Welcome to the Webinar! We will start at 11:00 a.m ...€¦ · Industry Review: Low-Cost Cold Climate Solar Water Heating Roadmap Welcome to the Webinar! We will start at 11:00 a.m

Building Technologies Program

Industry Review: Low-Cost Cold Climate Solar Water Heating Roadmap

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Today’s Speakers Kate Hudon - Project Leader, National

Renewable Energy Laboratory (NREL)

Ms. Hudon is a project leader in the

Residential Buildings Research Group at

NREL. She is currently leading a low-cost solar

water heating project, with a research focus on

affordable solar water heating solutions for

cold climates. Prior to this role, her research

focused on evaluating emerging technologies,

which included an extensive laboratory

evaluation of heat pump water heaters

(HPWHs).

Bill Goetzler – Director, Energy Practice

Navigant Consulting, Inc.

Mr. Goetzler focuses on technology/market

assessments and strategic planning for public

sector organizations, utilities, and

manufacturers of products such as HVAC

equipment, building controls, lighting, and

renewable energy systems. Prior to joining

Navigant, he was an Associate Director at

Arthur D. Little, Inc., where he managed the

HVAC and Building Energy Systems unit. He is

an AEE Certified Energy Manager and holds a

B.S. from MIT and an M.S. from Stanford

University, in Mechanical Engineering.

Sean Ong – Energy Analyst, National


Mr. Ong holds a degree in physics from Seattle

Pacific University and began his career at NREL

in 2008. Since then, Sean has published studies

on topics ranging from the economics of

photovoltaic systems to land-use characteristics

of large wind farms. He focuses on technical and

economic analysis of solar energy systems, land

use requirements of large solar and wind

facilities, and the impacts of retail rate structures

on distributed generation.

Jay Burch – Senior Scientist, National


Mr. Burch joined NREL in 1982. He has led the

Low-Cost Systems Project for the development

of low-cost, polymer-based residential solar

domestic water heating systems at NREL since

1997. He is also involved with the development

of modeling, optimization, and test methods for

residential and commercial buildings. Prior to

joining NREL, Jay worked at the Colorado

School of Mines as an assistant professor

researching thermal modeling of buildings and

measurement of heat transfer processes in

buildings.


Webinar Objective and Agenda

Low-Cost Cold Climate

Solar Water Heating

Roadmap Webinar

Kate Hudon

July 28, 2011

NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Webinar Objective

Main Objective of Today’s Webinar

– Support the development of a roadmap for innovative low-cost solar water heating solutions in cold climates. NREL will submit the completed roadmap to DOE in September and its contents will provide guidance for low-cost solar water heating research going forward.

How to Achieve Objective

– Gather Feedback from Webinar Participants

• Q&A session – focused on opportunities and barriers to low-cost solar water heating solutions for cold climates.

• Participant feedback will provide industry perspective that is key to guiding solar water heating research going forward.

• Please submit written questions and comments throughout the webinar!

Long-Term Objective

– Use the system development pathways in the roadmap to pave the way toward cost-effective solutions. These solutions would result in a healthy solar water heating market with significant market penetration.

NATIONAL RENEWABLE ENERGY LABORATORY

Webinar Agenda

11:10am Market Overview – Bill Goetzler, Navigant • Current System/Installation Costs

• Market Penetration

• Competing Technologies

11:20am Economic Analysis – Sean Ong, NREL • Break-Even Maps

11:30am Example Pathways from other Markets – Bill Goetzler, Navigant • Existing Low-Cost Pathways in non-US Markets

• Technical and Market Gaps and Barriers

11:45am Detailed Pathway Options – Jay Burch, NREL • Requirements for Low-Cost Systems

• Polymer Option

• Glass Option

• Hybrid Systems

12:00pm Q & A: Opportunities and Barriers to Innovative Solar Hot

Water Products for Cold Climates. Please submit your

questions!


0

Low Cost Solar Water Heating Webinar

Market Overview and Examples from Other Markets

July 28, 2011

William Goetzler Director Navigant Consulting, Inc. Burlington, MA [email protected]

©2011 Navigant Consulting, Inc.

E N E R G Y

mailto:[email protected]

Table of Contents

2 Examples from Other Markets

1 Market Overview

©2011 Navigant Consulting, Inc. 1

E N E R G Y

Market Overview » U.S. Solar Thermal Market › HŔŞşŚŝŔŎŌŗ TŝŐřŏŞ

After 33% compound average annual growth (CAGR) prior to 1981, the U.S. market declined dramatically, and since 1991, CAGR has been 6%.

Total U.S. Shipments of Solar Thermal Collectors

-

200

400

600

800

1,000

1,200

1,400

1,600

Sh

ipm

ents

(M

Wth

)

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

33% CAGR 6% CAGR

0

5,000

10,000

15,000

20,000

25,000

2007

2008

Sh

ipm

ents

(T

ho

usa

nd

s o

f sq

ft)

*DŌşŌ ŝŐśŚŝşŐŏ Ŕř ęĘĘĘ’Ş Śő ŞŜƱőşƱ MWşœ ŔŞ ŎŌŗŎŠŗŌşŐŏ ōŌŞŐŏ ŠśŚř Ōř ŔřşŐŝřŌşŔŚřŌŗŗŤ ŌŒŝŐŐŏ ŠśŚř ŎŚřšŐŝŞŔŚř őŌŎşŚŝ Śő ĘƱğ ŖWth/m2. SŚŠŝŎŐƳ IřşŐŝřŌşŔŚřŌŗ EřŐŝŒŤ AŒŐřŎŤ’Ş SŚŗŌŝ CŚŚŗŔřŒ Ōřŏ HŐŌşŔřŒ PŝŚŒŝŌŘƲ SŚŗŌŝ HŐŌşŔřŒ WŚŝŗŏŢŔŏŐ 2008 Edition, Industry Interviews, Navigant Consulting, Inc. based on data from Energy Information Administration, Solar Thermal Collector Manufacturing Activities 2008 & Renewable Energy Annual. Annual installations domestic production and imports of low, medium and high temperature collectors. CAGR – Compound Annual Growth Rate


E N E R G Y

-

-

Market Overview » U.S. Solar Thermal Market › Value By Market Segment

The hot water and heating market represents nearly 70% of the market value, but only 16% of the area of collectors shipped.

2008 Market Segmentation

Heating and

hot water

16%

Pool Heating

84%

Area of Collectors

Shipped by Use

Total area shipped

17 mill Sq Ft

Total number of Systems shipped

64,000-82,000

Heating and

hot water

51 61%

Pool Heating

39-49%

Number of Systems

Shipped by Use

Heating and

hot water

61 70%

Pool Heating

30-39%

Market Value by Use

Total Market Value

$260-$495 million

Source: Navigant Consulting, Inc. analysis based on data from: Industry Interviews, Energy Information AŏŘŔřŔŞşŝŌşŔŚř’Ş Solar Thermal and Photovoltaic Collector Manufacturing Activities 2008 and Renewable Energy Annual, and internal analysis. Note: Pool Heating System size was assumed to be 350-400sqft; Non-pool heating systems were assumed to be 50-64 sqft.

The dashed line represents the level of uncertainty in the calculations and should be considered as a range.


E N E R G Y

Market Overview » U.S. Solar Thermal Market › GŝŚŢşœ PŝŚŕŐŎşŔŚřŞ

With optimistic U.S. market growth, the total value of the market could reach $2-4 billion later this decade.

Market Value Projection for the U.S. SWH Industry

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

Mar

ket

Val

ue

($M

M)

2010 2011 2012 2013 2014 2015 2016 2017

BAU

High

CAGR 15% CAGR 24%

Source: Navigant analysis. Market Growth Assumptions System Size: domestic SWH system 40sqft; Pool system 400 sqft; BAU: Pool CAGR 5%; other SWH CAGR 21% BAU – Business As Usual; CAGR – Compound Annual Growth Rate High: Pool CAGR 8%; other SWH CAGR 32%


E N E R G Y

Market Overview » U.S. Solar Thermal Market › MŌşŐŝŔŌŗŞ Breakdown

The value of the U.S. SWH market, including material and labor, was approximately $800MM in 2009. ~50% of the total value is material cost, which is dominated by collectors.

Solar Water Heating – U.S. Component Values

11% 3%

9%

10%

16%

51%

Storage Tank

Heat exchanger and

circulator system Sensors & Gauges

Valves

Tubing & Insulation

Collector and

Mounts

2009 SWH Component Market: $400MM

$204MM

$44MM

$12MM

$36MM

$40MM

$64MM

Source: RS Means, Navigant Consulting, Inc. based on data from Energy Information Administration, Solar Thermal and Photovoltaic Collector Manufacturing Activities 2008 and Renewable Energy Annual and Industry Interviews.


E N E R G Y

MŌŝŖŐş OšŐŝšŔŐŢ » GŗŚōŌŗ MŌŝŖŐş › SœŔśŘŐřşŞ

China is the largest market for solar collectors, accounting for approximately 75% of global installations in 2008….

Newly Installed Solar Thermal Collectors in 2008, by Area

Europe, 12%

United States

Turkey

Japan

Australia

Brazil Israel

India Other

China, 75%

Greece

Austria

France

United

Kingdom

Cyprus

Switzerland

Germany,

43%

Other

Source: International Energy Agency Solar Heating and Cooling Programme, Solar Heat Worldwide – Market and Contributions to the Energy Supply 2008, Edition 2010. May, 2010.


E N E R G Y

MŌŝŖŐş OšŐŝšŔŐŢ » GŗŚōŌŗ MŌŝŖŐş › VŌŗŠŐ

….But Europe is the largest SWH market (in terms of revenue) with nearly half of global SWH market value.

2008 World Solar Water Heating Market Value: $12.4 billion

India

Greece Austria

France

United

Kingdom

Cyprus

Switzerland

Germany, 42%

Other

World Market (in millions)

European Market (in millions)

Total = $6 Billion

Europe, 49%

United States

Turkey Japan

Australia

Brazil

Israel

Other

China, 22%

Sources: 1. NCI Analysis 2. International Energy Agency Solar Heating and Cooling Programme, Solar Heat Worldwide – Market and Contributions to the

Energy Supply 2008, Edition 2010. May, 2010. 3. Sensors Report, 2008. http://www.mdpi.org/sensors/papers/s8021252.pdf


E N E R G Y

http://www.mdpi.org/sensors/papers/s8021252.pdf

-Market Overview » High Efficiency Water Heating Systems › GŌŞ Fired

Solar water heating competes with various types of gas-fired water heaters.

Gas Water Heating Options

Conventional Gas Storage Condensing Storage Gas Tankless

AO Smith Vertex

Efficiency Rating

EF Ɓ ĘƱĞ ƽŞşŌřŏŌŝŏǼ EF ƅ ĘƱĞğ (HE)

Efficiency Rating

EF ƅ ĘƱĠĘ Efficiency Rating

EF > 0.82 (standard) EF Ɓ ĘƱġĠ ƽŎŚřŏŐřŞŔřŒǼ

Approximate Installed Cost

$800 to $1,000 (std.) $1,200 to $1,500 (HE)


$2,000 to $3,000 Approximate Installed Cost

$1500 to $3,000 (incl. new venting)


E N E R G Y

Market Overview » High Efficiency Water Heating Systems › EŗŐŎşŝŔŎ Ōřŏ SŚŗŌŝ TœŐŝŘŌŗ

Heat pump water heaters are a promising alternative to solar. Electric Water Heating Options

Conventional Electric Storage Heat Pump Solar Thermal

GE GeoSpring Hybrid Water Heater, AO Smith Voltex

Efficiency Rating

EF ƅ ĘƱġ Efficiency Rating

EF ƅ Ě Efficiency Rating

SF ƅ ĘƱĝ


$600 to $800 Approximate Installed Cost

$2,200 to $3,200 Approximate Installed Cost

$5000 to $10,000


E N E R G Y

Market Overview » Solar Water Heating First Cost Comparison

Solar Water Heating systems are two to three times more expensive than conventional high efficiency options.

0

2,000

4,000

6,000

8,000

10,000

12,000

Residential Gas Fired

Water Heater1

Residential Electric

Resistance Water Heater2

Residential Heat Pump

Water Heater3

Solar Water Heater4

Inst

alle

d C

ost

[$]

Upper Bound

Typical

First Costs of Residential Water Heating Options

1. Source: EIA. Typical is 0.62 Energy Factor and Upper Bound is 0.85 Energy Factor. Both are 40 gallon capacity. 2. Source: EIA. Typical is 0.92 Energy Factor and Upper Bound is 0.95 Energy Factor. Both are 50 gallon capacity. 3. Source: EIA. Typical is 2.0 Energy Factor and Upper Bounds is 2.35 Energy Factor. Both are 50 gallon capacity 4. Solar Water Heating costs from Solar Hot Water Supply Chain Market Analysis, October, 2010. Variations in price due to variations in system architecture. Cost shown is for a 40 gallon tank system before federal or local incentives.


E N E R G Y

Market Overview » What Incremental Costs for Competitiveness?

$500 to $1,000 incremental costs are needed for attractive Solar Water Heating payback periods of 3 to 5 years.

Solar Water Heating Incremental Costs Required by Location and Fuel Type

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

0 5 10 15 20 25

Incr

emen

tal

Co

st [

$201

1]

Simple Pay Back Period

Key

Boston

Chicago

Denver

Los Angeles

Miami

Gas -------

Electric

Current Incremental Costs - Unsubsidized

Current Incremental Costs – Subsidized

SŚŠŝŎŐƳ NŌšŔŒŌřşƲ ĚĘęę ŠŞŔřŒƳ SŤŞşŐŘ śŐŝőŚŝŘŌřŎŐ ŞŔŘŠŗŌşŐŏ ŠŞŔřŒ NREL’Ş SŤŞşŐŘ AŏšŔŞŚŝ MŚŏŐŗ őŚŝ Ō ěĚ ŞŜƱ őşƱ őŗŌş śŗŌşŐ ŎŚŗŗector ŞŤŞşŐŘƴ ŌřřŠŌŗ ŢŌşŐŝ œŐŌşŔřŒ ŏŐŘŌřŏŞ őŝŚŘ EIA’Ş ĚĘĘĝ RŐŞŔŏŐřşŔŌŗ CŚřŞŠŘśşŔŚř SŠŝšŐŤƴ Ōřŏ ŞşŌşŐŢŔŏŐ ŌšŐŝŌŒŐ ŐŗŐŎşŝŔŎ Ōřŏ ŒŌŞ rates from EIA. Federal Investment Tax Credit of 30% and $1,000 in local rebates (minus federal taxes) are the assumed subsidies.


E N E R G Y

Break-even Cost for Residential Solar

Water Heating in the United States.

Solar Water Heating

Roadmap Webinar

Sean Ong

July 28, 2011


Quick Break-even definition

Break-even is when net present benefits = net present

costs.

“You neither save nor lose money”

NATIONAL RENEWABLE ENERGY LABORATORY 2

Key Assumptions

• System: • 40 ft2 collector

• South facing at 26.5 deg.

• 60 gal. solar tank, two-tank glycol active system

• Draw: • 64 gal/day, ASHRAE time profile*

• Water heater set temperature of 120 F

• Simulation and Financial Assumptions: • System Advisor Model (SAM)

• TMY3 Locations used for solar resource

• 20% down payment, 30-yr home equity loan, 5% interest rate.


Fuels used for residential water heating


Break-even maps (electric and natural gas)

Electric Natural Gas

Percentage of U.S. at or above break-even

System cost Electricity Gas

$7000 16% 0.04%

$5000 51% 0.8%

$2500 94% 50%

$1000 100% 95%

5NATIONAL RENEWABLE ENERGY LABORATORY

Break-even Fuel Prices

Electric Natural Gas

• Only slight electricity price increases result in • Substantial NG price increases are needed

a significant portion of the country at break- for SWH systems to reach break-even. Even if

even. NG prices doubled, only 25% of the US would

be at break-even.


Conclusions

• SWH systems need to drop below $2,500 to be competitive with natural gas prices in over 50% of the country.

• Achieving a price point of $1,000/system would allow SWH to be competitive with both electricity and natural gas nearly everywhere.

• Increases in natural gas price – even doubling – are not enough for SWH systems to achieve widespread parity with natural gas. System cost reductions are necessary.


Thank You

Full analysis report can be downloaded at:

http://www.nrel.gov/docs/fy11osti/48986.pdf

Authors:

Hannah Cassard, Paul Denholm, Sean Ong

Contact:

[email protected]

303-384-7451


http://www.nrel.gov/docs/fy11osti/48986.pdf


Analysis Assumptions


Break-even breakdown


Break-even breakdown

-1000 0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 11000 12000 13000 14000 15000

WA

NE

ND

SD

WY

CA So

IA

IN

CA No

MS

OK

NV

DC

TN

WI

NH

MN

KS

VA

MI

NJ

ID

MA

KY

TX

MO

ME

OR

AL

IL

NM

RI

UT

MT

FL

AR

WV

NY

NC

MD

PA

CO

CT

AZ

OH

SC

GA

DE

LA

VT

HI

Breakeven SWH Cost ($/system) - Gas

Gas Rate

Federal Tax Credit

Tax Deductible Interest

Local Incentives


Fuel Price Assumptions

1. Utility fuel price data for 2008 from the EIA (flat rate only)

2. Assumed real-price escalation of 0.5% per year for both electric and gas fuel prices

3. Fixed charge adjustment of 6% for electricity, 2% for natural gas (removes fixed charges from fuel price)

4. Base case scenario utilizes fuel price and solar resource location of the largest utility in each state


System Parameter Assumptions

1. Utilize default SAM solar water heating system (two-tank glycol w/ aux elec.) parameters for base case: 1. Collector Tilt: 26.5 deg

2. Collector Azimuth: 360 deg (south)

3. Collector Area: 40 sf

4. Storage Volume: 60 gal

5. Water Heater Set Temp: 48.89 deg C

6. FRta = 0.77, FRUL = 4.5 W/m2-C, IAM = 0.1, HX eff = 0.5

2. System degradation of 0.5% per year

3. Water heater energy factor for electricity of 90%, natural gas of 60%

4. Natural gas burn efficiency of 80%

5. TMY sites paired with electric utilities based on population center of the service territory

6. Assume auxiliary system uses the same fuel as the current conventional system


Usage Assumptions

1. Single-family house

2. Utilize default SAM load profile for all locations

3. Favorable roof angle and orientation, not shaded


Financing Assumptions

1. Federal tax bracket: 28%

2. Home-equity type loan, interest rate: 5%

3. Loan period: 30 years

4. Discount rate: 5%

5. Evaluation period: 30 years

6. Down-payment: 20%

7. Federal ITC: 30%

8. All state, local, and utility incentives from the DSIRE database included for each state

9. O&M of $1000 at year 10 and year 20 for tank and heat exchange fluid replacement


StateElectric Price

(cents/kWh)

State-Wide

Incentives

Annual Value of

Energy Saved ($)

Base SWH Cost

($/system)

Base Annual

Average Solar

Fraction (%)

HI 27.3 $2,850 $539 $15,680 0.65

NY 22.9 $1,500 $436 $11,540 0.61

CT 18.0 $1,765 $335 $9,080 0.53

CO 9.7 $3,000 $237 $7,685 0.71

CA So 14.0 $0 $311 $6,675 0.80

TX 12.4 $0 $287 $6,030 0.85

CA No 12.4 $0 $277 $5,765 0.74

FL 10.9 $500 $209 $4,425 0.86

NE 7.6 $0 $148 $2,290 0.58

MO 6.6 $500 $127 $2,240 0.62

WA 8.9 $0 $145 $2,220 0.50

Examples – Electric Break-Even

Break-even value is influenced by electric prices, local incentives, and available solar resource


-1000

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

11000

12000

13000

14000

15000

HI NY CT DE RI VT CO MD PA MA NJ LA CA So

OH ME TX MT GA NH CA No

SC IL UT NV WI

Bre

ak-e

ven

SW

H C

ost

($

/Sys

tem

)

Top 25 States

Breakeven SWH Cost - Electric

O&M Cost

Local Incentives


Federal Tax Credit

Electric Rate

Components of Break-Even Cost - Elec


-1000

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

11000

12000

13000

14000

15000

NM AZ MN MI AR DC FL OR NC AL MS ID WV VA SD WY IA OK IN ND KS TN KY NE MO WA

Bre

ak-e

ven

SW

H C

ost

($

/Sys

tem

)

Bottom 25 States

Break-even SWH Cost - Electric

O&M Cost

Local Incentives


Federal Tax Credit

Electric Rate

Components of Break-Even Cost - Elec


StateNatural Gas

Price ($/therm)

State-Wide

Incentives

Annual Value of

Energy Saved ($)

Base SWH Cost

($/system)

Base Annual

Average Solar

Fraction (%)

HI $4.36 $2,850 $310 $9,505 0.63

VT $2.01 $3,000 $135 $4,935 0.51

LA $1.78 $3,000 $128 $4,765 0.74

CO $1.10 $3,000 $97 $3,920 0.70

FL $2.10 $500 $162 $3,175 0.86

TX $1.54 $0 $152 $2,400 0.95

CA No $1.36 $0 $118 $1,490 0.77

CA So $1.27 $0 $110 $1,285 0.82

ND $1.26 $0 $90 $735 0.55

NE $1.27 $0 $90 $720 0.58

WA $1.32 $0 $77 $390 0.49

Examples – Gas Break-Even

Break-even value is influenced by natural gas prices, local incentives, and available solar resource


-1000

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

11000

12000

13000

14000

15000

HI VT LA DE GA OH CO SC AZ CT UT PA MD NC MT WV NY OR AR RI FL IL ID MI ME

Bre

ak-e

ven

SW

H C

ost

($

/Sys

tem

)

Top 25 States

Breakeven SWH Cost - Gas

O&M Cost

Local Incentives


Federal Tax Credit

Gas Rate

Components of Break-Even Cost - Gas


-1000

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

11000

12000

13000

14000

15000

NM NJ MA KY AL MO MN TX WI NH VA KS DC TN NV OK MS CA No

IN WY IA CA So

SD ND NE WA

Bre

ak-e

ven

SW

H C

ost

($

/Sys

tem

)

Bottom 25 States

Breakeven SWH Cost - Gas

O&M Cost

Local Incentives


Federal Tax Credit

Gas Rate

Components of Break-Even Cost - Gas


Examples – Negative Break-Even Gas

StateGas Price

($/therm)

Annual

Value of Gas

Savings ($)

O&M in

year 10 and

year 20 ($)

NPB of Gas

Savings ($)

NPC of O&M

and downpay.

($)

Net

Present

Value ($)

OH $1.73 $105.18 $1,000 $1,613 $1,991 -$378

CO $1.10 $96.91 $1,000 $1,486 $1,991 -$505

MT $1.38 $105.31 $1,000 $1,615 $1,991 -$376

UT $0.93 $74.89 $1,000 $1,148 $1,991 -$843

IL $1.37 $91.66 $1,000 $1,405 $1,991 -$585

OR $1.37 $82.06 $1,000 $1,258 $1,991 -$733

States with low natural gas prices or low energy savings have a negative net present value before incentives. The cost of operating the system is greater than the value of

the gas savings.


Table of Contents

2 Examples from Other Markets

1 Market Overview


E N E R G Y

Examples from Other SHW Markets » Overview

U.S. SWH systems are much more expensive than Israeli or Chinese systems, driven by different system types, specifications, quality, installation factors, and market volume.

Characteristics United States Israel China

Typical Installed Cost (domestic, 2-4 people)

$5,000-10,000 $1,000-1,800 $300-1,000

Most Common Technology

Indirect (with pump)

Thermosiphon (no pump)

Thermosiphon (no pump)

Tank Capacity 80 gal ~30 gal 30-50 gal

Collector Sizes ~50 sqft total ~20 sqft total ~20 sqft total

Backup System Conventional electric/gas Electric heating element Electric heating element

Quality Highest. SRCC certified High. Some are SRCC certified

Low. Many not certified Shorter system life.

Typical Installation Collectors on pitched roof. Indoor tank. Complex design. Building not designed for SWH. Limited SWH experience. High labor costs.

Collectors and tank on flat roof. Simple system. Building designed for SWH. Experienced installers. Medium labor costs.

Collectors and tank on the roof (some flat, some pitched). Simple system. Experienced installers. Low labor costs.

Market Volume 30,000 installs/year 70,000 installs/year 6,000,000 installs/year

Sources: Israel: Amcor, Pro, Tovtoda. China: Changzhou Erjin Solar Energy Equipment Co., Zhejiang Shentai Solar Energy Co., Changzhou He Jia Solar Energy Co.,China Verysolar Technology Co.,Haining Oupairineng Solar Water Heater Co., Beijing Sunpu Solar, Linuo Ritter International (China-Germany JV), Tecco Group. U.S.: Butler Sun Solutions, A.O. Smith, Caleffi, Solahart, Solene/ Chromagen, Alternate Energy Technologies, Fafco, Silicon Solar, SunEarth, Inc., TCT Solar. U.S. costs confirmed against California Solar Initiative. All: IEA Solar Heat Worldwide 2010. CSI-Thermal Program reported costs and HECO: 2007, Ron Richmond.


E N E R G Y

Examples from Other SHW Markets» Price Comparison by System Type

Across all technology types, U.S. SWH systems are significantly more expensive than similar systems in China and Israel.

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

$7.0

$8.0

Direct* Thermosiphon Indirect

Th

ou

san

d U

SD

Technology Type

China

US

Israel

SWH Typical Installed System Price

Incentives not included in system costs.

• Thermosiphon is the most common configuration in Israel and China.

• Continental U.S. typically uses indirect and direct systems.

• Thermosiphon system is used in Hawaii, where freezing is not a concern.

• Thermosiphon is the least expensive SWH system configuration, but even U.S. thermosiphon systems are far more expensive that Chinese or Israeli units.

Sources: Israel: Amcor, Pro, Tovtoda. China: Changzhou Erjin Solar Energy Equipment Co., Zhejiang Shentai Solar Energy Co., Changzhou He Jia Solar Energy Co.,China Verysolar Technology Co.,Haining Oupairineng Solar Water Heater Co., Beijing Sunpu Solar, Linuo Ritter International (China-Germany JV), Tecco Group. U.S.: Butler Sun Solutions, A.O. Smith, Caleffi, Solahart, Solene/ Chromagen, Alternate Energy Technologies, Fafco, Silicon Solar, SunEarth, Inc., TCT Solar, Solar Water Heating Supply Chain Market Analysis for the City of Milwaukee, Navigant Consulting 2010. U.S. costs confirmed against California Solar Initiative CSI-Thermal Program reported costs and HECO: 2007, Ron Richmond. *Direct systems are uncommon in China and Israel.


E N E R G Y

Examples from Other SHW Markets» Detailed Price Comparison for Typical U.S./Israeli Systems

A detailed cost comparison of U.S. and Israeli systems reveals many design differences, which impact both material and installation costs.

Elements of Total Installed Cost of Typical U.S. and Israeli Systems

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

$7.0

$8.0

US

D T

ho

usa

nd

s

Israel Thermosiphon

(Most Common)

U.S. Thermosiphon Israel Indirect U.S. Indirect (Most

Common)

Pressurized Tank*

Building Not SWH-Ready

Indoor Tank Installation

Pitched Roof Installation

Lower Collector Mfg Volume

Larger Collectors*

Conventional Backup*

Larger Tank*

Other U.S. Cost Elements

Base Cost

Israeli Prices

Incentives not included in system costs.

Other U.S. Cost Elements: Higher quality/more features, less installation experience, higher labor rates, less installer competition, higher installer overhead/marketing costs, and higher installation costs associated with the asterisked material costs in the bar chart. Sources: Israel: Amcor, Pro, Tovtoda. China: Changzhou Erjin Solar Energy Equipment Co., Zhejiang Shentai Solar Energy Co., Changzhou He Jia Solar Energy Co.,China Verysolar Technology Co.,Haining Oupairineng Solar Water Heater Co., Beijing Sunpu Solar, Linuo Ritter International (China-Germany JV), Tecco Group. U.S.: Butler Sun Solutions, A.O. Smith, Caleffi, Solahart, Solene/ Chromagen, Alternate Energy Technologies, Fafco, Silicon Solar, SunEarth, Inc., TCT Solar, Solar Water Heating Supply Chain Market Analysis for the City of Milwaukee, Navigant Consulting 2010. U.S. costs confirmed against California Solar Initiative. CSI-Thermal Program reported costs and HECO: 2007, Ron Richmond. All: IEA Solar Heat Worldwide 2010.


E N E R G Y

Examples from Other SHW Markets» Policy Impact on Price

SWH policies vary across countries and greatly impact actual installed system prices, but US direct financial incentives are the most generous.

U.S.

• The federal government offers a 30% investment tax credit on SWH systems.

• State and utility rebates vary from $500/system (Snohomish County PUD No 1 - Solar Express Rebate Program) to a maximum of $5,000/system (Pennsylvania Sunshine Solar Rebate Program).

• Additionally, the state of Hawaii benefits from state, local, and utility rebates that can reduce the average installed cost by over 2/3.

•The State of Hawaii also mandates that all new homes are built with SWH systems.

Israel

• SWH systems were mandated in new construction of residential buildings after 1980. A number of pre-1980’s buildings also have SWH installations.

China

• Under the national “Getting Household Appliances into the Countryside” initiative, up to 13% of system costs can be subsidized for rural customers (up to ~$80 USD).

• Local programs, such as the one in Beijing, have invested up to $30M for SWH subsidies (~$10/system).

• Golden Sun Certification is not mandatory to manufacture or sell SWH in China, leading to variance in product quality. As of March 2011, only 30 of ~40,000 SWH manufacturers have earned this certification.

Source: HECO, U.S. Department of Energy, Israeli Department of Science and Technology, China Golden Sun Program, DSIRE Solar Incentive Database


E N E R G Y

Examples from Other SHW Markets» Conclusions

Many factors contribute to the higher cost of U.S. SHW systems relative to Israel and China, but there are many misperceptions about their impact.

Cost Factor Impact Explanation for Higher U.S. Costs

Technology Choice High The indirect system, which is the most common U.S. system type, is more expensive than the thermosiphon system, which is the dominant configuration in China and Israel.

Design High More complex systems with higher quality materials and additional features drive higher material and installation costs.

Building SWH Preparation

High Buildings in Israel are designed to be SWH-ready, significantly reducing labor and material installation costs.

Installer Costs High Inexperience, higher overhead/marketing, less standardization, and less competition contribute to higher installation cost.

System Capacity Medium U.S. systems use double the collector area and storage tank capacity to meet U.S. hot water capacity expectations

Labor Rates Medium/

Low Higher labor rates increase installation costs, but they have a relatively small impact on total costs relative to Israel.

Quality Medium/

Low Chinese system quality is inferior but Israeli systems are certified to US and European standards.

Manufacturing Volume

Medium/ Low

Lower U.S. manufacturing volumes relative to both countries has a modest impact on total cost, as it impacts primarily collector costs, and Israeli market is not so large.

Pressure Requirements

Low U.S. end-users expect hot water at a high and steady pressure, necessitating pressurized systems, but expectations are less stringent in China and Israel.

Incentives/Rebates N/A U.S. incentives are far more generous than those in China and Israel.


E N E R G Y


Cold-Climate Solar Water Heaters:

Pathways to Cost Reduction

Low-cost Solar Water

Heater Roadmap Webinar

Jay Burch

July 28, 2011


Presentation outline

• Solar water heater costs• Cost goals and system characteristics goals

• Potential pathways to low cost• General strategies

• Polymer components

• Evacuated tube collectors

• Hybrid approaches

• Conclusions• Practical pathways exist for significant cost reduction

2


Cost goals

• Installed cost goal range: ~$1K - $3K

– Makes SWHs competitive with natural gas and HPWHs

• Current SWH cost range: ~$5K - $10K

– Significant cost reduction needed: 2X to 4X

– Current technology is mature significant reductions unlikely

3

Challenging!!


Cost categories

Total SWH cost = First cost + Maintenance cost

• First Cost = hard costs + soft costs

– Hard costs: inherent, unavoidable costs• Hardware, Installation: (~$3K-$5K today); addressable through R&D

– Soft costs: external, potentially avoidable costs• Marketing; permits, inspections, paperwork:(~$2K -$5K today);

• Not addressed here, but need to be lowered drastically

– Interactions lowering first cost• Low-cost systems easier to market lowered market cost

• Lowered-weight /volume lowered installation cost + more-efficient market channels

• Maintenance Cost: inherent, depend on design (0.3% – 3% of hardware cost/yr)

4


Other relevant low-cost SWH goals

• High energy savings:Maintain savings at current levels, ~ 60% solar fraction (SEF ~ 2.2)

• High reliability:Minimal maintenance; no degradation/failures from stagnation or freeze

• Good aesthetics:Mount collector flush, no visible tank

• Lifetime: marketing question10-20 years (vs. current systems 10 - 50 years, f(maintenance) )

• Low weight and volumeEnables “on-the-plumber’s truck” and big-box market channels

5


General cost reduction strategies

• Substitute less-expensive components• Collectors, pipes, tanks, valves

• Eliminate components: simplify system• Reduced part count increased reliability

• Example: cold-climate thermosiphon system

• Re-think the system• Hybrids: combine technologies?

6


Specific examples

7

• Polymers:Component substitution: glycol system

Part elimination: thin-film thermosiphon

• Dewar-type evacuated tubes:Component substitution: Double-wall evacuated tube collectors

• Hybrid systems:System re-thinking: solar-assisted heat pump


Polymer path: glycol system example

8

[COSE = (Cost)/(Savings)]

Film-lined storage

Cost & Cost-of-Savings/ Glycol

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

Base case

One pump

Polymer tank + hx

Integrated piping

Valve package

Non-selective m

tl-gls

Polymer selectiv

e

Polymer non-selectiv

e

Polymer unglazed

Fir

st

Co

st

4

6

8

10

12

CO

SE

[c/k

Wh

]

1st Cost

COSE

BOS Variations Collector Variations

Polymer Collector

Heat exchanger

Retainer ring

Submersible pump

Polymer film liner

Insulation

Sheet metal cylinder

Rigid foam base

Heat exchanger

Retainer ring

Submersible pump

Polymer film liner

Insulation

Sheet metal cylinder

Rigid foam base

Cost ~$12

Polymer heat exch.

Integrated valve

pkgIntegrated PEX piping

Eliminate tank pump

valve package

2003 cost study


Thermosiphons: an inherently lower-cost system

9

Advantages Disadvantages Ameliorating the

disadvantages Lower cost (no circulation hardware, ~$250)

Roof weight (~ 500 lbs)

Place storage at roof peak (lowers moment, need to re-inforce)

More reliable, simpler (no pump, controller, sensors to fail)

Pipe freeze (potable water piping in attic)

Use pipe freeze protection/PEX (PEX will not burst on freeze: fail-safe)

Maintains high performance (~96% of a glycol system)

Aesthetics (bulbous tank visible on roof, typ.)

Place storage out of sight (place inside attic at peak,...)

Collector

Tank

Pipes


Polymer path2: Seam-welded thin film thermosiphon

10

Seam weld pattern

Storage (hx not shown)Collector

High-speed roll-to-roll

fabrication possible

Furnished by RhoTec; patented


Prototype test units

11

Healdsburg

Phoenix

San Francisco

Furnished by RhoTec


Dewar-type evacuated tube collectors/systems

12

Evacuated tubes are an elegant combination of low-cost tube manufacturing

with high-tech solar coatings, combining low cost and high performance.

2-wall dewar design,

w/ thermosiphon hxEvacuated space

Cold water In

Hot water out

Glass tube

Selective coating

Cold in

Hot out

Double-wall tube

Tube cross-section Tube-in-tank side view

< $5/ft2-absorber


Evacuated Tube Thermosiphons

13

Porcupine-style thermosiphon: unsuitable

for the U.S. residential market (poor

aesthetics and no pipe freeze protection)

Evacuated

tube

collectorStorage tank

Mixing

valve

Capillary tube

limiting flow

Cold

inHot

out

PEX piping

Remote-coupled thermosiphon: suitable for

the U.S. residential market, with a freeze

protection approach indicated


Hybrid Systems: Solar-assisted heat pump

14

Tank

Collector

Condenser

Compressor

Evaporator

Heat to

evaporator

Heat pump

water heater

No solar storage;

both heat pump and

collector run all day

Air or liquid collector

and heat exchanger

~Expected COP with solar

~75% COP increase at

operating point

8

1C

OP

60 120T_tank_hx [F]


Support for industry-driven SWH R&D

DOE-funded support provided via:

• National labs (NREL, Sandia)

• Universities (Minnesota, others)

• A&E firms

Materials selection and testingComponent/system modeling

Component/system testing

UV-weathering capabilities, NRELCollector/system test stand, NREL


Conclusions

• Practical low-cost SWH designs exist that reach cost goals• Component substitutions; system simplification; re-design

• Small R&D investment/speed to market in some paths (engineering

only)

• Soft costs must be considered to reach goals

• Key technical challenges:• If new materials used long-term durability testing

• Low-cost heat exchangers for unpressurized tanks

• If films chosen identify/develop long-lived glazing/absorber films

• Overheat/freeze protection: choose options, optimize, verify

16


End of Webinar Pathways Discussion

Please submit comments and questions

Additional slides follow in Appendix as background information

17


System Metrics Used

Annual system efficiency (ηann):• ηann = Qsaved/Qincident

Qsaved = Qann,aux, no solar – Qann, aux, with solar

Qincident = Acollector *Hsun,year,coll

Levelized cost of saved energy (Csav):• Csav = (Total cost)/(Total savings)

Total cost = (Total first cost) + (PresentValue of O&M cost)

Total discounted savings = PresentWorthFactor*Qsaved ,ann

Simple payback (SP):• SP = ($first cost)/($saved/year)

$first cost = Hardware + Install + Soft Costs

$saved/year = $energy*Qsaved,ann/ηconv

18


Account for performance reductions

19

Glycol Solar System

15%

25%

35%

45%

0 10 20 30

Annual Average Temperature (Co)

Eff

icie

nc

y

Selective

Nonselective

Polymer

Unglazed

Annual efficiency is ~ constantfor a given system and draw volume

Annual efficiency varies from ~38% (best collector) to ~22% (unglazed)for 40 ft2/60 gal system with 64 gal/day draw


Schematic Glycol System

20

Indirect two-tank system

w/ Immersed heat exchanger

Most common retrofit system


Thermosiphon vs. Active: Much simpler

Inside Solar tank

Elec. tank

Cold In

Hot Out

Solar tank

Thermosiphon Active

Extra hardware vs. thermosiphon

Cold In

Hot Out

Tank sensor

Wires

AC Power

Controller

Pump

Collector sensor

Thermosiphons:• Fewer parts, less cost

• More reliable

• ~Equal performance with active

• No interior space needed for solar tank


Hybrid Systems: PV Thermal

22

Ambient air in

Water

heater

Air-to-liquid hx

PV panels below

Air collectors above

Vents to hx

Ambient air in

Fan

Pump

Solar water heating can

be added to a PV

system inexpensively

Echo-first system

Summary and Next Steps

Webinar Summary

– Presented need for solar water heating innovation that results in

large scale market penetration.

– Reviewed foreign markets and how they compare to the U.S.

market.

– Gave examples of possible pathways to low-cost systems.

Next Steps

– Gather input.

– Develop roadmap to provide guidance for low-cost solar water

heating research going forward.

• First draft of roadmap will be released for open peer review in August.

• Final roadmap submitted to DOE in September.

–NREL’s long term goal is to work with industry to facilitate cost-effective solar water heating solutions with the potential for

significant market penetration.


Conclusion

Thank you for attending the Low-Cost Solar Water Heating Webinar!

Please send additional comments and questions to Kate Hudon at [email protected].

Regular updates and background materials will be posted on: https://sites.google.com/site/solarhotwaterinnovation/



https://sites.google.com/site/solarhotwaterinnovation/


Question and Answer Session

Questions will be submitted electronically and

answers will be provided verbally

To submit a question, select Q&A on the top bar, click in the top box, type your question, click Ask

For a copy of today’s slides, visit http://www.buildings.energy.gov/webinars.html.






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If you have any additional questions for our presenters, please email Kate Hudon at [email protected].

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