Date of Award

12-2014

Level of Access

Campus-Only Thesis

Degree Name

Master of Science (MS)

Department

Resource Economics and Policy

Advisor

Sharon J. Klein

Second Committee Member

Jonathan Rubin

Third Committee Member

Mario Teisl

Abstract

The results indicate that for the average Portland, Maine household size of 2.5 persons (average hot water use of 45 gallons/day), under current financial incentives (30% federal investment tax credit), SWH yields a 30-year net present value (NPV) of -$3,300, -$300, $970, and $1,900 when installed to displace natural gas, electricity, fuel oil, and propane, respectively (respective min-max ranges due to uncertainty in input parameters: -$6,900 to $827; -$4,700 to $4,900; -$3,900 to $6,600; -$3,200 to $7,900). Larger household sizes and/or hot water demand increases NPV for all backup fuel types, resulting in positive values for electricity backup starting at 50 gallons/yr hot water demand (NPV $400). These results are inflation-adjusted to $2011 and assume a 2-collector 3 kW SWH system, 3% discount rate, and 50% down payment by the household. The NPV results yield a market potential estimate of 0-17% of all houses in Maine meeting technical and economic parameters necessary to install SWH. The social cost-benefit analysis included an evaluation of the value of avoided greenhouse gas emissions in comparison to the value of monetary resources employed by incentive programs. The total statewide social benefit of all households that meet market potential adopting SWH would be between $0 and $58 million, with the average installation for a 2.5-person household producing a social benefit of $300-$400 (natural gas backup); $270-$450 (electric backup); $380-$520 (propane backup); and $480- $640 (fuel oil backup).

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