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Solar Thermal Panels: Reduce Your Energy Bill (and Carbon Footprint)

Stephanie is always looking for ways to lighten her carbon footprint. She is enthusiastic about solar power and solar gadgets.

One of the easiest ways to make the switch to renewable energy in your home or business is with a solar hot water system. Solar thermal panels allow you inexpensive and nearly unlimited hot water for bathing, laundry, dishes, and countless other uses. Many homeowners install solar panels to heat their swimming pools and spas.

On the commercial side, some car washes now use solar hot water. Breweries and garden nurseries are among businesses that can benefit from the cheap hot water provided by solar thermal panels. Green hotels and spas also cut their massive energy usage by using solar energy to heat water for their pools, laundry, and showers.

Compared to solar electric (photovoltaic or PV) panels, solar thermal panels are typically more affordable, and your return on investment is quicker. Not only that, but solar hot water systems are eligible for a number of government rebates, tax credits, and other incentives. Solar power is going mainstream these days as people look to save money while reducing their carbon footprints!

Ready to consider tapping into cheap hot water with solar thermal panels? Read on!

Solar thermal panels

Solar thermal panels

Why Switch to Solar Hot Water?

If you are looking to save energy and money, one of the biggest power hogs in most homes is an electric or natural gas hot water system. With solar thermal panels and a specialized solar hot water tank, you can instantly see a reduction in utility bills for little money upfront.

In fact, solar hot water systems are both cheaper and more efficient than PV solar panels. When you consider federal and state tax incentives, credits, and rebates, homeowners can recoup their investment in as little as two years, although the average ROI is about 4-8 years. Because solar thermal collectors use radiant solar energy, they are more than three times more efficient than photovoltaic panels. That means for every hour of sunlight, you are able to convert three times as much energy for use within your home or business.

The California Energy Commission estimates that by installing a solar hot water system, the typical household can cut 60-70% off their annual water heating expenses!

Components of a Solar Hot Water System

There are several components of a solar hot water system, none of which are complex. If you hire a professional to help with installation, you can have cheap hot water within a day.

Generally speaking, you need the following:

  • Solar thermal panels (also known as solar collectors)
  • Mounting system for the solar thermal panels (usually installed on rooftops)
  • Solar storage tank - in other words, your new solar hot water tank
  • Water pump and controls (not required for passive or thermosyphon systems)
  • Heat exchanger and expansion tank (only for closed-loop solar hot water systems)
  • Isolation valve
  • Backup Water Heater
  • Tempering valve - to make sure your solar heated water doesn't get too hot!

How Does a Solar Hot Water System Work?

Depending on the type of solar thermal panels (solar collectors) and solar hot water system you install, the mechanics of heating water with solar energy are fairly simple. Two general types of solar hot water systems exist: active and passive.

Active systems

Let's start with active/pump-driven systems, which come in two options for residential purposes: direct or indirect circulation. In warm climates, direct circulation systems simply pump the cold water through the solar thermal panels where radiant heat from the sun warms it. From there, the water is pumped into the holding tank for use. Since the water is heated directly by radiant energy, it is called an "open-loop" system.

If you live in a colder area of the world, where freezing temperatures are often experienced, use an indirect active pump system. Instead of water pumped through the solar collector, a heat transfer liquid (which resists freezing) circulates through the panels as well as a heat exchanger, gets warmed, and then transferred to the storage tank where the water is heated by the warmed-up heat transfer liquid. These are often called "closed-loop" systems.

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With an active system, you need electrical pumps and controls to move cold water through the solar thermal panels into the storage tank. Additional equipment means more expense and maintenance.

Passive systems

As the name implies, a passive solar thermal panel hot water system does not require pumps but rather uses thermal dynamics to move hot water through cold water (heat rises, remember?) With passive solar hot water systems, no pumps or other mechanical devices are required, which often makes them cheaper and more affordable for homeowners. There are two general types of passive systems: batch systems (also called Integral Collector Storage, or ICS) and thermosyphon (also spelled thermosiphon) systems.

The latter is the more commonly used by households. They rely on thermodynamics and require both the solar collector and storage tank to be placed on the rooftop (hot water rises from the panels to the storage tank).

No matter which type of solar hot water system you use, most people keep a backup hot water tank for days when there is low UV light and/or when solar energy cannot heat enough water for your requirements.

What Types of Solar Thermal Panels are Available?

There are several types of solar thermal panels that can be used with solar hot water systems. Like the systems themselves, the panels you select will depend on your climate and hot water needs.

Flat-plate solar collectors: These look much like their PV solar panel cousins. Unglazed, flat glass or plastic plate coverings fit over an insulated box in which a dark absorber plate is placed. These solar thermal panels are often used for swimming pools and spas.

ICS or Batch Collector-Storage panels: These are characterized by black tanks or tubes, also in an insulated box. As cold water passes through the tanks or tubes, it is warmed by radiant energy, and from there flows toward the storage tank for use.

Evacuated tube solar collectors: These are commonly used for commercial solar hot water applications. They consist of parallel rows of glass tubes and also include metal absorber tubes attached to a fin.

Why Install Solar Thermal Panels for Hot Water?

There are many reasons you may want to use renewable energy to heat the water for household domestic uses:

  • Protection against rising electricity and/or natural gas costs
  • Pay for the cost of the system only, and not for the energy to heat water
  • Quick return on investment (ROI) in a matter of years
  • Adds value to your home
  • Live with a smaller carbon footprint
  • Federal, state and/or local rebate and incentive programs help defray the costs and lower your tax burden
  • Low maintenance over the life of the system (about 20-30 years)

There are a number of DIY solar hot water systems available. It can be a relatively simple weekend project, depending on the type of solar collectors you select, and whether you are going with an active or passive system.

For closed-loop systems and those requiring pumps and heat exchangers, it is recommended that you hire a professional solar thermal system contractor. Paying just a bit more for the service can save you headaches later. Contractors can even help you maximize your tax savings or apply for rebates!

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

© 2011 Stephanie Marshall


Umesh Chandra Bhatt from Kharghar, Navi Mumbai, India on February 21, 2020:

Well presented and well explained. Good reading. Thanks.

oulande Mendy on May 08, 2018:


Dale Anderson from The High Seas on May 03, 2018:

This is an excellent hub, well done! It is information that more people need to know and be called to action on. I am using a contact of mine to have a solar water heater installed in my good friend's sisters house o heat both her pool and her household water.

Macka on May 01, 2015:


We have 4kw solar on roof for house and Evac Tubes (30) for 315ltr HWService.

We run the house and an 8 X 4 Mtr pool out back. ALl yr.

and get around $650=700 cash returns every yr from power company.

If I heat the pool for winter ?(around 12 weeks) it costs around $1100 minus the $650 ish, to keep it at 30/32 deg living in Central Queensland Australia.

Anybody who does NOT have solar in a home they keeping long term is a financial fool. Prices are only going up.

I've been using solar on yachts and caravans since the '70's.

A coupla rolls of 100mtr 10/12/15mm blackpoly hose laid out in back garden up here.linked to a low pressure 12v pump and coupled to water system in pool also helps it along too.

Solar panel. Battery. small in line 12mm 12v pump and switch for isolating.

self sufficient too.

Stephanie Marshall (author) from Bend, Oregon on August 06, 2012:

Hi Mary - thank you! Please feel free to link to your solar lights hub. I'm off to go give it a read. Cheers, Stephanie

Mary Hyatt from Florida on August 06, 2012:

This Hub is a related one to the one I just published on using solar lights for a pathway to replace low voltage lights. This is a very informative Hub. I voted it UP, etc. and I'd like to share.

May I link this Hub into the one I just published? Check mine out when you have some time.


renewable sources on May 05, 2011:

Solar panel system has gained lot of popularity in the recent time, as it has been proved as the best alternative source of energy. It also helps in saving money from the electricity bills. Nice article, thanks for sharing.

Xavier Nathan from Isle of Man on March 30, 2011:

What an excellent hub! You have explained it all so clearly and it sounds as if you guys in the States have made it an accessible option for the ordinary Joe blog to afford. We are still very behind you over here and I am looking forward to the time when every house creates its own electricity naturally like this. Thank you. Voted up useful and awesome.

Stephanie Marshall (author) from Bend, Oregon on March 25, 2011:

Thanks LRC - these are so affordable! We were on vacation and the property was complaining about the cost to heat the swimming pools - solar hot water makes a ton of sense.

LRCBlogger on March 25, 2011:

This is something I have been considering (how to make my home more green friendly). Thanks for the great info

Stephanie Marshall (author) from Bend, Oregon on March 04, 2011:

Thank you prasetio! I am a big supporter of solar energy, and any other renewable resource that can reduce our use of fossil fuels. Best to you, Steph

prasetio30 from malang-indonesia on March 04, 2011:

Nice information and very inspiring us. I know we need alternative energy to support our life to replace fuel energy. Solar energy is one of the best. I learn much from you. Keep it up. I give my vote to you. God bless you. Cheers...

Love and peace,

Stephanie Marshall (author) from Bend, Oregon on February 28, 2011:

Thanks Mike! I hope that more people adopt solar energy too!

Mike Outdoors from Somewhere in Canada on February 28, 2011:

Very interesting. I wish more people would adopt solar energy.

James on February 20, 2011:

Great info, nice hub, thanks for sharing, thumbs up :)

Stephanie Marshall (author) from Bend, Oregon on February 20, 2011:

Hi Audrey - thank you! We get so much sunshine in Central Oregon that it only makes sense to consider solar power. We are thinking about one of the solar leases (for PV power) that are now offered in Oregon too. Do let me know if you install solar at your home! I'm very interested!

Slushy on February 19, 2011:

Wow, that was the longest hub I've ever come across! :D

Good information here, we should all switch to more renewable energy components whereever possible and affordable.

Audrey Kirchner from Washington on February 18, 2011:

We're due to have an energy assessment but have to wait until APRIL - you have to be kidding me because our square footage was too great for the February slot. This sounds a little ridiculous to me...but all that aside, I'm going to be asking some serious questions about what we can do (that we can afford) to make our home more energy efficient and cut the high costs of utilities.

It seems to me between the sun here and the wind on our ridge where we live, we should be able to get something going!! Of course then pops up that annoying question, can we afford it - but we shall see!

Great piece as always and I love that you are so pro-environment!

Stephanie Marshall (author) from Bend, Oregon on February 17, 2011:

I hear you Jeff! Same here!

Jeffrey Penn May from St. Louis on February 17, 2011:

Good info. I've always thought I'd have a solar powered home, then I got married and had kids and embraced the full catastrophe.

Stephanie Marshall (author) from Bend, Oregon on February 16, 2011:

Hi Darski - you are right that solar is getting more affordable these days. I hear you about limited income and I wish that there were more programs for people like you. You can guard against future utility rate hikes with solar, though, as you noted. Peace and love to you as well! Best, Steph

Darlene Sabella from Hello, my name is Toast and Jam, I live in the forest with my dog named Sam ... on February 16, 2011:

My friend, I have been thinking about solar for months now, except I am a senior on limited income, I really need this for the future of cost of Utilities and all the other bills. This has been around for a long time, and finally getting a wee bit affordable. I want to learn as much as possible and thank you so much for this excellent hub. Rate way up love & peace darski

Stephanie Marshall (author) from Bend, Oregon on February 16, 2011:

Thank you Robie! Yes, its helpful to understand the mechanics of a solar hot water system. For families like mine that use a fair amount of hot water, it makes perfect sense. Cheers, Steph

Roberta Kyle from Central New Jersey on February 16, 2011:

What great information on thermal solar panels. You explain it all so well. I think I now understand how it works. If I didn't have a very efficient little on demand water heater I'd consider going with solar. Great and very informative hub

Stephanie Marshall (author) from Bend, Oregon on February 16, 2011:

Thanks NN! For people thinking about going solar, this is one of the easiest and most affordable ways to use renewable energy.

Nancy's Niche on February 16, 2011:

Excellent information; love the idea of the solar thermal panels. Thanks for sharing this information…

Stephanie Marshall (author) from Bend, Oregon on February 16, 2011:

Hi Dallas and Gordon - there is a lot of potential for this type of solar energy. Even in Scotland, Gordon! Bright, fully sunny days are not required for effective solar hot water systems. Just a bit of UV light.

I appreciate the comments, as always! Best, Steph

Gordon Hamilton from Wishaw, Lanarkshire, United Kingdom on February 16, 2011:

Fabulous information, Steph. It is important for people who have alternative energy options and solutions to make the most of them and look at different ways to use environmentally friendly resources. My only problem with solar power is that - in Scotland - it would be Christmas 2014 before I had enough hot water to make a cup of coffee... :)

Dallas W Thompson from Bakersfield, CA on February 16, 2011:

Lots of great information. Thanks for sharing. Thumbs up and useful!

Stephanie Marshall (author) from Bend, Oregon on February 16, 2011:

Hi kashmir and Dexter - thank you so much! I often publish on solar power topics and the idea of solar thermal panels and solar hot water is so great. Cheaper and more efficient than PV solar electric panels. Its a great way to save money and the environment too! Cheers, Steph

Dexter Yarbrough from United States on February 16, 2011:

Great information. Thanks!

Thomas Silvia from Massachusetts on February 16, 2011:

Hi stephhicks68, all great and much needed information and ides to help save money heating your home and your water .

Awesome hub !!!

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