Solar Water Heating

Let the sun give your hot water heater a break

Solar Water Heating

Did you know that 20-30 percent of your home’s energy is used to heat water? That’s as much or more energy than you use for your appliances, electronics and lights. Installing a solar water heating system is one of the single greatest energy-saving improvements a homeowner can make. Best of all, with cash incentives and state and federal energy tax credits, you can offset up to 65 percent of your initial investment.

How does solar water heating work? View this simple diagram, then check out a few Oregon home solar installations.

Energy Trust offers cash-back incentives, sound advice and helpful resources for installing a solar water heating and pool heating systems at your home. Visit our solar water heating resources page to begin gathering information about going solar.

How can we help? For more information, questions or comments, call us at 1.866.368.7878 or email our solar team.

Note: Energy Trust provides technical assistance and financial incentives but does not develop, sell or install energy systems or equipment. This work is done by independent businesses that are solely responsible for the quality and performance of their installations.

How do solar incentives work? Energy Trust provides funding to reduce the upfront cost of installing a qualified home solar water or pool heating system. The amount of the cash incentive depends on your utility and how much energy your system will save annually.

To make it easy for you, the cash incentive is applied upfront—like a coupon—reducing the amount you pay to your contractor. Once your project is complete, we verify that it was properly installed and then reimburse your contractor for the amount of the cash incentive.

Energy Trust Incentives

  PGE or Pacific Power customers, electric water heating NW Natural or Cascade Natural Gas customers, gas water heating
Solar water heating $1,000 in Zone 1; $1,200 in Zones 2 and 3 $550 in Zone 1; $700 in Zones 2 and 3

Incentive offer is subject to availability of funding and may change.

Find your location on the solar water heating zone map.

How do I determine how much incentive I will receive?

The amount of your cash incentive depends on the fuel you use for your backup water heater.

How do I determine how much energy I will save?

Home solar water heating systems are rated by a national organization to determine how much energy they will save when installed in different climate zones.

Qualified solar water heating systems and their estimated savings can be found on Energy Trust’s Eligible Residential Solar Water Heating Systems list. Actual savings will vary based on household hot water use. While solar water heating systems save energy for any home the highest savings will be seen by households with high hot water loads.

Tax Credits

In addition to Energy Trust’s cash incentives, your project may be eligible for a state energy tax credit from the Oregon Department of Energy and a federal energy tax credit. Tax credits, sometimes called tax incentives, reduce the amount of tax you owe dollar for dollar.

The following description of the tax incentives does not constitute tax advice and cannot be used to avoid IRS penalties:

Oregon Residential Energy Tax Credit: An Oregon tax credit may be available. View availability and requirements. Ask your tax professional for complete details.

Federal energy tax credit: A federal tax credit may be available. View availability and requirements. Ask your tax professional for complete details. For the federal income tax credit, net system cost is the total installed cost less the Energy Trust incentive.

State and federal tax credits are subject to change.

You must be an Oregon customer who heats their water with electricity from Portland General Electric or Pacific Power, or with gas from NW Natural or Cascade Natural Gas. Domestic solar water heating systems (for heating water that is used inside your home) must be on Energy Trust’s eligible residential solar water heating systems list.

All systems must be installed by a qualified Energy Trust solar trade ally contractor. Self-installed systems do not qualify. Systems must be new, and incentives are not available for replacing components. Expansions or repairs to existing solar systems are not eligible.

If your water heating fuel is not provided by Portland General Electric, Pacific Power, NW Natural or Cascade Natural Gas, please visit to learn if your utility provides incentives for solar installations.

Incentives are not intended to influence consumer decisions on fuel sources.

Follow these steps to install a home solar water or pool heating system and get your cash incentives and tax credits:

1. Establish your eligibility. Contact an Energy Trust or Solar trade ally.

2. Get bids from several Energy Trust solar trade ally contractors. Your contractor must be listed with Energy Trust if applying for cash incentives.

3. Select a contractor. Need help comparing bids? Read the How to choose a solar contractor fact sheet.

4. Sign a contract with your installer. Your contractor will complete and submit your Energy Trust application form on your behalf. Your Energy Trust cash incentive is applied to the cost of your solar installation upfront—like a coupon—reducing the amount you pay your contractor.

5. Your contractor installs your system. Typically, it takes anywhere from two weeks to two months from the time you select your contractor to the completion of your installation.

6. Complete and submit the application for your Oregon Residential Energy Tax Credit. Your contractor will provide the form and assist you.

7. Claim your federal energy tax credit when you file your taxes. Complete the IRS Residential Energy Credit Form and submit it with your federal tax return.

8. Enjoy your clean, free, renewable energy for years to come!

Questions? Call us at 1.866.368.7878 or email our solar team.

Your contractor will work with you to complete the proper form for your Energy Trust cash incentive. They will also provide assistance with completing your state energy tax credit application.

Have questions? Call us at 1.866.368.7878 or email our solar team.

Interested in going solar? Here are some great ways to get started, and the supporting resources you will need along the way.

Other Resources

Fact sheets

Consumer guides to solar water heating

Tax credits

Tools and other resources