs. Overall, the key drivers of the break-even cost of SWH are a combination of fuel price, local incentives, and technical factors including the solar resource location, system size, and hot water draw.
The full report is available free of charge at http://www.nrel.gov/docs/fy11osti/48986.pdf

by Hannah Cassard, Paul Denholm, and Sean Ong
National Renewable Energies Laboratory www.NREL.gov
March 8, 2011

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