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Solar Power

When people say "solar power," they often mean solar photovoltaic (PV) technology, which produces electricity. The other large category of solar energy for buildings is solar thermal water heating, often called just "solar thermal." 

Trying to decide whether it makes sense to invest in solar PV or solar thermal? There are numerous calculators developed by state and federal agencies to help you determine whether an investment in solar power makes sense for you. 

Solar PV for electricity

Solar PV is a well-understood, proven technology that has been used for decades to provide electricity to homes and businesses. Solar PV panels can last 20+ years, and are reliable in a range of climate zones. Most residential and commercial systems are "grid-tie," meaning they connect to the electrical grid through the building. This allows the solar PV panels to send any unused electricity back into the grid, offsetting energy costs for the customer. 

Typical system sizes and costs can vary dramatically based on the electricity needs of the building. One point of reference:  Most single-family homes in California use systems of 5 kW - 8 kW, and current prices are around $6.50/Watt (or, $6,500/kW). You can see current statewide trends in pricing

For more background on how solar PV works and how to estimate the necessary size, see the Go Solar site on how solar PV works.

Current rebates and incentives for solar PV:

California Solar Initiative
  • Incentives of $0.20/Watt or $0.025/kWh for residential and commercial customers, depending on which rebate type
  • For low-income residential customers, incentives of $4.75/Watt - $7.00/Watt through SASH program
Federal solar investment tax credit

Solar thermal for hot water

Solar thermal technology is often mistaken for solar PV, since the thermal collectors are also mounted on building roofs and can look similar to PV panels. But solar thermal systems are designed to capture the thermal heat of the sun to heat water. Preheating the water in this way allows the building's hot water heater to operate less frequently, saving significant energy. 

Solar thermal systems are also very durable, proven technology, with typical lifetimes of 20+ years. They are usually much less expensive than solar PV, but their cost-effectiveness depends on the type of energy (gas, electricity, or propane) used by the hot water heater. Due to current low prices for natural gas, the payback period for buildings with a natural gas heater will be much longer than for a building that heats water using electricity or propane. 

Download a brochure describing how solar thermal works (pdf, 3 MB).

Current rebates and incentives for solar thermal:

California Solar Initiative

Federal solar investment tax credit