People ask "What is the payback?" for solar water systems. First and foremost it does have payback. If you buy propane, oil, electricity or gas the supplier does not offer you any payback. No matter how much you buy and no matter how long you buy it for, you never get your money back. Some define payback as the annual fuel bill savings divided by the capital cost. This is inaccurate misleading and wrong.

To take a proper view of payback, you have to factor in future energy increases, take account of inflation look at the savings in equipment servicing and the ability to make your equipment last longer. Doing the sums properly most thermal systems offer a payback of between 6 and 15 years, depending on the fossil fuel displaced, the future fuel inflation factor you use and the amount of hot water you use.