Following a slightly leading question from my colleague David, I've done some
quantitative analysis on the potential savings now and under a hypothetical Renewable Heat Incentive regime.  The RHI will now require metered amounts for which I've used the modelled kWh savings from a solar  thermal system over a non solar thermal system.  In reality these may be below the actual meter amounts as these will include any storage losses.

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I've modelled:
   -  1) an A rated combi boiler  (although the house and number of bathrooms is too large for a combi)
    - 2) an A rated combi boiler with low flow showerhead
    - 3) an A rated boiler with a solar ready 250litre cylinder
    - 4) an A rated boiler with a solar ready 250litre cylinder and ultra low flow showerheads
    - 5) an A rated boiler, solar thermal system and 250litre cylinder
    - 6) an A rated boiler, solar thermal system and 250litre cylinder and RHI payments
    - 7) an A rated boiler, solar thermal system and 250litre cylinder and low flow showerhead
    - 8) an A rated boiler, solar thermal system and 250litre cylinder and low flow showerhead and RHI payments

Not done yet....I've also looked at the paybacks with fuel prices and RHI prices remaining static as well as with a 10% annual increase in fuel prices and a 2.5% increase in RHI payments.

I've applied costs that are either marginal (i.e. for solar thermal) or that apportioned to the hot water (i.e. in the case of a boiler).

And here are the results:
       Annual Saving        Install Cost             Payback                        Payback                        20 year savings
            (year 1)                                        (static prices)        (with prices increases)            (less capital outlay)
1)          £125                    £200                    <2 years                        <2 years                              £6,959
2)          £143                    £250                    <2 years                        <2 years                              £7,940
3)          £107                  £1,000                   <9 years                        <7 years                              £5,071
4)          £146                  £1,050                   <8 years                        <6 years                              £6,853    
5)          £171                  £3,500                  <20 years                      <12 years                             £6,638
6)          £309                  £3,500                  <11 years                        <9 years                            £10,163
7)          £195                  £3,550                  <18 years                      <11 years                             £7,676
8)          £310                  £3,550                  <11 years                        <9 years                            £10,614

A normal house uses around £250 of hot water a year. A normal house could expect to save 50-70% of that with a £5,000 system. The maths isn't hard - 28 year payback at best. The key thing is that the proportion of our energy bills due to hot water is much less than most of us think.  It's also much easier and cheaper to make savings by reducing your demand (less baths, combi boilers, low flow showerheads etc) rather than trying to make you own. 

And once you do this the paybacks are even longer.

That's not to say solar thermal is always way down the list of things to do, and it can be a really good solution for properties off the gas network or where you have a rugby team staying in your home.

So back to the question at hand.  Why am I installing a solar thermal system? 5 reasons really...

1) I'm starting from a situation where there is no heating system (I took out the storage heaters and multi point gas boiler) so installing a solar thermal system in addition to the rest of the work will be a marginal extra cost.
2) I've got a young and growing family and there are likely be lots evening baths (especially when the rugby age arrives)
3) With a super insulated house the proportion of our energy bills that are due to hot water will be relatively large and so achieving our personal ambition to be as low impact as possible means starting to tackle some of those areas usually less worthwhile.  It'll be interesting how long we can survive on solar thermal and the wood burner before the gas boiler gets turned on for the winter.
4) I expect gas prices to rise
5) There is still a chance the Renewable Heat Incentive tariffs - rightly or wrongly - will be set at a level to make solar thermal systems financially worthwhile.

The Renewable Heat Incentive Premium Payment of £300 isn't one of our reasons as it doesn't make much impact.  We do however welcome the decision to gather more data before setting tariffs.

I'll blog a bit more about the details when it gets installed...