Sunny Side UP
by Steve Smith
May 2, 2008
Rising
energy costs? Tax incentives to install solar heating systems? Haven’t we been
here before? Yes and no.
Solar
is making a comeback for the first time since the late-1970s. To a certain
extent, it sounds like the past repeating itself, with energy prices up and tax
incentives to install solar heating systems. Some things, however, may have
changed to help alternative sources of energy move at least a bit more to the center
of the stage.
So what’s happening now that’s causing a rebirth of solar energy? Here’s a
number of questions we had and the answers we found.
I’ve heard plenty of stories about solar hot water systems put in during the Carter administration. What I’ve heard doesn’t exactly fill me with confidence.We’ve
heard those stories, too, when fly-by-night companies were busy selling tax
credits instead of installing quality equipment. But a couple of things are
different today.
Like what?
A big difference comes by way of the Solar Rating and Certification Corp. The
nonprofit group provides third-party testing, rating and certification of solar
collectors and solar domestic water-heating systems.
The group developed two standards for testing and rating solar
products:
- Standard OG-100 requires that collectors undergo
testing for both thermal performance and durability. Collectors are tested for
thermal output under a range of solar intensity and ambient temperature
conditions. The standard also requires testing for withstanding stagnation,
severe weather and thermal shock.
- Standard OG-300
combines the physical testing of collectors with a quality-assurance review of
all major components in a solar water heating system. The standard also
provides simulated performance estimates for the system in specific geographic
locations.
In many cases, meeting these standards serves as the basis for qualifying
installations for federal and state tax credits, as well as for other
organizations offering financial incentives for solar
installations.
You can find out more by going to www.solar-rating.org.
There’s also a movement to certify installers of solar thermal systems. The North
American Board of Certified Energy Practitioners held its first certification
exam last year. You can find out more by going to
www.nabcep.org.
Finally, keep in mind that while the solar market collapsed in the United
States, other countries still had to contend with high energy prices. As a
result, progress in product improvements didn’t collapse.
Regardless of certification, much of the installation work for solar hot water
systems has been streamlined, thanks in part to preassembled packages.
But
those tax credits you mention are going to end this year,
right?
The federal tax credits are scheduled to end on Dec. 31, but solar trade groups
are lobbying hard to have those credits extended. However, there are plenty of
other tax incentives and financial programs throughout the country run by
states or municipalities.
How can I find out about them?
Several contractors we talked to told us about the Database of State Incentives
for Renewables & Efficiency ( www.dsireusa.org).
It would take a full-time job to keep up with all of the programs we found on
this site. Luckily, that’s what the DSIRE does, tracking information on state,
utility, local and selected federal incentives that promote the use of
renewable energy technologies. The database was established in 1995 as a
project of the North Carolina Solar Center and the Interstate Renewable Energy
Council.
Out of curiosity, we clicked on our home state of Illinois and found information
on almost 30 programs. While it’s much more than just solar hot water, you may
be surprised at the various energy and energy-efficiency incentives out
there.
The list of state incentives contains handy links to individual program
summaries containing the following details: incentive type; implementing
sector; eligible sector; eligible technologies; links to authorizing statutes,
regulations or policies; program summary; links to incentive program Web site;
and contact information.
Tax
incentives are nice, but what will happen if energy prices drop like they’ve
done before?
I have a distinct memory of a big debate that took place in my high school
sophomore social studies class during the mid-1970s: What would happen if gas
ever went past a $1 a gallon?
A lot of people were glad to hear about energy alternatives at the time. But by
the mid-1980s, energy prices dropped and alternatives faded, too. Now with
regular unleaded gas heading to $4 a gallon, everyone wants to know about
alternatives again. But what if energy prices dropped?
Regardless of what happens to oil prices, other factors will continue to push
even the biggest oil addict to make greater use of the sun, wind, geothermal
and other alternatives, according to a report released last February by the
Cambridge Energy Research Associates.
“Climate change and putting a price on carbon will change the dynamics of the
energy marketplace,” the group’s chairman, Daniel Yergin,
told the New York Times. He also said the ravenous demands
of oil from China and India were not a factor in global energy markets at all
during the first price shocks following the Arab oil embargo of the 1970s. “You
need renewables as part of the solution to meet this astonishing demand,” he
added.
(Incidentally, if you ever want to know about how we came to be addicted to
oil, pick up Yergin’s book, “The Prize: The Epic Quest for Oil, Money &
Power.”)
So
there’s more interest in green these days.
Absolutely. Whatever we’re spending on energy five years from now, plenty of
“green” consumers will be motivated to offset their carbon footprint. Sure,
they’ll want to save on their heating bills, too, but if they can cut
greenhouse gas emissions in their own personal way, that’s all the
better.
According to the EPA, a single 80-gallon solar hot water system installed in
sunny New Mexico annually offsets more than 9,000 pounds of carbon dioxide
emissions — that’s roughly equal to driving a car 11,000 miles. Another report
we read for the city of Durham, N.C., said switching from an electric hot water
heater to solar would reduce a family of four’s greenhouse gas emissions by
more than three tons annually. We didn’t major in math, but they do back up the
numbers with some heavy-duty ciphering in the appendix.
Suffice it to say that, thanks to all the news about green construction, many
people might look past higher first-time costs to save the
environment.
All I ever read about is solar PV for electricity. But I’m a plumbing
and heating installer. What’s going on with the solar thermal
market?
As we prepared for this new supplement, we couldn’t help but think that solar
thermal must be the alternative energy’s red-headed stepchild. Many of the
articles we read in the mainstream press barely talked about using the sun to
heat water. Everything was on solar photovoltaic initiatives, such as
California’s Million Solar Roofs program.
But for all the hype on solar electricity, consider that the Department of
Energy says that solar electricity amounted to less than 0.01 percent last year
of the national electrical use and, at best, will account for just 2-3 percent
of the total in the next 25 years.
But using the sun to heat water has significant advantages over using the sun
to generate electricity.
How
so?
From a cost perspective, solar panels that convert sunlight to electricity are
really going to give consumers sticker shock. More importantly, what consumers
get in return on solar PV pales in comparison to what they can get for
investing in solar hot water systems.
Sounds good. Keep going.
Solar PV panels start right out of the box with two strikes against them.
First, they’re more expensive to produce since they use semiconductors to
convert sunlight into electricity. We’re oversimplifying, but think of them as
computer chips — only so big you need a truck to bring it
home.
Second, PV panels are much less efficient at turning the sun’s energy into
electricity than solar thermal panels to capture the sun’s energy to heat
water.
We read an interesting first-person account of one man’s attempt at solar PV
for his home at the behest of one of the most committed green consumers out
there: his 10-year-old daughter.
The homeowner was paying about $900 a year for electricity, or 10.8 cents per
kilowatt, per the local utility’s rate. Long story short, the homeowner
determined the final bill to install solar PV would be $48,000 for the solar
panels alone and $65,000 for the completed job.
He figured he’d qualify for about $14,000 in federal and local incentives.
Borrowing the balance would mean repayments of roughly $600 a month for 10
years. Bottom line: he’d ultimately save about $75 on electricity a month. Keep
in mind, he enjoyed 300 sunny days a year in southern
California.
I hope solar hot water offers a better
deal.
Anyone who’s left a garden hose in the sun on a summer day knows how hot the
water left over in that hose can get. While there’s certainly a bit of
technological wizardry involved in solar hot water systems, it’s much more of a
straight shot to make use of sunshine than a PV panel.
The efficiency of solar heating collectors is typically at least five times
that of PV modules. In other words, you can get five times more useful energy
from each measure of sunlight that strikes its surface.
Heating and hot water also amount to a much greater use of energy for
the typical homeowner, too.
You’re catching on quick. The Department of Energy says the typical American
household spends 15 percent to 20 percent of its total annual energy bills to
make sure there’s plenty of hot water. Power for a hot water heater is
essentially always “on” day and night, whereas you can easily turn off
electricity you don’t need.
Recouping the high cost of a solar PV system can take as long as 20 years for a
residential system. Meanwhile, a solar hot water system can cost roughly $5,000
to $8,000 to install in an existing home and can recoup its cost in seven years
on average.
OK,
I’m sold, but you’re always going to need a traditional fossil-fueled backup to
solar, whether it be electricity or hot water,
right?
That’s right. Even places in America that get 300 days of sunshine still get
300 nights plus 65 more to go along with that.
However, thanks to the efficiency, solar tends to be a majority player in
domestic hot water — we hear as much as 80 percent in sunny climates. Other
contractors in other parts of the country will conservatively estimate that 60
percent of a home’s domestic hot water load can be done with
solar.
But what about solar hot water to provide radiant
heat?
For the sake of brevity, we’re just talking about solar for domestic water. We
certainly talked with plenty of contractors who do rely on it for domestic hot
water and space heating. However, all of them said immediate applications would
be for domestic hot water; certainly not everyone has a boiler and hydronic
potential, but every home still has a conventional water heater that could be
souped up with solar.
We certainly aren’t arguing against its use; the relatively low temperatures
you get from solar hot water marry well with a well-designed radiant system.
We’ll talk more about solar radiant heat in the next issue of the Solar
Installer.
What’s
going on in other parts of the world?
Plenty. We read an article that
put the United States in 28th place, down there with Slovenia and Bulgaria, in
terms of what countries have adopted solar power on a per capita basis.
That may have been a bad joke
since we never did find the actual ranking, but other countries have naturally
had to contend with much higher energy prices for much longer than we
Americans.
Rizhao, China, population 3
million, may be the biggest city in the world that relies on solar power for
hot water. Essentially, all the people who live in the urban area rely on the
sun to heat hot water and another 30 percent of households in surrounding
villages use solar water heaters.
The local regional government
chose to subsidize research and development of solar systems rather than
existing electric water heating. Researchers were able to figure out how to do
more for less, essentially. The upfront cost of a solar hot water system was
brought down to the same level as an electric system. The government also
organized free educational seminars and created public advertising for solar
hot water, while installing the equipment on public buildings.
China is the only major country
with long-term national goals for solar hot water. If the targets are met, more
than 25 percent of Chinese households would have solar systems by 2020, as well
as big shares of commercial and public buildings. Building design and
construction in many urban areas — where almost 600 million people live —
incorporate solar hot water.
Research we saw at ISH China 2008
indicates that almost 60 percent of Chinese households intend to either buy a
solar water heater or replace their gas/electric heaters with solar equipment
within the next five years. Li Junfeng, deputy head of the Energy
Research Institute of the National Development and Reform Commission, says the
country would save more than 50 million tons of coal by 2010 by using solar
energy.
In other countries, Israel had
been the only country to make solar water heating mandatory on a national level
since the mid-1980s. More than 90 percent of Israeli households own solar water
heaters today.
In 2006, Spain implemented a new
national building code that requires minimums for solar hot water. Last year,
India, South Korea and Germany adopted some form of solar water heating
mandates for their citizens. In addition, various cities around the world
haven’t waited for their national governments to take action. Sao Paulo,
Brazil’s largest city, for example, passed a law last year requiring solar
water heating in all new buildings larger than 800 square meters (8,611 square
feet). And the city of Betim, Brazil, is installing solar water heaters in all
new public housing.
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