HVAC Residential Market

Solar Applications Finding a Home in Residential HVAC

Photovoltaic Investment Paying Dividends in All Corners of the Nation

September 1, 2014
Trans

As energy conservation becomes a priority among more and more people and material prices continue to fall, solar energy applications such as solar photovoltaic (PV) and solar heating and cooling (SHC) are becoming less of a novelty item and more of a trend among homeowners.

According to the Solar Energy Industries Association (SEIA), the first quarter of 2014 was the first on record in which residential solar PV installations exceeded commercial installations in the U.S. Additionally, about 80 percent of the existing SHC market volume resides in the small residential sector.

But national trends don’t always apply at the local level, according to Vaughan Woodruff, owner of Insource Renewables, a Pittsfield, Maine-based solar design and installation firm that deals in both residential and commercial markets.

“Here in Maine, for instance, we are the only state in the Northeast without state-level tax credits and/or rebates for solar,” Woodruff explained. “As a result, (solar) leasing is essentially nonexistent here, and the financiers that are driving growth in the rest of the country don’t see much value in entering a market with lower returns and a smaller population than states like Massachusetts and New York. That said, the national conversation of solar becoming more affordable and attractive is influencing the decision making of a certain clientele in Maine.”

With all of the different solar applications available, determining the best option for homeowners is not a one-size-fits-all approach; it’s something often done on a case-by-case basis.

“Homeowners choose solar PV because they want to eliminate their energy bills, or drastically lower them, and their HVAC systems may not be of an age that is ready for a replacement or an upgrade,” said Jason Hanson, president and CEO, Sierra Pacific Home & Comfort Inc., Rancho Cordova, California. “Solar PV is an optional add-on that may or may not be a good value for a homeowner. It depends on a number of variables. Upgrades to HVAC happen because the old system is breaking down, inefficient, or not designed to do the job for the needs of the home; upgrading the HVAC is not a matter of ‘if’ — just ‘when.’”

Solar Heating

In Maine, Woodruff said the majority of Insource Renewables’ clients consider solar PV as an option due to its impact, or lack thereof, on their pocketbooks.

“Given the economy and culture of central Maine, most clients are making decisions like adding solar to stabilize and reduce energy costs,” Woodruff said. “The increase in the performance of mini-split heat pumps, as well as the promotion of this technology by Efficiency Maine, has driven significant growth of this sector here. As a result, we see many clients who are looking to offset their traditional HVAC loads with photovoltaics and heat pumps. Underpinning the costs of solar with the fast financial returns of offsetting oil consumption with heat pumps — the numbers can be extremely favorable.

“Other clients take a two-step approach by installing the heat pumps first and then investing in PV to offset the increased electrical consumption as a way to reinvest their savings.”

In addition, solar water heating (SWH) may be a better alternative option for some homeowners.

“The technology is under-appreciated. Most people have little sense of the energy demands of heating their water,” Woodruff said. “There is much greater nuance to selling SWH systems than conventional HVAC and even PV systems, but we often see clients move in that direction when presented with the costs and benefits.”

Incentives and Payoffs

The increase in the solar energy market is due in part to the 30 percent federal investment tax credit, which expires after Dec. 31, 2016. There are also a number of state and local rebates and tax incentives that homeowners can research.

Mike Weinberger, president, SunTrac Solar, a Tempe, Arizona-based manufacturer of solar thermal panels, said the tax incentives are significant, but cost savings is a factor as well.

“If they [homeowners] can save 20 to 30 to 40 percent off their heating and cooling bills, that’s a huge incentive,” he said. “This technology is relatively new in the evolution. It’s just beginning. We’re talking with new home builders now, and they’re starting to look at this to be part of that market as well.”

SunTrac Solar’s Thermal Smart Panel “can supply the energy needs of those 15-PV panels you see on the roof,” Weinberger said.

The Smart Panel features a SmartTrac sun-sensor system, which utilizes NASA technology to track the sun across the sky. This increases thermal efficiency up to 20 percent. The panel also allows output temperature to be controlled using RiteTemp technology.

“We’re able to solve a couple of problems that have been in the solar thermal industry for a number of years,” Weinberger said. “We have temperature devices that record and check the temperature as it travels. You know what those temperatures need to be when they’re integrated with an air conditioner. And so, if we start to have too much heat, we can literally take the focus off the sun and lower it back down and keep it in a 4?-5?F range that’s optimum for the air conditioning system that we’re integrated with.”

According to Weinberger, SunTrac Solar thermal panels presented 35 percent energy savings after five were installed and integrated with the fluid heating system at the Wild Mountain Brewpub in Nederland, Colorado. In a residential setting, one SunTrac Solar Thermal Panel integrated with a high-efficiency 4-ton a/c heat pump system in a home in Phoenix provided 59 percent energy savings on that a/c unit’s electrical usage and more than 30 percent on the home’s entire electric bill, Weinberger said.

Most of these solar energy installations are retrofits to existing homes; however, many builders are incorporating passive solar design, which uses energy-efficient construction strategies to reduce heating and cooling loads and meet them in whole or part with solar energy. Passive solar homes collect heat as the sun shines through south-facing windows and retains it in materials that store heat.

“There isn’t a great deal of new construction occurring in central Maine,” Woodruff said. “In our markets along the coast, we see more people building energy-efficient passive solar homes. Many of them opt for passive and active solar, since they provide similar benefits and allow homeowners to significantly reduce or eliminate their energy burden. SWH and PV have a greater applicability in our market since they can easily be retrofitted to existing housing.”

The Net-Zero Movement

Tim Schellenberger, vice president of product engineering at Rheem Mfg. Co., has firsthand knowledge of the growing net-zero movement — his company participated in building the Net-Zero Vision home in Tucson, Arizona, which opened in December 2013.

“People are catching on more and more to this idea of net-zero energy homes. Some people have different names for them, but, essentially, it’s net-zero energy, and that simply means the home is producing as much energy as it is using,” Schellenberger said. “That zero comes from a scoring system, the Home Energy Rating System (HERS) Index. PV can be a big part of getting to net zero; however, it’s expensive. Costs are coming down, and there are many different PV panels out there, including PV shingles or tiles for roofs. It’s [net zero] becoming more and more popular simply because we’re interested in making more energy and being less dependent.”

Schellenberger said solar thermal energy can also contribute to net zero by using renewable energy for domestic hot water or space heating purposes, which is what was done in the Net-Zero Vision home.

“It achieved a HERS score of negative 17, which is probably the first of its kind because we were using renewable energy to heat the home instead of a heat pump or some other means,” Schellenberger said. “We put in a solar hot water system that consists of two solar thermal panels and a hard 120-gallon storage tank that is used for domestic hot water — your showers, bathing, and so on — and space heating. What we did then was connect a hydronic air handler that we manufacture that utilizes that hot water to heat the home. There’s enough energy stored in that 120-gallon tank to take care of the needs of that home. And the heat loss of that home is really low anyway. It’s only 25,000 Btu, so it doesn’t take a lot of energy to heat it in the first place.”

Additionally, the home features an electric tankless water heater in the event there’s not enough solar energy to keep the 120-gallon tank hot, and a high-efficiency heat pump for cooling in the summer and as a second-stage heat source on really cold days.

The home is still on the market, according to Schellenberger.

It’s a nice home, but it’s not huge,” he said. “The price tag they started with was about $888,000. So, for a 2,200-square-foot home, that’s a lot of money. Net-zero homes are not inexpensive, you have to roll all of that into your mortgage, and, of course, you still have to afford it. And it’s kind of a niche still. To me, I think it could be the next big thing.”

Leveraging the Market

Sierra Pacific Home & Comfort began life as a solar company in 1984 and added heating and air installation and service in 1987.

“For many years, the primary solar business was solar pool heating and solar water heating. In the early 2000s, Sierra Pacific became one of the first companies in California to start installing grid-tied solar electric systems,” Hanson said. “The energy crisis had driven a demand for solar electricity, and there were very few solar companies. The few that were around were doing mostly solar thermal systems, so when we added solar electricity, we were pretty unique.”

Hanson believes the key to Sierra Pacific’s success has been having experts dedicated to each branch of the business — HVAC and solar.

“It’s my observation that contractors should treat each trade as if it were their only trade, to have a focus in their business on the one industry they can be exceptional at performing,” he said. “If they add another service, dedicate a team of professionals to focus on performing the very best in that sector. I do not use HVAC professionals to do solar, nor do I use solar professionals to do HVAC. Each department is dedicated and they are the very best craftsmen in our market place at doing their respective trades.”

Woodruff is of a similar mind.

“Having expertise in complementary and competing technologies is critical,” he explained. “We have created as much work for other contractors as we have ourselves by referring clients for energy audits, weatherization work, and pellet boilers. This has helped foster relationships with other contractors who are then knowledgeable about what we do and serves to develop a stronger word-of-mouth presence. While we could have brought these technologies under our umbrella, I have found that maintaining an emphasis on what we do well and networking with other contractors who share similar values to be a much more sustainable approach.”

Publication date: 9/1/2014

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