Jeanette Fitzsimons

Government Spokesperson on Energy Efficiency

25 May 2007 Media Statement

$500 Grants for solar water heating launched

Government Spokesperson on Energy Efficiency and Conservation, Jeanette Fitzsimons, today launched a cash grants scheme and a new website to help householders reduce their greenhouse gas emissions through the installation of solar hot water heating systems.

The $500 grant is being offered through solar water heating suppliers who meet certain energy performance, price and installation standards.

"I am delighted to announce that Energy Conscious Design, Azzuro Solar New Zealand Limited and New Zealand Solar Limited are the first suppliers to join the Government's solar water heating programme. These companies have demonstrated they can meet the quality and energy performance standards for installed systems, and are aiming for a price that will encourage more homeowners to choose solar.

"There are also a number of other companies in the process of joining the programme, as well as interest from potential new entrants to the industry" Jeanette Fitzsimons said.

The grants scheme has been specifically designed to support cost-effective systems for householders and promote high standards being met within the industry.

In addition, the associated website www.solarsmarter.org.nz now features an online calculator that enables homeowners to estimate the potential savings from different systems and decide if solar water heating is right for them.

"Hot water typically accounts for around $800 of the domestic energy bill. A well designed and installed solar water heating system can cut this by about 50% - 75%.

"Today's announcement is good news for householders, their power bills and climate change," Jeanette Fitzsimons said.

The solar water heating programme is part of the Government commitment to sustainability. It results from the post-election agreement with the Green Party. The programme also includes:

* Working with the building industry to encourage solar water heating on new housing, particularly volume-build developments;

* Motivating demand through independent consumer information on solar water heating;

* Improving information and capacity issues by working with industry;

* Assisting with the costs of training solar water heater installers;

* Encouraging solar water heating systems on publicly owned buildings; and

* Providing guidelines for local authorities to reduce the cost of building consents.

ENDS

Questions and Answers

1. What are the eligibility criteria for the solar water heating financial assistance scheme?

The criteria include the following factors:

Industry standards - To ensure industry standards around product and installation are met, the finance assistance scheme is only available for the purchase of solar water heating systems from solar water heater importers or manufacturers accredited by the Solar Industries Association. The accreditation process requires that various standards are met.

Indicative energy performance of systems - only systems that have had their energy performance modelled, and published, are eligible for funding assistance.

Cost effectiveness threshold - The threshold for financial assistance (e.g. to get the $500 grant) is set at a level where it is likely to be cost-effective for the average consumer over a 20 year period, based on performance of that specific system. So, it will save the average consumer money if they purchase that system below the threshold. Provided the total cost of the installed system (including installation and the building consent) does not exceed the 'threshold', a homeowner can apply for Government assistance. The grant helps make the investment more attractive.

2. How much can a homeowner save by installing a solar water heating (SWH) system?

The answer will be different for every home, depending how many people live there, how much hot water they use, how much sun the home gets, the electricity or gas tariff, and which solar system they use.

In the average New Zealand household, about one-third of energy costs can be attributed to heating water. An effective solar system will reduce electricity consumption for water heating by 50 per cent or more over the course of a year. In summer months, the reduction of electricity consumption for water heating should be more than 80 per cent, but in winter months it will be less.

An effective solar system in a four-person home saves about 2,200 kWh (kilowatt hours) of electricity consumption a year. At current electricity prices, that's around $350 to $450 a year, depending on the rate you're paying.

3. How much does a SWH system cost?

The total cost of installing a SWH system in a residential property varies greatly depending on a number of factors but for a residential property can range from about $3,500 to about $8,000. In general, the cost of installation for new buildings is significantly less than for retrofits.

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