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What Is a Solar Hot Water Heater? (2024 Guide)

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Author Image Written by Tamara Jude Updated 04/05/2024

Solar water heaters harness the sun’s abundant energy to provide hot water for your home. They’re an eco-friendly and cost-effective solution offered by many of the top solar companies, and they don’t require a full solar system to function. This means you can reduce your carbon footprint and lower your energy bills without installing a large array of rooftop solar panels. 

Our guide explains how solar water heaters work, the different types available, and whether this technology is a good investment for your home.

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What Do Solar Hot Water Heaters Do?

Solar water heaters use solar power to produce hot water. They can either supplement your existing water heater, significantly reducing your reliance on fossil fuels, or completely replace it. With a solar water heater, you’ll enjoy lower monthly energy bills and a smaller environmental footprint—plus all the hot water you need for bathing, laundry, cooking, and radiant space heating.

To learn more about how solar water heaters work and what goes into installing one, check out the video below with plumbing and heating expert Richard Trethewey and contractor Bob Dudley:


Types of Solar Water Heaters

There are two types of solar water heaters: active and passive. Active systems use circulating pumps and controls to move water or heat-transfer fluid, while passive systems rely on the sun’s heat and natural convection to circulate water. Each type can be further broken down into two subtypes, which we explore below.

Active Solar Water Heating Systems

Passive Solar Water Heating Systems

Active solar water heating systems come in direct or indirect circulating systems. They are more efficient than passive systems, but also more complex.

  • Direct circulation systems: These systems use pumps to circulate household water through the collectors and into the home. A direct circulation system is ideal for climates that rarely experience freezing temperatures.
  • Indirect circulation systems: This system uses pumps to circulate a non-freezing heat-transfer fluid, such as antifreeze, through the collectors and a heat exchanger. This process heats the water, which then flows throughout your home’s plumbing. Indirect circulation systems are better for cold climates prone to freezing temperatures.

Passive solar water heating systems have a simpler design with fewer moving parts, which can lead to lower maintenance costs. However, they are less efficient in cold climates. The two types of passive systems are integral collector-storage (ICS) and thermosyphon systems.

  • ICS or batch systems: These systems work best in areas where temperatures rarely fall below freezing. We recommend this passive system for households with significant daytime and evening hot water needs.
  • Thermosyphon systems: With these systems, water flows through, and warm water rises as cold water sinks. The collector, located below the storage tank, helps the warm water rise into the tank. These systems are reliable, but they have heavy storage tanks that not all roofs can support.


Solar Hot Water Heater Cost

The cost of a solar water heater varies depending on the type of system, tank size, location, and other factors. According to our research, solar water heater installation costs between $1,800 and $5,800,* or $3,700 on average. However, most solar water heaters qualify for a federal tax credit worth 30% of their cost. This program stays in place until 2033, after which the credit drops to 26% in 2033 and 22% in 2034. Unless Congress intervenes, the credit will expire in 2035.

Many states and municipalities provide additional incentives for solar water heaters, such as rebates, property tax exemptions, sales tax exemptions, and tax credits. Some utility companies also offer rebates or incentives to encourage customers to switch to solar water heaters. You can learn more on the Database of State Incentives for Renewables & Efficiency (DSIRE) website.

We suggest contacting a professional solar company to learn what the project will cost you. Reputable solar installers will also be knowledgeable about available incentives in your area and can help you navigate the application process.

*Cost data sourced from contractor estimates used by Angi.


Are Solar Water Heaters Worth It?

Solar water heaters provide many benefits, from significant cost savings to a reduction in your carbon footprint. Below, we explore why solar water heaters are worth it.

  • Cost savings: Similar to solar panels, solar water heaters harness the sun’s free and abundant energy to reduce your water heating expenses, which account for about 18%.
  • Eco-friendliness: Embracing a solar water heating system advances environmental sustainability and clean energy. Using renewable energy reduces greenhouse gas emissions and reduces your reliance on fossil fuels.
  • Energy efficiency: Solar thermal systems maximize energy efficiency. Modern solar collectors are highly efficient, ensuring optimal performance and effective yearly water heating.
  • Reliability: Manufacturers design solar water heaters to be reliable and durable, often built to withstand harsh weather conditions. With proper installation and regular maintenance, these systems can provide reliable hot water for up to 20 years. That’s roughly five to 10 years longer than conventional water heaters.
  • Return on investment (ROI): While the initial investment in a solar water heater is hefty, it provides long-term returns. With reduced energy bills and government incentives available in many regions, the system pays for itself over time. Most solar water heaters have a payback period of roughly two years.
  • Versatility: You can integrate solar water heaters into existing homes and new construction projects. They can work in tandem with conventional water heaters, or they can function as stand-alone systems. Additionally, various system configurations are available to suit different climates and household sizes, making solar hot water heaters a versatile and adaptable choice.

Hidden Costs and Downsides of Solar Water Heaters

While a solar water heater offers numerous benefits, it’s crucial to understand its potential challenges and hidden costs to ensure it’s a sound investment for you.

Backup heating system: Solar water heaters may require a backup heating system, especially during prolonged periods of low sunlight or high hot water demand. A technician may suggest an extra gas or electric water heater backup system to ensure a continuous hot water supply. This addition increases the overall installation cost and your energy consumption.
Maintenance: Solar water heaters are generally low maintenance, but inspections and maintenance every three to five years are necessary to ensure optimal performance. Components such as pumps, valves, and storage tanks may require occasional repairs or replacements over the system’s life span.
Sunlight availability: Solar water heater efficiency relies heavily on sufficient sunlight exposure. The system’s performance may be compromised if your property is surrounded by shading from trees or buildings.
Upfront cost: While long-term savings can be significant, a solar water heater’s initial investment is higher than a conventional water heater. We recommend assessing your budget and weighing it against the potential long-term benefits.

Our Conclusion

Installing a solar water heater can help you lower your energy costs, reduce your environmental impact, and enjoy reliable hot water for years to come. Although solar water heaters cost more than conventional ones, they offer long-term savings. Federal, state, and local incentives are also available to offset the initial cost.

Like other water heaters, a solar water heating system isn’t the most DIY-friendly project. We recommend hiring a solar company to ensure proper installation and optimal performance.

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FAQ About Solar Hot Water Heaters

How hot can water get with a solar heater?

Most solar water heaters can heat the water up to 180–200 degrees Fahrenheit, just like a conventional water heater. Passive systems generally have a lower max temperature than active systems, but how hot the water can get varies by model, sunlight intensity, and tank insulation.

Can I use a solar water heating system in place of my existing traditional gas or electric hot water system?

Yes, solar water heating systems can either supplement or replace your existing hot water system.

Do solar water heaters work at night?

Yes, most solar water heaters store the hot water generated during the daytime so they still work at night. In addition, most active solar water heating systems include backup heating elements to ensure hot water is available when there is no sunlight. The size of the tank and your hot water usage patterns determine how much is available at night.

Is it safe to drink water from solar hot water systems?

It depends. Solar hot water systems heat water, but they don’t purify it. As long as the water going into the system is potable, safe-to-drink water, the water coming out of the system will also be safe to drink.

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