Solar Water Heating Needs to Be Part of the Climate Solution

A big gap in California’s efforts to address climate change is in water heating. In the 1930s, California was a leader in domestic solar hot water systems; but as the availability of fossil fuels increased, together with support from state and federal policies, the solar thermal industry was overwhelmed. In 1973 OPEC’s oil embargo made energy independence a matter of national security worldwide. For some areas without fossil fuel resources, like Europe and Israel, the threat was existential.

The embargo led many countries to incentivize solar water heating. In 1978, President Carter created a 25 percent federal tax credit for such systems, and California created an additional 15 percent tax credit on top of the federal one. By 1990, a million solar thermal systems had been installed in America. Sales were $1 billion annually in 1982 but fell to $30 million by 2000. Why this collapse? Abundant and cheap fossil fuels returned, President Reagan ended the federal incentives, and the industry’s reputation of failure ended public confidence and enthusiasm.