Progress Energy customers saved an average of $235 a year by switching to solar thermal water heater, representing an average annual savings of 63 percent on the water heater portion of their power bill. 
Those are the results Raleigh-based Progress reported this week to the N.C. Utilities Commission to wrap up a pilot project using 150 customers to test the efficiency of solar thermal water heaters. As part of the year-long pilot, Progress contributed $1,000 toward each customer's cost of buying as solar thermal water heater.
The company says that more than 15 percent of electricity used in a typical home is used for heating water. Solar water heaters use the sun as their primary source of energy, with electricity (or natural gas) as a backup.
Solar water heaters are known for their high efficiency performance as well as their high price tags, costing about 10 times to 20 times as much as a conventional water heater. Progress reported that buying and installing the solar water heaters averaged $7,271 per household, ranging from $4,000 to $12,375 per home.
Homeowners rarely pay the full price, however. In North Carolina, solar water heaters qualify for a 30 percent federal tax incentive and a 35 percent state tax credit (up to $1,400), which would cut the cost by about half.
John Murawski has been a full-time newspaper reporter since 1991, with stints at Legal Times and The Chronicle of Philanthropy (both in Washington, DC), The Philadelphia Inquirer and The Palm Beach Post (in South Florida) before arriving at the N&O in December 2004. At the N&O he covers energy (nuclear, coal, renewable, efficiency), utilities (electric, natural gas, telephone) and telecommunications. His beat includes such publicly traded companies as Progress Energy, Duke Energy, PSNC Energy, Piedmont Natural Gas, PowerSecure International, Tekelec, Cisco Systems, AT&T, among others. You can reach him at 919-829-8932 or 
Comments
no reason for that cost
Wed, 02/22/2012 - 22:12 — qvorawSomething is very amiss -- there's just no reason for that kind of cost. If a decent heat exchanger/reservoir can be had or made for >$300 ($150 for the heat exchanger, $150 for an 80 gal tank), decent collectors and a solar-powered pump for another grand. Maybe a grand for the installer guy. Payoff is 10 years at worst. WAY TOO MUCH gouging in this industry now.
Meanwhile, there are 2,000
Wed, 02/22/2012 - 20:14 — peetiepupMeanwhile, there are 2,000 solar panels going on the roof of one single building - the Raleigh Convention Center. That is the type of solar energy that will really make a difference. Spending $7,000+ to put a little one on a house that takes over 20 years to pay for itself is nice, and I salute those who do so, but large projects are what we really need for pushing green energy forward.
Just think of the hundreds of GIGANTIC roofs and parking lots in the Raleigh area that could match the size of this (malls, government buildings, warehouses, schools, etc....). It sure would be nice to park under solar panels during blazing hot summer weather.
Does anybody know whether the economy of scale in the convention center project provides for better price-per-unit? That would seem likely.
Other solar options
Wed, 02/22/2012 - 18:54 — capefearThe estimated cost for a thermal water heater is given by the grid owners. There are far more reasonable solar water heating options than the example given in this article.
time for a change
Wed, 02/22/2012 - 18:10 — outhousecatSolar energy is expensive because it's so rarely used. If solar panels were the norm on all new houses, the price would come down dramatically. Remember when microwave ovens came out? They cost about $800 a piece. Now that the technology has evolved and everybody owns them, you can buy one for $35.
If America truly wants to become self-sufficient energy-wise, we need to look into developing cheaper and more effective solar energy. But I'm pretty sure the electric company lobbyists will make sure that doesn't happen any time soon.
So totally cost ineffective
Wed, 02/22/2012 - 17:19 — George_SExtra cost $5000 (including Progress chipping in a g,) annual savings $235, net payoff is 21 years, longer than the life expectancy of a hot water heater.
Your math works if you
Wed, 02/22/2012 - 18:11 — festusYour math works if you assume fuel costs will remain flat for an entire generation, that providing electricity or gas to future consumers will have zero costs, and that there are no external costs for using fossil fuels.