Frequently asked questions about SRP's commercial solar water heater program
Program eligibility
Benefits
System design and installation
Contractor selection
Why does SRP provide incentives for the installation of commercial solar water heaters?
SRP pays the incentive in exchange for the renewable energy credits generated by the solar water heater. These renewable energy credits are used to ensure that SRP is complying with its sustainable resource goals. In addition, SRP offers solar incentives to encourage investment in solar energy while defraying the cost of purchasing and installing a solar water heater.
Why does SRP prorate the incentive payment for some solar water heater installations?
The placement of the solar collector panels will affect the energy savings that a solar water heating system will realize. The OG-300 rating used to calculate the incentive is based on the panels being in an optimal location with sufficient tilt and facing due south. SRP allows for different panel placement configurations, but reduces the incentive to account for the anticipated reduced energy savings. SRP will not provide an incentive for systems with panels that face north.
When will I receive my incentive check?
Solar water heaters with an OG-300 rating will receive the incentive check after the system passes an SRP performance audit and all necessary paperwork has been verified. All other solar water heaters will receive 40% of the incentive upon receipt and verification of all required documentation and successful completion of the audit. The remaining incentive, which will be based on actual system performance, will be paid after completion of a 12-month performance verification test.
Why do I need to sign a Bill of Sale for Environmental Attributes?
SRP pays the incentive in exchange for the renewable energy credits generated by the solar water heater. The Bill of Sale represents the formal document that provides SRP with ownership of the environmental attributes and environmental attribute reporting rights associated with those renewable energy credits.
Program eligibility
Do I have to be an SRP customer to receive an incentive?
Yes. You must be an SRP customer at the address at which the solar water heater is to be installed.
Can I replace parts of an existing solar water heater and still qualify for the program?
No. You must install a new and complete solar water heater to qualify for the program.
What types of solar water heaters qualify for the incentive?
- OG-300 solar water heaters: To qualify for the incentive, the solar water heater must be OG-300 certified by a third-party entity approved by SRP. To view a list of OG-300 certified systems, please visit the Solar Rating & Certification Corporation (SRCC) or the International Association of Plumbing and Mechanical Officials websites. SRP does not provide incentives for direct forced systems (also known as open-loop systems) that utilize a flush-type freeze protection valve, as these systems do not have adequate freeze protection.
- Standard solar water heaters and solar pool heaters: To qualify for the incentive, the solar water heater panels must have a current OG-100 certification.
If I replace my gas-powered water heater with a solar water heater, can I qualify for an incentive under this program?
Yes. You can obtain an incentive under this program when you replace an electric or gas water heater with a solar water heater.
Benefits
What are the benefits to having a solar water heater?
You can take control of your energy bill by harnessing the sun to reduce the amount of electricity required to heat your water. A solar water heater can offset up to 50% of your annual water heating costs. Also, you will be helping to protect the environment by using clean, renewable energy to heat the water for your business.
What tax credits are available?
Arizona currently offers a tax credit equivalent to 10% of the system cost, capped at $25,000 per business. The federal tax credit is 30% of the cost, with one exception. Solar pool heating systems are not eligible for the federal tax credit. These credits are obtained through your annual tax process. SRP recommends that you contact your tax professional with any further questions on these tax credits and whether you are eligible to take advantage of them.
System design and installation
What should I consider before installing a solar water heater?
Prior to installing a solar water heater, please consider the following:
- Contractor selection. As with any business improvement project, its ultimate success is dependent on choosing the right contractor. Get advice to help you make an educated choice.
- System Type. There are different types of systems and costs can vary widely among contractors. You should research the system types available so that you ultimately select the best type for your business.
- Maintenance. Solar water heaters will require ongoing maintenance, so know the system's recommended maintenance schedule and take these costs into consideration when selecting your solar water heater.
- Panel location. It is important that the panels receive the greatest amount of sunlight. As a result, you should consider factors that will impact the sun's ability to shine on the panels including shading from obstructions (such as trees), the tilt angle of the panels, and the direction the panels are facing (southern exposure is best).
- Mounting. The method of mounting for some systems could impact roof warranties and business insurance policies.
How do I know what size system to select for my business?
First, you need to consider how much hot water you use typically at your business. A solar contractor can help you select a system that will meet your needs and our program requirements.
Will I have hot water when there is no sunlight?
Your solar panel will not generate hot water when there is no sunlight. So, you must have a water heater backup system that is powered by electricity or gas to ensure that you have hot water when your solar water heater is not working. If you do not have a backup system, you will not have hot water if your solar water heater is not operating.
How long will my solar water heater last?
The lifetime of your solar water heater is dependent on the type of device selected, the quality of the installation, and compliance with maintenance requirements. Your contractor should provide you with a comprehensive maintenance plan based on the manufacturer's recommendations for your system type.
What warranties should be included when I purchase a solar water heater?
At a minimum, your solar water heater must have the following warranties to qualify for SRP's solar incentive program:
- Collectors. Solar collectors must have a 10-year warranty provided by the equipment manufacturer that protects against defect or component breakdown.
- Storage Tank. The storage tank must have a 5-year warranty provided by the equipment manufacturer that protects against defect or component breakdown.
- Installation. The installer must provide a 2-year warranty that protects against defects in the overall installation of the solar water heater. In addition, the installer must provide a 2-year warranty that covers roof penetration leaks. These installation warranties also must provide for no-cost repair or replacement of affected components, including any associated labor that is not otherwise provided by the manufacturer, during the warranty period.
Will my solar water heater need a British thermal unit (BTU) meter?
Yes. It must include the installation of a customer-owned BTU meter manufactured by Metrima or an SRP approved equivalent. The BTU meter must remain as part of the solar water heater for the entirety of its operating life. Solar water heaters with an OG-300 rating do not require the installation of a BTU meter.
Why do solar water heaters have to be OG-300 rated?
SRP uses the ratings provided by the independent, third-party companies who evaluate each system based on the region where they will be located. The OG-300 rating evaluates the entire system from panels to tank. If a solar water heater is OG-300 rated, it means the entire system has been certified to meet applicable requirements.
Why do solar water heaters have to be OG-100 rated?
SRP uses an independent, third-party entity that evaluates each system based on the region where they will be located. The OG-100 rating evaluates the solar water heater collector panels. If a solar water heater is OG-100 rated, it means the panels have been quantified to show the panel energy output which is used to determine estimated system performance.
What is an Energy Savings & Design Output (ES&D) report?
The ES&D report is required for all standard and pool solar water heating systems. Solar water heaters with an OG-300 rating do not require an ES&D report. The report must provide a description of the system including the major components, designed performance, system output and identify applicable standards and/or codes used in the system design. A professional engineer must approve the energy savings estimate in the ES&D report.
Contractor selection
Who installs solar water heaters?
A properly licensed contractor must install the solar water heater to ensure it complies with all applicable building codes and SRP program requirements. SRP does not install solar water heaters, nor do we promote or partner with individual contractors. The following solar interest groups do provide lists of solar water heater contractors that you can contact for more information:
What type of license does a contractor need to have to qualify for the program?
To qualify for the incentive, SRP requires the installer to have the appropriate license from the Arizona Registrar of Contractors as outlined below:
- The installer represents the company that is actually installing the solar water heater on your business. Installers must have one of the following license types: A-19, K-74, K-77, K-78, KA-6, L-74, L-77, or L-78. If the contractor can show that the scope of work associated with their license application includes a solar water heater installation component, the following licenses also would be accepted: K-05 or L-05.
Where can I find out if a contractor has the appropriate license?
Please visit the Arizona Registrar of Contractors' website or call them toll free at (888) 271-9286 to verify the validity of the contractor's license.