Gas – boosting solar hot water

The installation of solar and gas-boosted solar hot water systems is being championed by government and industry as a way to reduce greenhouse gas emissions in the residential sector. The Australian Government and several state governments have introduced rebates to encourage their uptake. Lyndsie Mewett reports.

Water heating accounts for approximately 30 per cent of an average household’s total energy use. Using solar energy to heat water can greatly reduce a household’s carbon footprint because no greenhouse gas emissions are produced. When sunlight is insufficient a gas or solid fuel booster is used to heat the household water.

Gas-boosters use a natural gas burner to heat water either in the storage tank or as a separate unit downstream from the storage tank. Gas-boosted systems produce less greenhouse gas emissions than electric-boosted systems, and as such, are included in the federal and state governments’ solar hot water rebate schemes.

The federal scheme

From 26 February 2009, the Australian Government is providing a rebate of $1,600 to eligible home-owners that replace existing electric hot water systems in existing homes with solar and heat pump hot water systems.

To be eligible for the rebate, a hot water system must replace an electric storage hot water system; be a solar or heat pump hot water system that is eligible for at least 20 Renewable Energy Certificates (RECs); and, must be installed by a suitably qualified person.

State-based schemes

Around the country, state-based schemes offer residents rebates on gas-boosted solar water heaters, ranging from $200 to $700.

Victoria: A point-of-sale discount on the supply and installation cost of gas-boosted solar hot water systems is offered. An additional $200 rebate is offered to those in regional Victoria who are connecting to gas for the first time in a gas reticulated area. Sustainability Victoria says this rebate is to “assist you to switch from electric water heating to greenhouse friendly gas-boosted solar”.

New South Wales: A rebate is available when households replace an existing electric hot water system with a solar hot water system before 30 June 2009. The state is offering a rebate of $300 for a gas hot water system with a five star or higher energy rating.

South Australia: Water heaters installed into most homes in the state will need to be low emission types such as high efficiency gas or gas-boosted solar. In order to help low income households comply with the new performance standards a rebate of $500 on the cost of a new minimum
18 REC water heater is available.

Tasmania: Hobart City Council is offering ratepayers a $500 incentive to install a gas-boosted solar hot water system.

Western Australia: Rebates are offered to households who install environmentally friendly, two or more panel gas-boosted solar water heaters. Rebates of $500 are available for natural gas-boosted solar water heaters, while $700 rebates are available for LPG-boosted solar water heaters used in areas without reticulated gas.

Australian Capital Territory: A rebate of up to $500 is provided to households for the installation of five star gas or solar hot water services that replace electric hot water services.

Queensland: No state government rebate scheme is offered, however installations of gas-boosted solar hot water systems in the state may still attract Australian Government RECs.

A boosted gas industry

Manufacturers and retailers of hot water systems have said that the uptake of gas-boosted solar hot water systems has increased over the last year, attributing increased sales to the federal and state government incentives and an increased level of awareness of environmental issues by consumers, plumbers, builders and retailers alike.

According to Hills Solar, the renewable energy hot water market has grown considerably over the last twelve months, moving from 7 per cent to almost
10 per cent of the total hot water market nationally. “One of the supporting factors is federal and state regulation, which aims to increase the uptake of renewable energy hot water products and high efficiency gas in both new homes and existing homes,” Product Manager Dominic Beshara says.

Rinnai Marketing Communications Manager Mike Officer says the company’s sales of gas-boosted solar hot water systems has increased by well over 100 per cent since 2007 due to the introduction of building regulations requiring ‘greenhouse friendly’ water heater systems along with the federal and state government rebates.

Further regulation of the industry looks set to continue reducing the installation of electric storage systems, says Steve Linton from Dux Hot Water.

“There are proposed federal electric storage bans for 2012, and even earlier in some states, which means that solar and heat pump systems will become mandatory in a lot of installations. For areas with access to natural gas it looks as though there will still be the option of installing a five star or greater rated product,” he says.

The positive impact of governments’ solar hot water rebates is also being felt in the gas distribution industry.

Jemena Manager of Gas Networks Development Peter Harcus says “We’re seeing the take up of gas in housing estates in New South Wales is almost 100 per cent of all new dwellings built. If gas is available they connect to it. And there is a large proportion utilising natural gas for hot water systems, either straight natural gas systems or gas-boosted solar systems.” 

An Envestra spokesperson also notes this trend in Victoria. “The Victorian Government requires the installation of a rainwater tank or a solar hot water system in all new dwellings where gas is
available. Where the solar option is selected, units must be gas-boosted. These initiatives are clear recognition of the environmental benefits of natural gas.”

Issues to be addressed

While acknowledging the Australian and state governments’ efforts to lower greenhouse gas emissions through incentives to take up gas–boosted solar hot water systems, industry sees several improvements to be made in regard to the different rebates available.

“Currently there are different regulations and incentives within each state and nationally, which is confusing for consumers,” says Mr Beshara.

“This needs to be simplified and streamlined without being means tested to ensure ease of understanding for the consumers.”

Others in the industry say there is a need for the inclusion of incentives for solar retrofit works to hot water systems.

Alan Black of Solar Mio says “The current requirement forcing home owners to replace their existing hot water storage tank to receive a subsidy fails to take into account the additional unnecessary carbon footprint created by insisting that home owners discard their existing working hot water service in order to gain a rebate. As an average retrofit will in practice give the same solar gain as an equivalent new system, this requirement cannot be justified.” 

Mr Officer says that the uptake rates of gas-boosted solar hot water heaters could be further increased if the government provided aid to households to increase the size of gas piping on properties.

“A lot of older homes have ½ inch gas piping. Most gas-boosters require ¾ inch piping and upgrading is high cost and sometimes a barrier to proceeding.”

Ecosmart Hot Water Business Development Manager Alan de Soza agrees. “The change from standard gas to gas-boosted solar is inhibited by the need to often increase the supply capacity of the natural gas service as a gas-boosted solar heater requires a larger volume of gas to operate correctly.”

From a gas network perspective, Mr Harcus says that an increased uptake of gas-boosted solar hot water systems over gas hot water systems means that the annual consumption of gas for households will drop and gas network companies will have to work to ensure a sustainable revenue flow from new homes.

“If only solar hot water systems were connected to the network, the economic justification to reticulate new housing estates would be far more difficult. So we need to be able to provide applications into homes such as cooking and heating to supplement the fall in hot water system,” he says.

The way forward with gas–boosted solar

A number of industry representatives have stated that an increase in gas-boosted solar hot water system installation has great potential to reduce household greenhouse gas emissions.

LPG Australia has said that if gas-boosted solar hot water systems replaced all electric hot water systems, greenhouse gas savings would be reduced by over
95 per cent for households. Each household would equate to 0.2 tonnes per year, compared to emitting 4.2 tonnes per year with electric storage heating.

“Of Australia’s 8.2 million dwellings, 3.8 million have electric hot water systems. There is potential for massive savings in this one strategy alone,” says LPG Australia Industry Development Manager Phil Westlake.

Mr de Soza says “Gas-boosted solar hot water is the most efficient system available on the market. For a customer with reticulated gas on their property who currently has a standard electric hot water service the change to gas-boosted solar hot water is both environmentally and economically sound.”

Overall, the gas industry is in support of the Australian and state government gas-boosted solar hot water rebate schemes and is looking forward to the development of a consistent framework and further policies to increase the use of gas in the residential sector.

What is an REC?

An REC refers to a market-based certificate trading scheme currently created through the Mandatory Renewable Energy Target (MRET). Each REC represents the equivalent of one megawatt hour (MWh) of electricity generation from an accredited renewable energy source.

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