The Best Way To Heat Your Water – Solar PV Or Solar Thermal?

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From flat plate thermal systems to heat pumps and solar PV diverters,  in this video Finn takes a look at your solar hot water options.

Video transcript:

Did you know that there are two fundamentally different ways to generate solar energy and therefore two fundamentally different types of solar panel?

To keep it simple, I’m going to call them solar PV and solar thermal. PV stands for photovoltaic, which is the conversion of light into electricity. When most people talk about solar, this is what they mean – panels that generate electricity.

solar pv panels

Flat Plate And Evacuated Tube Solar Hot Water

Solar thermal panels on the other hand, do not generate any electricity at all. They simply use the heat from sunlight to warm up water inside the panels, and they come into types – flat plate and evacuated tube.

Flat plate systems look similar to solar PV panels, except there are about three times as thick. An evacuated tube system looks very different to both flat plate and solar PV.

flat plate and evacuate tubes

“I get it,” I can hear you say, “I should put both solar PV and solar thermal panels on my roof and get all my electricity and hot water from the sun. ”

Actually no, and I say that for economic reasons. Solar thermal used to be the cheapest form of solar water heating, but now since solar PV prices have plummeted, solar thermal has been dethroned.

To put things into perspective, the cheapest form of solar thermal is a flat plate system. That’s going to run you about $4,000 to put on your roof – and all it will do is heat your water. Meanwhile, a 6.6 kilowatt solar system these days costs you around $6,000 and could offset the electricity usage of your entire house, including your hot water if it’s electric.

So the cheaper options for solar water heating are, these days, powered by electricity – specifically solar electricity. I recommend either heat pump or diverted PV systems. Let’s look at them in a bit more detail.

Heat Pumps

A heat pump system kind of looks like a small air conditioner hooked up to a traditional hot water tank. You can also find some newer, sleeker units that look like this one.

solar heat pump

Heat pumps extract heat from the air and transfer it into the water. Now, you may be wondering why it’s considered a form of solar water heating if the sun doesn’t seem to be involved. Well, as the heat in the air originally came from the sun, you can think of it as a solar heat pump.

Most importantly, you can claim STCs otherwise known as the solar rebate, on a heat pump, which brings their cost down considerably. An entry level model will set you back about $2,000 fully installed. If you live outside Queensland or the tropics, then a modern heat pump is about as efficient as flat plate solar thermal hot water, but it doesn’t require gas to boost them in winter. A good heat pump is as quiet as a good quality air conditioner and will work well even in freezing temperatures, albeit with a reduced efficiency.

A heat pump is also a good choice if you have a generous feed in tariff, say over about 15 cents a kilowatt hour ; as its efficiency leaves more electricity available for export.

If you buy a heat pump, it’s important to try and run it off solar PV as much as possible. That means two things. One, running it in the day, and two, having enough PV to power it over and above your other appliances. I’d say at a minimum you should have 6.6 kilowatts of solar PV.

Solar PV Diverter

Now, no matter where you live in Australia, whether it’s in the tropics or in Tassie, there is a potentially even cheaper upfront option for heating water with the sun; provided you buy it at the same time as your new solar PV system. This is known as a diverted PV solar hot water system. This is the cheapest in terms of upfront costs, most reliable and lowest maintenance system, for heating hot water from the sun.

pv diverters
If you have it put in at the same time as your solar panels, it could only cost you about a thousand dollars extra.

A diverted PV system uses an intelligent control box to divert “spare” solar electricity from your solar PV panels into a conventional hot water tank. So, electrically it is about four times less efficient than a heat pump, but many people are cool with the low efficiency if it only uses solar electricity. This “spare” electricity would have otherwise been sold to the grid for a feed in tariff.

If your self-consumed solar is more valuable than your exported solar, it’s more valuable to use that solar to heat your water. But, if you have a cheap off-grid hot water tariff that is lower than your feed in tariff, diverted PV makes no economic sense. You may as well export the solar and pay for the hot water heating with that credit.

“But Finn,” I hear you cry. “If I’m powering my hot water as well won’t I need extra solar panels?”.

Yes, you will. But because of the diverter’s intelligent controller, which scavenges spare solar energy whenever it’s available, you might get away with only 1.5 kilowatts of extra panels. Meaning a 6.6 kilowatt system is the minimum size you should be aiming for – 8 kilowatts plus is probably better.

So, to summarize, if you use gas to heat your water and you want to reduce this cost by around 70 to 80% you should seriously consider transitioning to an all-electric home. The most efficient way to heat your water with solar electricity is to use a heat pump. But if you don’t want to pay thousands up front for a heat pump, a cheaper option is to get a PV diverter installed. And that’s assuming you have plenty of spare solar electricity, and assuming you’re feed-in tariff is less than your hot water tariff.

Discover everything you need to know about solar energy for your home in Finn’s book, The Good Solar Guide – free to read online.

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