Solar hot water or solar PV? Study says PV cheapest way to go

Print Friendly, PDF & Email

Analysis by Queensland solar PV company finds standard panels can heat water for households more economically than purpose built solar hot water systems.

Print Friendly, PDF & Email

New research has found that the most economical way for households to heat water is by using standard solar panels hooked up to an electric hot water system.

The research, released on Wednesday by Queensland PV company Ecoelectric, finds that solar hot water specific systems, as well as heat pump and gas systems all have greater operating costs than solar PV over the long term, as well as in terms of initial outlay.

The analysis also finds that hot water green schemes, including solar hot water system rebates and water pumping rebates, could have little effect on closing the gap between the total cost of traditional renewable water heating methods and the much lower cost of using Solar PV.

According to Ecoelectric – which bills itself as a leading specialist in solar power and hybrid battery systems – a solar PV water heating system would require no additional installation other than a timer, which tells the hot water system to run during day light hours. The hot water is then powered by the sun.

“For those looking for further cost efficiencies in their home, Solar PV can be used to heat water, you do not need to install specific solar hot water systems, which our study has shown are less cost efficient,” said Ecoelectric managing director Jeff Wehl.

“With over a million homes in Australia already having solar panels on their roofs, many people are unaware that these panels can be used to realise greater energy efficiency and savings, via the heating of water for their home.”

The company’s blog has a less formal, but perhaps more detailed, explanation of its analysis and findings, with a number of tables (including the below) to help illustrate its point.

Screen Shot 2014-11-13 at 2.03.02 PM

“As you can see,” the blog says, “the combination of a trusty old storage system with solar PV is EXTREMELY cost effective. In fact if you already have storage you would be crazy to change to anything else. If you’re looking at a new build you may be slightly better off with solar hot water, but it’s so close as to be almost negligible.”

These claims by Ecoelectric will not be welcomed by Australia’s solar hot water industry which, as we noted earlier this year, has shrunk to just one-third of its former size following unexpected policy changes in 2012.

Before these changes, as you can see in the chart below, solar hot water was, well, hot; widely considered to be the next big thing, and expected to go from strength to strength, perhaps even compensating for a rooftop PV slowdown.


Instead, rooftop solar has managed (mostly) to maintain momentum, although the local industry has expressed concern it was headed for the same fate as solar hot water, should the Abbott government make dramatic changes to the Renewable Energy Target’s small-scale scheme (SRES).

Print Friendly, PDF & Email

  1. Wilbur 5 years ago

    So what this shows is there needs to be a Heat Pump that you can directly power from PV panels without an inverter (with heat pump having a variable speed compressor). It would only require a couple of PV panels. Then perhaps have a off peak connection for the heat pump if the PV panels were not enough during the day. Then people with feed in tariffs can easily use the heat pump and not sacrifice feed in dollars.

    • Colin Nicholson 5 years ago

      Or you could get rid of all that and just use solar thermal panels with electric boost.

  2. Craig Allen 5 years ago

    There’s are market here for businesses doing conversions of gas systems to PV-electric.

  3. Colin Nicholson 5 years ago

    So I’ve visited the blog, and a few things are right … yes you can amortise the cost of the PV array at $80 a MWHr. However (using their example – for two people) that would be $175 a year for 2MWHr per year which on the face of it means a 2KW array and 2,000 dollars has been put down as capital cost of PV which is consistent. But if that was how it really worked, then you would just put up 1.5 thermal panels and call it quits.. The reason we have boost systems is because in winter the 1.5 thermal panels are not enough, and 2KW of solar is not going to be any different. To get hot water in winter (without long term storage) you would need 4KW of PVs maybe more. I run three 2 sq metre solar panels and still gas boost, and next winter it will be four – and four panels is the best part of 6KW

  4. Pied 5 years ago

    “According to Ecoelectric – which bills itself as a leading specialist in solar power and hybrid battery systems – a solar PV water heating system would require no additional installation other than a timer, which tells the hot water system to run during day light hours. The hot water is then powered by the sun.”

    How wrong is this, it would INCREASE your power bill. Your standard electric storage heaters are usually on a off peak tariff/timer. When the sun aint shining your hot water would be heated at your normal tariff, duh!

    • Chris Fraser 5 years ago

      The wires energising the heater element would have to be removed from off-peak meter circuitry, or otherwise isolated by switches from meters. I imagine there to be an upfront cost for that. And would PV generation be used for normal day-use electric circuits as a priority over hot water ?

    • WR 5 years ago

      That company is in Brisbane. In Brisbane, there are only 4 or 5 days a year when it is necessary to use the boost for 1 or 2 hours a day with solar thermal systems. I doubt it would be much different for PV-powered systems. The cost is negligible.

  5. phred01 5 years ago

    Using PV solar to heat water is not efficient with only 15% solar energy converted to electricity. 1 sqm produces 1kw @ noon with PV this is just 150 w /sqm. Evacuated tubes are much more efficient therefore a much smaller foot print is needed

    • zazu 4 years ago

      It’s not about efficiency, it’s about cost effectiveness, I’ve read many articles such as this, and they have a point.

      Solar thermal is only useful in winter, you could invest the same money in a PV panels that would last far longer instead, and use them in both in winter and summer (for cooling), heck you can even sell back electricity, which you can’t do with an idle solar water heater.

      But I guess it’s by a case by case basis, you have to do the math, estimate the costs, but it’s a new option worth considering, and for my personal case, It seems the most cost-effective and less hassle (no plumbings) gonna use it with traditional electric tank-heaters, I know it’s not as efficient as pumps, but it’s the most cost-effective.

      see for more:

      • MaxG 3 years ago

        The sources are a bit dated; electricity and PV system prices have changed significantly since…

  6. Chris russell 5 years ago

    Have to disagree I have a 24 tube 250ltr tank heets more hot water than we need 3-4 adults and saves $500 a year in gas for instant gas hot water it only cost $1500 instaled do not use the electric back up

    • Craig Ringer (2ndQuadrant) 4 years ago

      Who’d you get that from? Most installers around Western Australia are charging four times that for a regular thermal solar system, not even evacuated tube.

  7. finn 5 years ago

    Solar PV company that does not sell Solar Hot Water claims Solar PV is the best option. Who’d have thunk?

    • Spiffy Solar 2 years ago

      Good luck trying to finding a solar installer that works in solar thermal. They no longer exist—except for swimming pools . . . in places without freezing weather.

  8. MaxG 3 years ago

    The main problem is that evac tube systems are a rip-off in Australia. I am soon getting a 30 tube evac tube system for $1,000 from Germany. 🙂 Now this is cost-effective! Not the 4 grant plus here!

  9. Phil 3 years ago

    I often wondered about this approach

    I have opportunistic surplus solar panel output that could be used to heat water on all but the worst mushroom growing days.

    At the moment i use it to heat a 28 square meter room in all seasons except summer ( we are Alpine)

    But the heating is an added load on the Inverter as we are 100% off grid , so you don’t want to be running a sizeable hot water system element like 2 kilowatts most daylight hours as it effectively derates your inverter output by that amount.Meaning you can run less appliances at the same time

    So perhaps a dedicated mains pressure hot water storage tank that has it’s own solar panels is the answer with its own DC element control – no inverter needed.
    But when you go this far , as its bespoke , it will be high cost .Then you wonder why not just use an imported evacuated tube array and tank with the higher solar efficiency as many have stated here.

    Another clever option may be for someone to offer an ELEMENT CONTROL MODULE that uses the entire existing hot water system including 240v ac heater element and hot water tank and opportunistically turns on when there is spare power from the solar panels and spare inverter capacity.Think of it as an MPPT hot water system element driver

  10. Miles Harding 3 years ago

    My $0.02…

    My experiments with resistive hot water and solar PV were not terribly positive – A lot of PV was needed to overcome the heating and losses in the small-ish 160L tank. To heat a full charge of water (from 20C to 60C) will require about 11kwh. Fortunately, most days this isn’t the case, but the electrical consumption was still in the order of 5 or 6 kWh, equating to about 1Kw of PV panel (more needed in winter), or 6 square metres.

    I was surprised that the study didn’t consider heat pump and solar PV – this is an obvious pairing. Heat pumps will perform better when the air is warmer, so running them during the day when the sunis shining is most efficient. This property makes off peak electricity a problem from an energy consumption point of view.

    Heap pump units look to be divided into two camps : Conventional HFC refrigerants (R134 etc) and CO2 (R744).
    From my viewing, it looks like the conventional refrigerants are lower in COP, typically about 3 and from memory, significanly ambient termperature affected – down to COP=1 at 0C. This may explain why Rheem units also have a 10 or 15 Amp resistive heater element.

    I found one CO2 based system from Sanden, which also separates the heat pump from the tank, allowing the tank to be replaced separately. Their literature talks of a COP in the region of 4.5 (See image). They didn’t seem much more expensive than other HFC based units.This would make my experiment into a 1.5kWh per day hot water system, needing only about 300 watts of PV, or about the same roof area as an evacuated tube solar collector.

  11. Ian 3 years ago

    The study missed the main opportunity of solar pv driving a heat pump during the middle of the daytime.
    Ie sunniest and /or warmest time.
    Not sure if there is a controller yet to optimise these aspects
    Using a Sanden heat pump. It has built in programmable timer. And best COP.

    Reserving the roof for PV allows solar energy to be fully utilised throughout the year.

    It would be great to set up a submeter on a hot water system outlet in association with an electrical submeter and temp logger, and get year round kwh per kl of hot water…. on each of the options as it would be great to settle things.
    Anyone got some spare cash?

    • Steve 2 years ago

      My Sanden is set to go on 10:00 am and switch off at 3:00 p.m. With normal use I estimated that it draws about 1 kw for a couple of hours to keep three people in hot showers. Since we don’t use much electricity the opportunity cost is the feed in tariff (6 c kw hour) so cents a day for hot water (normally).

      Just need to be sure it doesn’t go on after 2:00 pm on a rainy day – tariff goes up to about 48cs /kWh!

  12. Stuart Williams 2 years ago

    Like all most of these feel good products they all have a large new outlay they all go wrong as an Electrician I have seen first hand the issues with PV systems warranties that aren’t worth the paper they are written on people expecting far more than the system will ever deliver. PV panels start to lose there efficiency from the moment they are subjected to UV and continue to degrade .To be honest with the regular cleaning of the panels and faults in inverters I wouldn’t waste your money .Do I have one NO and yes im a CEC qualified Installer and designer

  13. benny black 2 years ago

    its pretty obvious if you make electricity during the day you should maximize its use…we had a heatpump in the previous house and a solar water heater with electric booster(turned off all year but for about 10 mornings) plus electric 1.5kw pv on roof in the present home, the present set up is much cheaper and quieter.
    we are a 5 person house and a electricity bill of about $1000 a year and hot water always…..

Comments are closed.

Get up to 3 quotes from pre-vetted solar (and battery) installers.