Economic and environmental analysis of solar water heater utilisation in Gauteng Province, South Africa

Abstract

This paper focuses on the energy economics and environmental impacts of solar water heaters (SWH) in the Gauteng Province and compares the results with other technology options for residential water heating with regard to the different income groups. The critical energy situation in South Africa and the highly coal dependent energy generation demonstrates the need to shift to a more sustainable way of living. The residential sector proves to be an optimal starting point to implement new technologies, especially for water heating. The residential hot water demand calculation shows that the annual demand in Gauteng is about 188 million cubic meters. In order to satisfy this demand, different technologies are investigated in this paper, where SWHs lie in focus. Due to the vast income inequality in Gauteng, and also in South Africa, it is obvious that there cannot be one single optimal solution suitable to all households. Therefore, this paper focuses on the differentiation of the residential sector into income groups to show the divergence in warm water demand and the applicability of alternative technologies. In order to analyse appropriate solutions for all income groups, low-cost alternatives are also analysed. The economic analysis shows that although SWHs have higher investment costs than conventional technologies, the payback periods are relatively short (between 3 and 4 years) for high and mid income groups. The payback periods will be even shorter when the planned electricity price tariff increase comes into effect. Furthermore, SWH utilisation has the additional effect of reducing the overall electricity demand up to 70% and greenhouse gas emissions significantly. In addition, SWHs are the most cost-effective water heating technology to reduce greenhouse gas emissions for mid and high income groups with negative abatement costs. It is concluded that the SWHs are the most suitable option to decrease fossil energy consumption and reduce the household’s expenditure for energy services, especially for mid and high income groups. For lower income groups the utilisation of solar energy can increase the access to energy services and living quality and, therewith, lessen the financial burden to meet their energy needs.

Keywords

• solar water heaters
• abatement cost
• annual expenditure
• GHG emissions
• income groups