Solar water heating systems typically range from about $7,500 to $10,000 before any tax credits or utility incentives are applied. Cost depends on the type and size system, and difficulty of installation. Incentives and tax credits often will cover 60-80 percent of the costs. Contactors and financial institutions often provide different financing programs to help cover initial costs.
There are different tax credits and incentives available to homeowners that affect the average cost and payback period of installing solar.
Federal Tax Credit
Both Oregonians and Washingtonians are eligible to receive Federal tax credits, which is 30% of total system costs (minus any utility incentive). These tax credits can be taken in the year the system is operational or can be carried forward into the next year if the credits exceed tax liability. There is no pass-through option for federal tax credits. Homeowner installs can qualify, but need to be verified by a tax credit-certified technician.
NOTE: The Federal tax credit is scheduled to expire on December 31st, 2016. As long as your system is installed and operational before the end of 2016, you’ll be able to access the 30% federal tax credit.
Oregon Residential Energy Tax Credit expired 12/31/2017
Oregon Utility Cash Incentives
Some utilities in Oregon will offer you a financial incentive if you install a solar water heater system. They typical range is from $300 to $1,500 per system. Currently, Portland General Electric and Pacific Power do not offer an incentive for solar water heating. If you have a different utility, contact them to see if they offer an incentive. The Database of State Incentives for Renewables and Efficiency (DSIRE) has a comprehensive list of utility incentives across Oregon. (When on the DSIRE site, we recommend using the filter tool and selecting “Solar Technologies” Technology category and “Rebate Program” in the Program Type category.)