Solar water heating systems use clean, free energy from the sun to heat your hot water, which accounts for about 15 to 20% of your homeâ€™s energy.
Renewable energy systems do have an up-front installation cost of $3,000 to $,6000 but youâ€™ll enjoy an instant reduction on your utility bills. Keep in mind that these systems are not designed to provide 100% of your homeâ€™s water requirements because of the amount of cloudy days in a year.
You can expect them to meet between 50 to 75% of your hot water needs, so having a backup water heater is a necessity.
Tax credits are available for qualified solar water heating and photovoltaic systems.
The credits are available for systems placed in service from January 1, 2006 through December 31, 2016. The tax credit is for 30% of the cost of the system, up to $2,000. After December 31, 2008, this $2,000 cap will be removed for photovoltaic systems (but not solar water heaters).