Reasons to switch to solar

Thursday, 29 November, 2007

The Australian Greenhouse Office is offering households a $1000 rebate to reduce the cost of a solar hot water system.

To be eligible households must:

  • Be changing from an electric storage hot water system (which are the most emissions intensive); and
  • Have a combined family taxable income less than $100,000 a year.

The rebate applies to an existing principal place of residence and is available to both homeowners and renters. The average savings in CO2 emissions per year as a result of switching to solar from an electric storage hot water system is 2-4 tonnes.

The average savings in electricity costs is between $300 and $700 per year depending on the climate and the number of people in the household. The average solar hot water system lasts for 13 years (some even last for 20 years).

There are approximately 70,000 new hot water systems sold each year but only a small percentage are solar.

Even though electric hot water systems have a lower upfront cost, the long-term benefits of a solar system will outweigh the initial outlay. A household may have to replace two electric systems over the life of one solar system and there are lower yearly electricity costs with a solar system.

As well as the $1000 rebate from the Australian Greenhouse Office, there are further incentives to install a solar hot water system when an electric storage system is ready to be replaced.

early all solar systems on the market come with a certain number of renewable energy certificates (RECs). RECs are assigned by the Office of the Renewable Energy Regulator as part of the mandatory renewable energy target. The certificates are tradable and can be used to provide a discount on the up-front cost of a solar hot water system.

The numbers of RECs that come with a solar hot water system depend on its size and where in Australia it is installed. Each solar system sold in Australia usually comes with 20 to 40 RECS - that equates to an extra discount of $600 to $1200 on top of the $1000 dollar rebate.

Because switching from an electric storage hot water system to a solar hot water system is the simplest and most effective single measure to make a house more greenhouse friendly, most state and territory governments have their own incentives to encourage households to install a solar hot water system. In NSW, for example, switching to solar hot water attracts a rebate in the order of $600 to $800, depending on the type of system chosen.

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