In this article, we discuss how solar hot water is a reliable energy source for commercial buildings. Solar hot water can significantly lower a building’s energy costs over the long term, and requires minimal maintenance.

Canada is lucky to have a large supply of energy resources at its disposal. Compared to a lot of the world, our energy is relatively inexpensive and is well distributed. Let’s look at a quick comparison: in 2013 the electricity rates in Denmark were around 40 cents / kWh and Germany was close behind at 36 cents / kWh. France had the lowest rates of the EU at around 20 cents / kWh. Compare that to Canada and the US, which can average around 10 cents / kWh depending on your local area and usage [1].

This makes it fairly obvious that energy conservation in North America is not nearly as financially important as it is elsewhere. This helps explain the relatively slow adoption of renewable energy, since the savings from these projects take longer to be realized than they do in other parts of the world.

Looking at solar technology, there are two primary types of systems that we need to differentiate: solar photovoltaic and solar hot water. Photovoltaic cells produce electricity, but solar hot water uses a collector that transfers heat energy directly into water. Solar hot water transfers heat energy directly from one medium to another, which means it has an efficiency of over 80%, compared to photovoltaic cells that typically have an efficiency of less than 20% as the solar radiation is converted into electricity.

Solar Hot Water:

Solar Hot Water


Due to Environmental Concerns and rising energy costs, Solar Hot Water has become a viable alternative energy solution for commercial business. It is considered to be one of the least expensive renewable energy sources a business can invest in regardless of the business size. Solar hot water can be used to provide a relatively large portion of the hot water used for restaurants, hotels, fitness centres, shower water, commercial dishwashers, laundry services or washing stations and even in-floor heating.


  • Significantly lowered energy costs: reducing the amount of fuel to heat water, thus reducing your bottom line.
  • Environmental benefits: Solar energy is the most abundant natural resource available today.
  • Minimal maintenance required.

Solar hot water systems are designed to create enough heat for 60-80% of your annual hot water needs. This is because the largest that a system is sized for is 100% of your hot water during the summer months, but this means that during the winter months it will only produce enough heat to reduce your hot water heating energy by 40 – 60%. Systems are sized this way because one of the primary concerns in solar design is over-heating in the summer. While it’s okay for systems to occasionallystagnate, it’s not good if they are stagnating for long periods of time day after day. Excessive stagnation times reduce the life expectancy of equipment and increases the maintenance frequency of replacing glycol.



Solar Hot Water 1With a properly designed system, the payback period of an installation is currently between 12-18 years depending on the individual application. All the systems have a life expectancy of 25 years or more, so they have a positive net present value when you look at very modest inflations in utility rates (3% per annum) and usually have an IRR over 8%. This calculation also takes into account standard historical interest rates, annual maintenance, and an annual equipment discount rate. Most systems have an energy monitoring function built into their controller which lets you know exactly how much energy is being produced by the solar hot water system and verify the savings that you should see. But as with most things in life, it will have the most financial benefit if it’s designed and installed right. So make sure you use someone you trust to install your next solar hot water system.

[1] IEA Key World Energy Statistics 2013 (page 44)

Article Courtesy of RSL – Alex Gibbs – Mechanical Engineer – Commercial HVAC/R Sales & Technical Support.

If you would like to learn more about installing a solar hot water system, contact our services team today.