Reasons to switch
Installing a solar hot water system is one of the most efficient and cost effectiveinitiatives a householder can undertake to make an existing home more sustainable.
The Australian Greenhouse Office is offering households a $1600 rebate to reduce thecost of a solar hot water system providing:
1. They are changing from an electric storage hot water system (which are the mostemissions intensive); and
2. Their combined family taxable income is less than $100,000 a yearThe rebate applies to an existing principal place of residence and is available to bothhomeowners and renters.
The average savings in CO2 emissions per year as a result of switching to solar from anelectric storage hot water system is two to four tonnes.
The average savings in electricity costs is between $300 and $700 per year depending onthe 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 smallpercentage are solar.
Even though electric hot water systems have a lower upfront cost, the long term benefitsof a solar system will outweigh the initial outlay. A household may have to replace twoelectric systems over the life of one solar system and there are lower yearly electricitycosts with a solar system.
As well as the $1600 rebate from the Australian Greenhouse Office, there are furtherincentives to install a solar hot water system when an electric storage system is ready to be replaced.
Nearly all solar systems on the market come with a certain number of Renewable EnergyCertificates (RECs). RECs are assigned by the Office of the Renewable Energy Regulatoras part of the Mandatory Renewable Energy Target. The certificates are tradable and canbe 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 with20 to 40 RECS
that equates to an extra discount of $600 to $1200 on top of the $1600 dollar rebate.
Because switching from an electric storage hot water system to a solar hot water systemis the simplest and most effective single measure to make a house more greenhousefriendly, most state and territory governments have their own incentives to encouragehouseholds to install a solar hot water system. In NSW, for example, switching to solarhot water attracts a rebate in the order of $600 to $800 depending on the type of systemchosen.
Why switch? - A real life example from Sydney
Replacement of an existing electric storage hot water system:
Costs
Retail cost of a new solar hot water system: 250 litre tank (suitable for a three tofour person household): $3928
Installation cost: $1400
Total: $5328
Offset by Rebates and RECS
Australian Greenhouse Office rebate: $1600
NSW Government rebate: $600,
Value of RECs attached to the system (bought back by the retailer in the form ofan upfront discount): $728
Net Cost: $ 3000
Electricity saved over the life of the system ($400 a year for 13 years): $5200
Net benefit to owner is $2200 over the lifetime of the system
Any future increases in the cost of electricity will only increase the benefits!
Appendix One
FACT SHEET $1,000 SOLAR HOT WATER REBATE
What is the Solar Hot Water Rebate?
A $1,000 rebate for installing a solar and heat pump hot water system in existing eligible homes.
What will it achieve?
Rebates will be available for up to 225,000 households over five years - resulting in significantgreenhouse gas savings for the nation while providing long-term financial benefits forhouseholds. Typically, each system will reduce annual greenhouse emissions by two to fourtonnes and will save households $300 - $700 off their annual electricity costs.
How much will it cost?
The programme will cost $252.2million over five years.
Eligibility requirements
To be eligible to obtain a rebate, the hot water system must:
Replace an existing electric storage hot water system;
Be a solar or heat pump hot water system that is eligible for at least 20 RECs under theMandatory Renewable Energy Target;
Be purchased and installed on, or after 18 July 2007;
Have at least a five year warranty;
Be installed at a principal place of residence
Applicants must be an individual over the age of 18 and with a taxable family income of less than $100,000 in the most recent financial year.
For rental properties either the tenant or the owner may apply.
Rebates will not be eligible where:
The dwelling is a new construction;
The dwelling is a holiday home or other temporary dwelling;
The applicant is not an individual, for example rebates will not be given to businesses;
The dwelling is State or Territory public housing or is owned by a State or Territorygovernment;
The system replaces any type of gas hot water system;
The system replaces or is additional to an existing solar or heat pump hot water system;
The system will be used for non-domestic purposes or for heating a pool, spa or similar.
Do other rebates still apply?
The rebate is in addition to any other rebates from State or Territory governments or otherorganisations.
More information
Full details of the rebate programme and the application form is available from
www.greenhouse.gov.au/rebates or call the Information Line on 1800 808 571
Net benefit to owner is $2200 over the lifetime of the system
The numbers of RECs that come with a solar hot water system depend on its size andsystem and SAVE $1000s
