Economic analysis of residential solar water heaters

A typical residential solar water heater, and typical cost and performance information are described briefly. The monthly costs and savings of the typical system are discussed. Economic evaluations of solar water heaters are presented in increasingly complex levels of detail. Utilizing a typical system, the effective interest rate that the purchaser of a system would receive on money invested is shown for all regions of the country. The importance of numerous variables that can make a significant difference on the economics of the system is described. Methods for calculating the Payback Period for any non-typical solar water heater are described. This calculated Payback Period is then shown to be related to the effective interest rate that the puchaser of the system would receive for a typical set of economic conditions. A method is presented to calculate the effective interest rate that the solar system would provide. (MHR)