Before you read this column, please read the article “Solar Thermal is Dead” by Martin Holladay at: http://www.greenbuildingadvisor.com/blogs/dept/musings/solar-thermal-dead?utm_source=April+26,+2012&utm_campaign=Email+Newsletter+Analytics&utm_medium=socialshare.
Color me stunned! No, not so much by the title that solar thermal (ST) is dead, but by Martin Halladay’s use of a fixed-price of $7,000 for a 1.7-kW PV solar system’s installed cost while, in the same paragraph, giving a range of $8,000 to $10,000 for a two-panel ST system. He then uses the $7,000 PV price compared to the $10,000 solar thermal price to make his case. Is ST really dead or dying? Read on and decide for yourself.
As a solar contractor who installs both PV and thermal systems, I’ll go along with the $8,000 to $10,000 average for ST even though it’s really broader on both ends in the real world. However, at $7,000 for a 1.7-kW system, that is $4.12 per installed watt and substantially lower than the average of $5.00 to $5.50 we find in southeastern Pennsylvania. The unfortunate result of such misleading information is consumers readily assume that it is etched-in-stone and conclude that designers/installers charging more are reaping extraordinary profits or are simply rip-off scammers. At $5.00 to $5.50 per installed watt, or $8,500 to $9,350 for the 1.7-kW system, solar thermal and PV utilized in Halladay’s article move within spitting distance of each other for real-world average installed costs.
Let’s compare, side-by-side, a 1.7-kW PV versus a two-panel (each 4’x8’) ST installation using the Solar Pathfinder, www.solarpathfinder.com, a site assessment tool recognized by Pennsylvania’s Department of Environmental Protection (DEP) PA Sunshine program (certified and listed installers must provide a valid site assessment for the solar system to be accepted by PA Sunshine). Solar Pathfinder lists a yearly total of 14,443,000-Btus required to meet the DHW demand-load of 64-GPD with 55°F incoming cold water, and tank target temperature of 120°F.
Watt-for-watt over an entire year’s solar-harvest:
- ST harvest = 10,350,000-Btus or 3,033.41-kWh
- PV harvest = 1,834.00-kWh
Utilizing an electric-assisted solar storage tank:
- ST harvest = 71.6% of the total year’s DHW usage. Customer pays $138.75 for electric element to complete heating DHW.
- ST ECV = $349.80. A 30-year accumulated ECV with yearly increase of 3.5% for electricity = $18,057.61.
- ST ROI = 349.80 ÷ 8,000 = 4.4%.
- PV harvest = 43.3% of the total year’s DHW usage. Customer pays $277.01 for electric element to complete heating DHW.
- PV ECV = $211.54. A 30-year accumulated ECV with yearly increase of 3.5% for electricity = $10,920.56.
- PV ROI = 211.54 ÷ 8,000 = 2.6%.
Halladay brings heat pump water heaters (HPWH) into the mix in order to pump-up the ECV for PV. A heat pump water heater can be an excellent fit for the right application, but as Halladay notes, that adds approximately $3,000 to the costs. With an EF (energy factor) of 2.35 and usage of 64-GPD with target temp of 120°F and 55°F incoming cold water, the yearly cost for DHW if electricity is 12-cents per kWh is $189.18.
Apply the PV harvest to the power required for the HPWH:
- Total energy required 14,443,000-Btus = 4,233-kWh ÷ 2.35 = 1,801.28-kWh.
- PV harvest = 1,834.0-kWh. Customer (grid connected) receives a $3.93 credit.
- ECV = $189.18 + $3.93 = $193.11. A 30-year accumulated ECV with yearly increase of 3.5% for electricity = $9,968.86.
- ROI = 193.11 ÷ 11,000 ($8,000 PV system + $3,000.00 for the HPWH) = 1.8%
After applying tax credits and incentives, the ROI in each scenario will likely be two to two and a half times the percentages listed. Visit www.dsireusa.orgfor tax credit and incentive information for your state.
Is solar thermal dead? Hardly! Is PV giving ST a run for the money? Under the right and currently limited application using a HPWH or, better yet, an inverter air-to-water heat-pump like the Daikin Altherma – absolutely. Is one more reliable than the other? Reliability and a long trouble-free life depends entirely upon the installers’ skills and knowledge, plus the use of best-quality (not the cheapest) components.
The majority of ST systems have a circulator (moving parts), which is an extremely reliable long-life component that costs less than $200. The 1.7-kW PV system has an inverter to convert DC to AC voltage that costs more than $2,000. Both systems have panels that will last well beyond 30 years. If, as is suggested by some, the circulator and the inverter are the most likely to fail component, the anticipated repair-costs would certainly tilt the favor towards ST.
As a plumber, there is another glaring issue being overlooked that will greatly impact this argument: the hot water tank. If a standard glass-lined tank, as suggested by manufacturers, lasts 13 years, the customer will be faced with two replacements during the 30+ year life of the solar system. Add the increased cost for labor and materials and a $3,000 steel glass-lined tank installed today might cost $4,500 in the 13thyear and $6,850 in the 26thyear. A stainless steel tank, on the other hand, is projected to last 30 years or longer.
You can review the Solar Thermal and PV Solar Pathfinder reports, along with the Cost to Heat DHW report, utilized for this column.
You can read my three-part series on HPWH usage on Contractor’s website at: http://contractormag.com/columns/yates/selling-pump-water-heateers-0610
http://contractormag.com/columns/yates/heat-pump-water-heaters-2-0710
http://contractormag.com/columns/yates/hp-water-heaters-0810
All Dave Yates material in print and on Contractor's Web site is protected by Copyright 2012. Any reuse of this material (print or electronic) must first have the expressed written permission of Dave Yates and Contractor magazine. Please contact via email at: [email protected].