This recent project in Madbury, New Hampshire features both a flat plate solar hot water array, and 5kw of solar electric production

The dizzying drop in cost of photovoltaic (PV) panels is great news that’s making headlines, as well as shifting the way architects, green builders, and even solar installers think about venerable solar thermal technology.

With high-efficiency electric heating equipment available, and PV at record-low prices, doesn’t it make more sense to install an electric water heating system and then use PV to generate electricity to offset that electric load? Isn’t that “Solar hot water?”

Well… not so fast. While electric water heating backed up by PV works great for certain cases, the full story is a bit more nuanced. For homes occupied year-round with moderate (60GPD+) hot water consumption, solar thermal remains a clear winner for domestic hot water loads (the game is changing in solar space heating, but we’ll address that another time).

Solar Thermal: A Use it or Lose It Solution

For solar thermal to make sense you should occupy your home during the summertime, so as to take advantage of free hot water during peak production months. Unlike photovoltaic systems, which are able to bank excess summertime production for the winter by selling power to the grid, solar hot water systems are not good at providing storage for more than a few days at a time.

When properly sized, a solar hot water system will provide around 76% of year-round hot water consumption: 100% of the hot water a household consumes from May to September (and not too much excess), and ~50% of hot water use in the off-season.

Clearly, a home needs to be occupied in the summertime for solar thermal to make sense:

A Tale of Two Houses

For an active family, solar thermal is the least expensive way to meet year-round domestic hot water loads.

Solar thermal technology is much more efficient at converting sunshine to heat than photovoltaic panels are at converting sunshine to electricity (~60% vs. ~19%, respectively). This means that more hot water is available, at a lower cost, than a comparable electric-powered system. The differences are minor for a house with small hot water loads (<30gal/day) but as a household's hot water needs increase, solar thermal outpaces an all-electric system pretty quickly.

Let's compare the options for two houses. The former is a single person moving into a high-efficiency home. She uses a meager 20gal/day of hot water. Another is a family of 4 in a conventional home, which uses around 60gal/day.

Using a new, efficient electric tank, the single person will use around 1,600 kWh of electricity each year to heat water. To offset that with PV, she will need around a 1.3kw system. We will assume she has already maxed out state rebates on a previous PV system for "plug loads" (i.e. all of their other power needs) but still qualifies for the 30% federal tax credit. At a rate of $4.5/installed watt, the 1.3kw system + nice electric heater will come out to around $5,095. That's indeed less expensive than a solar thermal system, which will cost about $6,700 after state and federal rebates, and still require a bit (~$200) of electricity each year for water heating.

Things change quickly with a family that uses 3 times that amount of hot water (common, even conservative in many cases). In the 4 person household, we'll say the home uses 4,700 kWh/year for water heating. A 3.7kw PV is needed to offset the larger load. Again, assuming a federal credit but no state rebate, the PV system + nice water heater comes out to around $11,500. Now the solar hot water system, at $6,700 net, is the obvious choice (even if this home has not used up state PV rebates). Even adding a bit of PV to cover backup water heating (1kw will cover that $200/year nicely), the whole system comes out to around $9,200 total.

In short, the choice between one option or another depends a great deal on the behavior of a home's occupants and the size of a home. Seasoned solar designers will look at the overall picture of a home rather than assuming that "one size fits all."

Solar Hot Water Versus Heat Pump Water Heaters

Schematic of a Stiebel Eltron heat pump water heater

The introduction of heat pump water heaters makes the the solar hot water vs. electric water heating debate more complicated. For a cost of around $3,000 installed, these high-efficiency electric water heaters offer 2.5x more heating per kWh than conventional water heaters.

We recently calculated a demand of around 1289kWh/yr to run one of these units for a new construction project, or about the same annual production as installing 1kw of PV panels.

Based on an installed price of $4.5/watt for PV, this hypothetical hot water system results in an installed cost of around $7,500 prior to incentives, which are worth $1,950 (note that most PV systems are a minimum of 1.88kw so more likely the PV system would be sized a bit larger and meet some part of other household loads as well).

While the heat pump and PV solution hold a slight cost premium (around $1,150 less) than solar hot water in this case, it's not quite a clear case against solar hot water:

• If you are already investing in a PV project, adding solar thermal opens up additional state rebate money you would not other tap into. At $1,000 or $1,500 (ME and NH, respectively), the state rebates for solar hot water are more generous than for heat pump water heaters.
• Heat pumps are noisier typically than a solar hot water tank. This matters most in new, efficient buildings where mechanical rooms may be close to living quarters.
• Heat pumps achieve their higher efficiency by using ambient air temperature to heat water - in the wintertime this means using heated interior space for water heating, which adds to the overall heating load of the building, thus more energy is consumed to keep the building at a comfortable temperature.
• Warranties on heat pumps and solar hot water equipment are similar (10 years), though we feel that the long-term maintenance costs of solar hot water will be less than service costs of heat pump systems.
• Solar hot water collectors will take up less space to produce a household's hot water than a comparable PV array offsetting an electric device. This is important for households that want to make the deepest cut into their electric bill as possible and have limited south-facing roofspace.

Solar Thermal Stays Strong

The dramatically shifting landscape of solar electricity makes for exciting times. It's never been better to invest in a photovoltaic system, particularly while both Maine and New Hampshire have generous state rebates.

That being said, solar hot water systems still make great financial sense in many cases. Here's the takeaway:

Good Candidates for Solar Thermal Water Heating:

• Will replace an inefficient, high-mass boiler or older propane/electric tank for water heating
• Occupy the home year-round
• Use a fair amount of hot water
• Have adequate space to install a 80-100 gallon storage tank

Good Candidates for Solar Water Heating with Electric + PV:

• Vacation or seasonal homes
• Already have an efficient water heating system (on demand or efficient electric tank)
• Meager hot water needs
• Not a lot of space available for mechanical systems

A 4kw solar electric system recently installed in Portsmouth, NH with premium Sunpower solar electric modules.

This just in from the NH PUC – the residential solar electric (GTPV) rebate in New Hampshire has returned! The rebate, available for systems under 5kw in capacity, is $1.25 per watt up to a maximum of $4,500 or 50% of the system cost, whichever is less.

Of the $927,964 of funding, $500,000 is already committed to waitlisted projects, so if you want to take advantage of the credit, the time to act is now! Combined with unprecedented solar electric prices (in the $4.5/watt range), grid-tied photovoltaic (GTPV) systems are an incredible deal in New Hampshire.

Here is what a 3.6kw system, enough to make out the rebate, looks like:

$16,200 gross installed cost
-($4,860) 30% federal tax credit
-($4,500) state of NH rebate
$6,840 net investment

This system locks in your electric rate for 20 years at around .06c/kWh!!!  At today’s prices, the system will produce around $750/yr worth of electricity, for a payback of under 10 years.

As half of the funds are already committed, we urge you to act now if you want to take advantage of this generous state incentive.  Contact us to get started with a free evaluation.

Full details on the NH Solar rebate on PUC website: http://www.puc.nh.gov/Sustainable%20Energy/RenewableEnergyRebates.html

In today’s investment environment the choice seems mainly between the uncertainty of the stock market or the unimpressive returns of safer investments such as savings accounts, CDs, and annuities. We make an alternate suggestion: consider an investment in solar.

We had occasion to compare the relative returns of investing in an annuity product vs. a solar electric system. While the two don’t seem much alike on the surface, they both have in common a significant capital outlay in exchange for a monthly dividend.

An annuity works by offering you a monthly payment for a fixed period of time based on a pre-determined interest rate, about 3.8% right now. A solar electric system also requires an up-front investment (unless you opt for financing), and offers a monthly “payment,” so to speak, in the form of reduced utility bills for the life of the system.

Like an annuity, the benefits of a solar electric system are realized over time; for economic models we usually use 25 years, the warranteed life of the panels (though the system is expected to remain operational 40-50 years). However, solar has the benefit that the “dividend” – your utility bill savings – actually increases over time as electric prices rise, unlike an annuity payment which is fixed.

Consider a married couple who are both 60 and in reasonable health and live in Maine. With $15,000 they can:

• Install a 5kW PV system which will provide roughly a $85 monthly benefit each month, which increases as electricity prices rise.
• Buy a joint lifetime annuity which will pay the couple $75 a month, which stays the same forever, not rising with inflation.

Given the choice, a lower electric bill looks like a much better investment for the next 25 years!

The Case in New Hampshire

In NH, even without the $2,000 state rebate, a solar investment still beats the annuity. In this case it’s more fair to compare a $17,000 solar investment to a $17,000 annuity. At that rate, the annuity will earn $85/month, which is pretty close to the solar in year 1. However, over the 25 years the solar becomes more valuable as the cost of electricity increases (averaging 4% a year right now) whereas the annuity stays the same. And, of course, you’re generating clean electricity the whole time rather than investing in a financial instrument.

The solar earns more, helps the environment, and takes strain off the grid. Who can’t feel good about growing with that?

With utility electric rates set to rise again and costs of solar continuing to drop, it’s never been better to free yourself from the power company. To make this process easier, ReVision is now able to offer a 20 year solar loan with rates as low as 5.24% through SunPower.

Key features of the new program:

• Available for SunPower premium solar modules, which boast up to 50% more power per sq. ft. than standard efficiency panels
• Loan amounts from $15,000 – $50,000
• Reasonable credit criteria and quick approval
• No pre-payment penalties
• Option to lower monthly payment after receipt of state/federal rebates

A grid-tied solar electric system allows you to generate your own clean energy straight from your rooftop – eliminating power company profits and reducing the need to fire up conventional coal plants for electricity generation.

ReVision offers a free evaluation if you’re interested in learning about how solar electricity would work for your home – and if you’ve had a quote from us in the past, please take the time to contact us today to see how the costs for solar have declined in the meantime.

SunPower on Homes

Here are some photos of homes where we’ve installed SunPower modules:

SunPower panels are only available through their high-screened dealer network. ReVision is the only Premier SunPower Dealer in Maine and one of a very few in the Northeast. Contact us to learn more about SunPower’s solar loan program.

Cliff Babkirk’s 5.4kw grid tied solar electric array will nearly completely offset the electric load of his air source heat pump, his home’s primary source of heat

Energy conservation had been on Cliff Babkirk’s mind for years, but it reached a head in 2008 when he received an invoice from his heating oil company for $5,000 for a pre-paid contract. “I knew I had to do something different,” he says, “I wanted to get off oil for environmental reasons already but now I had economic reasons too.”

His search for an alternative heating system initially lead him to geothermal, though quotes of up to $50,000 for a retrofit installation made the project uneconomical. Instead, he learned of an similar, but significantly less costly solution – the Acadia air source heat pump.

Immense Savings with Electric Heat

Made by a Maine company, the Acadia offered many of the same benefits as a geothermal system, and integrated with most of Babkirk’s existing system – including his air handler and duct work. He had the unit installed before the 2008 heating season, and estimates it saved him $3,200 after the first year alone!

Of course, the drop in heating oil costs were offset, in part, by a rise in electricity costs to run the heat pump. Babkirk also had an energy audit done and learned that his basement and attic were two big culprits for energy loss. So, for his next step, he set about to better insulate the trouble spots in his house, and then to offset the electric load of his heat pump with solar electricity.

In 2009 he added 2″ of rigid foam insulation to his basement walls (,) added closed cell sprayed foam to his rim joists, and undertook some serious air sealing work. In 2010, he pulled out much of his home’s existing attic insulation and replaced it with super-dense R49 blow-in cellulose insulation. Finally, in 2011, he added grid-tied photovoltaic installed by ReVision Energy to offset his electric usage. His initial goal was to drop his load of 16,000 kWh a year to around 10,000 kWh a year – his electricity baseline prior to the installation of the air source heat pump.

Solar Exceeding Expectations

“Our goal was to be producing around 500 kWh/month with solar and so far the system has exceeded our expectations,” Babkirk says, “The best part is that the energy I’ve paid for today with my solar panels is never subject to a rate change. I’ve locked in the cost of a portion of my electricity for the next 20-25 years at a rate below current utility prices. In addition, through the benefits of net-metering, CMP gives me a credit on my bill for excess electricity produced by the array that I don’t use.”

Cliff is a big fan of data monitoring, and has been using The Energy Detective (TED) to monitor his household’s electric use since 2008. He was immensely satisfied to send us this photo of his household’s electric use soon after the PV system was installed:

More Solar Power on the Horizon

While he’s made great progress already, Cliff plans to take his 30% federal tax credit from his first PV array and use it to buy more panels. “My goal is to get to 50% of my energy use being offset by PV,” he says. He and his wife plan to stay in their current home – overlooking a pond in Sanford, Maine – well into retirement, and so the idea of getting control over their utility costs is immensely comforting.

“We like the idea of reliable systems and predictable costs,” he says, “Currently our oil boiler is nothing but a fancy hot water system and a backup source of heat when we lose power or should the Acadia system require maintenance… And once we can find an alternative backup heat source I like even better, we will finally have a fossil-free house.”

In the meantime, Cliff can expect to generate over 6,576 kilowatt hours of clean, renewable electricity annually, while offsetting roughly 8,812 lbs. of CO2 emissions that would be generated from coal, natural gas, or liquid fuel power plants.

A recently installed solar hot water system in Gardiner, Maine

Great news for Mainers ready to start kicking their oil habits – Biddeford Savings Bank is now offering a 7.99% APR loan program for financing solar energy projects and other efficiency upgrades.

With home heating oil averaging $3.67/gallon in Maine, financing a solar hot water system makes it possible for many homeowners to save more money in fuel costs than they spend on the loan note.

Why Financing Solar Hot Water Makes Fiscal Sense

More than 400,000 homes in Maine heat with oil, and many of these homes get their domestic hot water supply off of a high mass oil boiler. While this solution makes some sense in the wintertime, when the boiler is already running for space heat, in the summertime boiler efficiency is terrible – as low as 20% – leading to unnecessary waste from poor boiler efficiency and standby losses.

Solar hot water systems allow these homes to heat their water nearly entirely with solar energy from May through September (yes, even in Maine). With the boiler now largely dormant in these months, these homes will see a fuel oil savings of roughly 350 gallons of oil a year. That’s a savings of $1,284 a year and set to increase as oil prices continue climbing.

Now, with a solar hot water system averaging $12,500 gross, and around $7,750 after state and federal incentives, by paying cash the payback is less than 7 years. With financing that payback can be nearly instantaneous.

By putting down not quite half of the cost of the system, which is largely reimbursed by federal and state rebates, a homeowner can make a cash flow positive investment in solar hot water starting year one.

Financing Solar Hot Water Systems by the Numbers

Below posits a $6,500 loan with a $6,000 downpayment on a solar hot water system. The initial $6,000 outlay is largely reimbursed by state and federal incentives, and ultimately completely recovered by energy savings.

After the 10 year payback on the loan, you’ll experience many years of free hot water! Contact us with any questions about solar hot water system financials or for a complimentary site evaluation. You can call Biddeford Savings for loan details at: 207-284-5906.

Download program flyer

One of the most popular questions at ReVision Energy lately has been “What state rebates are available in New Hampshire?” And no wonder – the residential photovoltaic rebate has come and gone, the solar hot water rebate is on a sliding scale, and the commercial rebates require some modeling to calculate.

Here’s a short guide to the rebates currently available and how they affect the economics of a solar energy installation.

Residential Solar Hot Water

Late last year the New Hampshire Public Utilities Commission announced an expansion of the solar hot water rebate thanks to the receipt of some additional federal funds.

The rebate comes in two parts – a state portion of the rebate that ranges from $600-900 and a federal portion which was raised from $750 to $2,000. To be eligible for the full rebate, a solar hot water installation must be a retrofit on a primary residence. For new construction, only the state portion of the rebate is available – $600, $750, or $900.

The range is based on the performance of the system, as modeled in MMBTU / year. Here’s a chart expressing the varying levels of the rebate at different levels of performance:

For a typical residential project (2 flat plate collectors which produce ~18.25MMBTU/yr) installed at a cost of around $10,500, the incentives amount to $5,750, well over half the cost of the system.

In a typical home that heats water with oil, a solar hot water system will save around 300 gallons of oil a year. Assuming oil costs are around $3.28/gallon, that results in a simple payback of under 5 years!

What Happened to Residential Photovoltaic Rebates?

Due to overwhelming demand, the New Hampshire photovoltaic rebate program ran out of money last year. The program is funded through the Renewable Energy Fund (REF), a fund supported by compliance payments made by electrical service providers who cannot meet renewable portfolio standard (RPS) obligations through the purchase of reneable energy credits.

The amount of these compliance payments varies widely year-to-year, and the PUC cautions that “There is no guarantee that sufficient funds will be available [when the program is next funded] to fund even those applications presently in the queue.” The earliest that any funding might again be available is July 2011. See: http://www.puc.nh.gov/Sustainable%20Energy/RenewableEnergyRebates-SREG.html

The good news – even without a state rebate program photovoltaic is appealing to homeowners. The costs of solar electric equipment has dropped by 40% in the past few years, and the uncapped 30% federal tax credit remains in place through 2016.

Rebates Arrive for Business

The much anticipated commercial solar hot water and solar electric rebate has gotten off to a great start in New Hampshire – so far ReVision Energy has already commissioned a PV system for Black Dog Car Wash that qualified for the rebate. Several more commercial projects are in the queue.

New Hampshire’s program makes $1,000,000 available to solar thermal and solar electric projects for businesses, schools, municipalities, apartment buildings – basically any structure not eligible under the residential program.

The rebate structure is more straightforward than the residential program:

• Photovoltaic (Solar Electric): $1/Watt up to $50,000 (or 25% of the project cost, whatever is less)
• Solar Thermal rebate: $0.07 per kBTU/year up to $50,000 (or 25% of the project cost, whatever is less)

Like the residential solar hot water program, a RETScreen modeling analysis is used to calculate the kBTU/year performance of the solar hot water systems. Solar electric is fixed based on the nominal wattage.

Between the state rebate and current federal solar incentives, 2011 is an extremely appealing year to go solar if you’re a business.

Let’s take, for example, a medium scale solar thermal project for a business that uses a lot of hot water – a hotel or retirement home, perhaps – that is currently heating water with oil.

We’ll propose a system of 20 flat plate hot water collectors and several super-insulated tanks that will produce over 182,500,000 BTUs/year of clean thermal energy. We’ll imagine that the system will save 2,300 gallons of #2 oil per year, a result of both reduced oil use and greatly reducing standby losses of the oil boiler in the summertime.

Assuming this hot water system costs around $100,000 gross to install, the fuel savings alone will pay for the cost of the system within its first decade of operation.

However, now there is an exciting suite of rebates to apply:

$100,000 gross installed cost
($30,000) federal tax credit
($28,900) accelerated depreciation – avoided taxes over 5 years thanks to lowered net income, assumes 34% marginal tax bracket
($12,775) state rebate – $0.07/modeled kBtu/year
$28,325 net investment – less than a third of the total cost of the project!

Within this new context, that same solar hot water system will pay for itself within two years thanks to the fuel savings.

The wasteful boiler imagined in this formula is not unique – over 750,000 buildings in New Hampshire and Maine use oil for heating, and over $2 billion is shipped out of the local economy to pay for the millions of gallons of liquid fuels used annually. With cost projections for oil, propane, and electricity set to rise, and a strong suite of renewable energy rebates here today, the time has never been better to invest in solar.

Contact ReVision Energy for more information about both the commercial and residential solar rebates or visit our website to schedule a free site evaluation.

This rendering shows how the proposed Northern Pass tranmission line expansion project would affect the view of a stretch of Rte 125 that faces Clarksville, NH.

The road to a renewable grid is not always a pretty one. The northern pass transmission project, a brainchild of PSNH and HydroQuebec, is the latest example.

The current plan calls for building out a tall transmission line through New Hampshire’s north country, including 40 miles of wild, unspoiled terrain in Coös County, and roughly five miles in the White Mountain National Forest.  The idea is to transmit low-cost hydroelectric power to satisfy the growing requirement for renewable generation in southern New England.

Opposition to the project from residents and local businesses has been unequivocal. A blog titled Bury the Northern Pass contains interesting information about the claimed benefits and impacts of the project. The Town of Easton will be voting on full-on municipal opposition to the project in March.

Why are people opposed to the Northern Pass?

• There is not demonstrable need for the project in the state, since New Hampshire is already a net exporter of electricity.  Benefits of this project would mostly go to residents of Massachusetts, Connecticut, etc. who’d see their peak grid supply increase, and to the energy provider (i.e. Hydro Quebec), who would gain access to the market through a widened conduit.
• The regional economies of Grafton and Coös Counties largely rely on the wild natural character of the land, for example tourism, hospitality, and other outdoor pursuits.   Part of this character would be lost with the construction of 100-foot tall transmission towers over the 180-mile route.
• There are alternatives to the project.  Distributed generation such as solar photovoltaic arrays represent a more rational and gradual way to build out grid capacity, and directly benefit the localities where it is installed by locking in electricity rates though decades of future production.  Although we agree that renewable resources should play a fatter role in the Northeast’s power supply, running Big Wires though pristine mountain passes in the north woods is not a good “plan A.”

A recent letter to the Union Leader provides a good summary of the arguments against the Northern Pass, and notes the amount and intensity of local opposition.  There was also a vigorous public debate about RPS, which dovetailed into a debate about Northern Pass, two weeks back.

As promoters of smart solutions to our energy problems, and lovers of the rugged outdoors which gives New England its character, we hope to see alternatives to the Northern Pass gain steam and a healthy debate in Concord follow.