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Solar Water Heaters: Switch to This Alternative to Save Energy (and Money)

A solar water heater might save you some money with greener heat, letting you shower with the power of the sun.

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A solar water heater sits on a rooftop in Brazil.
Lucas Ninno/Getty Images

Rising prices and what often feels like an energy crisis might mean you're paying more attention to how your home uses energy. If you want to save some money on your bills, start with your water heater. That unassuming boiler in your basement can use 14% to 18% or your home's monthly energy budget, according to the Department of Energy.

While simply turning down your water heater's temperature is a great place to start, in some cases using a different fuel source altogether can make an even larger difference. Case in point: Solar water heaters use the sun's warmth to heat water. While widely adopted in parts of the world, they aren't terribly popular in the US at this point. 

Given their cost, and the (until recently) dropping price of solar panels, solar water heaters may not make sense for many homeowners. But in certain cases they can still reduce your carbon footprint and save you a bit of money.

Below is everything you need to know before you stick one on your roof, including whether you should at all. You can also learn about whether unplugging your appliances really saves you money, and 28 ways to cut your home costs right now

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What are solar water heaters?

Solar water heaters vary in design, efficiency, capacity and price, but they all replace a good chunk of the gas or electricity used to heat water with clean, free sunlight. The three basic designs all have a way to collect heat, a tank to store hot water, back up heating for when your system can't keep up and some sort of circulation system.

Batch collector water heaters heat up water in tubs or pipes, usually painted black to collect more of the sun's heat. To keep water from getting too hot, cold water can be mixed in periodically. These heaters are best suited for warmer climates. Where freezing might be an issue, they'll need to be drained during cold months to avoid damage to the system.

Flat-plate collectors rely on a metal plate, often painted black, to soak up the sun's heat. Heat travels from the plate to water-filled tubes. The water cycles through heating tubes to and from the storage tank, keeping the stored water hot.

Evacuated tube collectors are the most efficient models out there. Water is heated in a tube that's surrounded by a larger, vacuum-sealed glass tube. Because there's no air between the heating liquid and the outside world, very little heat is lost.

Solar water heaters can heat water directly or indirectly. In indirect heaters, the sun heats a heat transfer liquid (often a water and propylene glycol mixture), which then transfers its heat to water in a tank. Because the freezing point of the heat transfer liquid is lower than water, it can operate in colder climates. Evacuated tube collectors can work in temperatures as low as -40 degrees Fahrenheit, according to the US Environmental Protection Agency.

Water needs to be cycled through the system so that warmed water can be stored and new water can be heated. This happens in one of two ways. Passive systems rely on hot water rising and cold water sinking. The natural movement of the water cycles water through the system. Or, systems can cycle water actively, using a pump. This is the most common type of system in the US, according to the EPA.

Buying a solar water heater

Before you buy a solar water heater, there's a bit of research to do.

First, your roof (the most common place for solar water heaters) needs to be in good shape and get enough sun. If you need to replace your roof, do that first. Depending on the system you can get by with more or less sun, but one recommended metric is at least six hours of sunlight on clear days, all year long. A roof facing directly south (in the northern hemisphere) is best, but water heaters can be shifted 45 degrees F in either direction and still perform well enough.

Second, like any major purchase, you should get multiple quotes. Installers with local knowledge may be able to give you a better idea of how your water heater will perform in your area's climate.

Precisely sizing your water heater takes a bit of complicated math, but we can rely on a few rules of thumb. To supply hot water for two people, a solar water heater should have a collector plate of 20 square feet. For each additional person, the collector should be 8 square feet larger if you live in sunnier areas, like the American south, and 12 to 14 square feet larger if you live in the north. Water tanks should be 1.5 gallons per square foot of collector plate, or up to 2 gallons per square foot for sunnier climes.

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Solar water heater on a roof in Spain.

Jose A. Bernat Bacete/Getty Images

Two other metrics you'll want to check are the solar energy factor and solar fraction. A system's solar energy factor is the amount of energy provided by the solar portion of the system divided by the amount of energy provided by gas or electricity. The scale runs from one to eleven; the Department of Energy says two or three is typical. The solar fraction is the energy provided by the sun divided by the total energy used by the system (including what's wasted along the way). A typical solar fraction falls between 0.5 and 0.75 and changes based on an area's climate. All EnergyStar certified solar water heaters provide these numbers and are helpfully compared by EnergyStar.

Hypothetically, a family of four living in the northern part of America would need a collector plate at least 44 square feet and a 66 gallon storage tank. One supplier, Duda Diesel, offers a system with an 80 gallon tank for $3,499. This one supplier offers systems from 26 gallons ($2,175) all the way up to 264 gallons ($11,477). 

In the United States, solar water heaters do qualify for the federal tax credit, which currently sits at 26%, though it's slated to fall to 22% in 2023. For a system that costs $3,877, you would be eligible to receive back $1,008 when you file your taxes.

There may also be some maintenance costs, especially if you have hard water that leaves deposits behind. These can decrease your system's efficiency and require temporary descaling. Maintenance costs are typically minimal.

Is a solar water heater a good deal?

Solar water heaters are significantly more expensive than conventional water heaters. You'll likely spend thousands of dollars or more to install one and it will take at least a few years to save more money than you spent.

How quickly a solar water heater will pay back its cost in energy savings depends on the local cost of energy, whether you heat water with gas or electricity and even when you use hot water. (Shifting showers, dish washing or laundry to the evening, when there's plenty of solar heated water on tap will require less backup energy than doing those things earlier in the day.) You can find detailed instructions for calculating your payback period, but solar water heaters take longer to pay for themselves if they replace natural gas water heaters than if they replace electric ones. If your hot water costs are high, you could recoup your expenses in a matter of years, much faster than the 20 or more years a solar water heater can operate.

A more cost effective way to go solar could be to run an electric water heater with electricity-generating solar panels on your roof. Solar panels are getting cheaper and they can replace the power needed not only for heating water, but for any of your other home electricity needs. A rooftop solar array can be sized to include the needs of an electric water heater and, depending on the efficiency of the water heater, may require only a slightly larger solar array. And, your utility might pay you for any excess electricity you generate from solar panels. Any excess energy a solar water heater creates won't be compensated.

While solar water heaters are cheaper than photovoltaic solar panels, the latter will likely save more money over the long run and set off more of your energy needs. While local prices, your energy usage and climate will always impact this math, solar water heaters will likely save you money and keep some carbon emissions out of the atmosphere. Solar panels may outperform solar water heaters on both accounts.