Developments in Solar Thermal

About a month ago, the New York Economic Development Corporation announced a pilot program for five solar thermal projects in the City. Similar to its cousin PV, solar thermal harnesses the energy of the sun, but instead of converting that energy to electricity it converts it to heat, which is then used to provide hot water for a building.

Solar thermal is by no means a new technology. It’s also not new to New York. One of the PV installers I interviewed for my journalism thesis on solar energy in the City has also been installing solar thermal systems in the five boroughs since the late 1990s. According to him, solar thermal is actually a better value than PV because of how efficient it is – such systems are able to retain 65 to 70 percent of the sun’s energy they absorb, versus just 20 percent for solar panels (at the time).

So why has solar thermal been so slow to catch on here? As the NYEDC notes, “there remains a lack of awareness, financing incentives, and regulatory clarity in regard to solar thermal technology.” Like all building projects in NYC, installing solar thermal systems is very costly. It’s a much more complex job than PV panels because it involves installing new pipes, rather than new wiring. The solar thermal installer I interviewed claimed it would be twice as expensive to put in a system in New York as it would be in a small town in say, Colorado.

Aside from the NYEDC pilot program, it may soon be easier for individuals to finance thermal installations. The recent announcement from the NY Public Service Commission on the extension of the Renewable Portfolio Standard for funding small-scale green energy projects includes solar thermal for the first time. Of the $279 million for RPS, solar thermal was allotted a paltry $24.7 million – less than 1 percent of the overall pool, but that figure could change depending on demand.

One thing that is sure to change with this official funding is the amount of paperwork that must be filled out to install a solar thermal system. This was my solar installer source’s biggest fear when describing his experiences with both PV and thermal. He said that because PV is so highly regulated by the state and by the city (and because it’s so much less efficient than solar thermal) the return-on-investment for a solar thermal system is about the same as that of a comparable PV system without any incentives funding. It will be interesting to see how installers deal with this added paperwork and how it affects costs for consumers – and how demand for solar thermal will change with these two recent developments.

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