What Is Holding Back Solar Hot Water in the US?

Solar hot water has been a commercialized technology for many, many years now. It had its heyday back in the 1980s when it seemed like everyone was putting a system on his or her roof. Even my dad, the ultra-conservative New York City money manager put one on our house in Connecticut when I was a teenager.

Unfortunately, however, the technology wasn’t all that reliable. I remember quite a few lukewarm showers and my parents’ disappointment that the system wasn’t exactly performing like it was supposed to. From those I’ve spoken to, my parents’ experience with solar hot water in the ’80s wasn’t all that unique, either.

As Dad always said, (and I’m paraphrasing here) “as soon as the price of oil went down, no one cared about solar anymore.” He finally paid someone to remove the system in the early 2000s. 

But even if my parents stopped caring about solar hot water as soon as the price of oil went down, the passionate solar engineers didn’t stop working to better the technology. And over the last 30 years, the technology has undergone some major improvements.

That’s why today it is well-known in the solar industry that solar hot water pays for itself in as a little as five years, even less in some locations. And globally the technology is widely used. “There are whole countries and parts of the world where it’s completely ubiquitous,” said Zach Axelrod CEO of Skyline Innovations, a Washington, DC-based company that has in a sense turned the value proposition of solar hot water on its head. 

Instead of selling solar hot water, Skyline Innovations sells savings.

The company doesn’t even really talk about “going green” or doing right by the environment in its sales pitches. Instead Skyline Innovations just focuses on the guaranteed utility-bill savings it offers its potential commercial customers, which range from housing complexes to laundromats. “You are absolutely right, we are not selling solar, we are selling guaranteed savings,” Axelrod told me.

Skyline has just expanded to California and recently announced the completion of solar water heating systems for three multifamily buildings in southern California, owned by Williams Holdings. Skyline said it provided the solar water heating systems at no upfront cost, and Williams Holdings will receive a 25 percent fixed discount on its utility rate for water heating. (Oh, and solar hot water, too.)

Skyline Innovations isn’t the first company to innovate how to sell solar hot water and it won’t be the last. Now, some U.S. states are starting to recognize the potential of the technology. Just this week Maryland approved an adjustment to the state’s renewable portfolio standard (RPS) that allows it to use solar hot water to meet the solar portion of its RPS, also called its solar carve-out.

Admittedly, the industry still has some barriers to overcome in the U.S. Namely it needs to change the minds of those people who installed solar hot water and found it didn’t work as promised. But if Skyline is ready to build its entire business around a guaranteed savings, then you can be sure the technology, at least the technology that Skyline is using, has got to work. For Skyline Innovations, solar hot water is simply money in the bank.

Keep your eye out for a longer feature story on the U.S. solar hot water industry in the coming month. And if you have something to contribute, let me know by leaving a comment in the section below. Or send me an email: click on my picture and fill out the contact form.

Lead image: Money in Hand via Shutterstock

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Jennifer Runyon has been studying and reporting about the world's transition to clean energy since 2007. As editor of the world's largest renewable energy publication, Renewable Energy World, she observed, interviewed experts about, and reported on major clean energy milestones including Germany's explosive growth of solar PV, the formation and development of the U.S. onshore wind industry, the U.K. offshore wind boom, China's solar manufacturing dominance, the rise of energy storage, the changing landscape for utilities and grid operators and much, much, more. Today, in addition to managing content on POWERGRID International, she also serves as the conference advisory committee chair for DISTRIBUTECH, a globally recognized conference for the transmission and distribution industry. You can reach her at Jennifer.Runyon@ClarionEvents.com

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