Solar Power Tax Credit for Solar Water Heaters: 2026 Rules, Certified Models, and Real Savings

EcoFlow- 2026/10/30

Table of contents

The federal solar power tax credit for homeowners, including solar water heaters, ended after 2025. The IRS says the Residential Clean Energy Credit under Section 25D doesn't cover expenditures made after December 31, 2025. A deposit paid in 2025 won't qualify a system installed in 2026. Solar hot water can still be worth considering. Compare certified systems, estimated energy savings, and available state or utility rebates. Your best option depends on your climate, hot water use, fuel costs, and installation quote. If outages are common in your area, also check whether the system can keep running without grid power.

Is There Still a Federal Tax Credit for Solar Water Heaters in 2026?

No. The federal solar power tax credit ended for expenditures made after December 31, 2025. A solar water heater installed in 2026 doesn't qualify, even if you paid a deposit in 2025. Qualifying systems completed in 2025 may qualify for the 30% credit on the 2025 tax return if they met the IRS requirements: at least half the energy used to heat household water came from the sun, and the system was certified by the Solar Rating Certification Corporation (SRCC) or a comparable state-endorsed organization. Pool and hot tub heating systems weren't eligible, but the home didn't have to be your primary residence.

If your solar water heater installation was completed...	What the IRS says
During 2025, by Dec 31, and it met the SRCC (or state-endorsed) and half-solar rules	Eligible for the 30% Section 25D credit on the 2025 return (Form 5695)
After Dec 31, 2025, even if paid in 2025	Not eligible for Section 25D
For a pool or hot tub	Never eligible under Section 25D

The IRS confirms the deadline on its Residential Clean Energy Credit page. The federal credit for qualifying heat pump water heaters also ended after 2025, so switching to a heat pump doesn't restore that tax benefit. Business tax rules may differ, so business owners should consult a qualified tax professional.

Incentives that can still apply in 2026

Some states and utilities still offer rebates for solar water heaters. Hawaii is one example. Hawaii Energy lists rebates of up to $2,750 for eligible customers during its 2026–2027 program year, through June 30, 2027. The program covers eligible electric ratepayers on Hawaii Island, Lānaʻi, Maui, Molokaʻi, and Oʻahu. Kauaʻi isn't included. Rebates are first come, first served while funding lasts. The amount varies by county and system, and a participating contractor must complete the qualifying installation or retrofit and submit the application.

If you live elsewhere, check your state energy office, utility provider, or the DSIRE incentive database for current programs. Confirm the eligibility rules and application deadline before counting a rebate toward your budget. Changes to the residential clean energy credit under the 2025 tax law also ended the federal homeowner credit for other qualifying clean energy property installed after the deadline. With no federal credit available for a 2026 installation, certification is a useful starting point for comparing solar water heaters and their published performance ratings.

How Do Certified Solar Water Heaters Compare on Efficiency and Modeled Savings?

Start with two public records: the ICC-SRCC OG-300 certificate and the ENERGY STAR product listing. The OG-300 certificate provides modeled annual energy savings for specific locations, while ENERGY STAR lists the system's Solar Uniform Energy Factor (SUEF). Neither rating guarantees what you'll save on your utility bill, but both help you compare equipment on a consistent basis. The ENERGY STAR certified solar water heater directory includes dozens of systems from manufacturers such as Heliodyne, Rheem, Solahart, SunEarth, and others. The examples below show how to read their published specifications. They're listed alphabetically by manufacturer, not ranked from best to worst. The linked OG-300 reports are Heliodyne 2001023B, Rheem 2009033D, Solahart 30003791, and SunEarth 30004307.

A snapshot of certified systems

System (OG-300 no.)	Type	Collector(s)	Solar tank	Backup	SUEF (ENERGY STAR)	Modeled annual savings, kWh: Phoenix / Denver / Boston / Seattle	Certificate expires
Heliodyne HF 1 410 G 80 AC S E (2001023B)	Pumped, direct	1 × Heliodyne 410 001	303 L (about 80 gal)	Electric	6.6	3,300 / 3,380 / 2,780 / 2,460	Nov 1, 2026
Rheem SolPak RS80-40BP (2009033D)	Pumped, indirect	1 × Rheem RS24-BP (24.7 sq ft)	303 L (about 80 gal)	Electric	4.8	2,890 / 2,900 / 2,360 / 1,990	Mar 1, 2027 (directory)
Solahart ASE 302J (30003791)	Thermosiphon, indirect	2 × Solahart J	300 L (about 79 gal)	Electric	9.0	2,760 / 2,360 / 1,760 / 1,510	Mar 1, 2027
SunEarth Cascade 2 C2-40T-50-TLG (30004307)	Pumped, indirect, drainback	1 × SunEarth TRB-40	189 L (about 50 gal)	Gas tankless	5.2	4,740 / 5,020 / 4,310 / 3,860	Oct 1, 2027

These savings figures are based on computer models that assume daily hot water use of 64.3 gallons heated to 125°F. Actual results vary with local weather, roof orientation, installation quality, household use, and backup fuel, so a difference of a few hundred kilowatt-hours doesn't necessarily mean one system will perform better in your home. SUEF measures the energy a system delivers relative to the electricity or gas it uses. ENERGY STAR requires a SUEF of at least 3.00 for systems with electric backup and 1.80 for those with gas backup, along with minimum warranty periods for collectors, sealed systems, controls, and parts. Check the listing for the exact model, since ratings can vary between systems from the same manufacturer. SUEF uses defined hot-water draw patterns; compare systems with matching draw patterns and backup fuels, rather than assuming every SUEF figure uses the OG-300 annual-savings load above. The expiry dates shown follow the live OG-300 directory checked October 30, 2026. For Rheem 2009033D, the directory shows March 1, 2027, while the linked PDF still prints March 1, 2026; confirm the renewed certificate with ICC-SRCC before purchasing.

Active or passive, direct or indirect: which fits your climate?

The main difference is how water moves between the collectors and the storage tank.

Active systems use pumps, valves, and controls. They can work well in many climates, but the circulation equipment needs electricity.
Passive systems rely on natural circulation or other designs that don't require pumps. They can be simpler, though the right setup depends on your home and climate.
Direct systems circulate the water being heated through the collectors. They're best suited to places where freezing is rare.
Indirect systems use a separate heat-transfer fluid in a closed loop. They make more sense where temperatures can fall below freezing.
Evacuated-tube collectors can perform well in colder or cloudier conditions, but they may cost substantially more than flat-plate collectors. Batch systems generally aren't a good fit for places with distinct winters.

Before choosing a model, look up its OG-300 certificate and confirm that the certification is active. Then ask the installer how the collectors will be positioned on your roof. Knowing where to mount solar water heaters helps you judge whether the published savings estimate makes sense for your property. There's another practical issue to consider, especially if you live in an area affected by hurricanes, winter storms, or other outages: the system may need electricity even though the sun heats the water.

Do Solar Water Heaters Work During a Power Outage? (EcoFlow TITAN 5000 Classic)

Passive solar water heaters can continue collecting heat without electricity because they don't use pumps. Active systems rely on electric pumps and controls to circulate water, so they stop working when those components lose power. Electric backup elements also need electricity, and some gas tankless heaters require it for ignition and controls.

Can a home battery keep the system running?

A compatible home battery may keep a 115V or 120V solar water heater pump and controller running during an outage. The EcoFlow TITAN 5000 Classic delivers 4,000W at 120V, but it only supplies electricity, not heat. Check your equipment's voltage and wattage first, as the unit can't power a 240V electric heating element or loads above its rated output. For gas tankless heaters, check whether they need electricity for ignition and controls. Runtime depends on the pump's power draw and other connected devices, and a licensed electrician should handle hardwired connections.

EcoFlow TITAN 5000 Classic

•4,000W Whole-Home Essential Power. Run your fridge, microwave, Wi-Fi, lighting, and CPAP all at once. • 5–30kWh Expandable Capacity. Get 1 day to 1 week of essential backup. Add batteries anytime, with no installer needed. • <25 dB. Quiet enough for indoor use—quieter than a whisper. • ≤20 ms Automatic Switchover. The lights don’t even flicker. • OASIS 3.0 — Your AI-based Home Energy Manager. Charges off-peak, powers your home during peak hours, and helps lower your electricity bill every day. •North America Highest Safety Standards. UL 9540 certified and tested to UL 9540A, UL 1741 compliant, with EV-grade LFP cells, 24/7 BMS monitoring, and a 5-year warranty.

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How long could one unit run a pump station? (labeled estimate)

You can estimate pump runtime with a simple calculation: Usable battery energy ÷ pump and controller wattage = estimated runtime in hours. For planning, allow 15% for conversion losses. That leaves about 4,265Wh from the EcoFlow TITAN 5000 Classic's 5,017.6Wh capacity.

Pump station plus controller label (placeholder, replace with your own)	Estimated pump run time, one 5kWh unit
50W	4,265 ÷ 50 ≈ 85 hours
100W	4,265 ÷ 100 ≈ 43 hours
200W	4,265 ÷ 200 ≈ 21 hours

These are estimates of pump run time, not the number of calendar days the system will provide hot water. Solar pumps may cycle throughout the day, and other devices sharing the battery will reduce the available energy. Cloud cover, the backup heater, and heat lost from the storage tank also affect the result. Once you've checked the system's electrical needs, you can compare installed prices and estimate whether the energy savings justify the cost.

What Does a Solar Water Heater Cost, and How Much Could It Save?

For an installed-price comparison, request itemized local quotes for the certified systems listed above. Heliodyne directs buyers to its sales team, while SunEarth offers quotes. Your most useful number will come from an installer who has assessed your roof, plumbing, backup heater, and local permit requirements. Ask for an itemized quote covering:

Solar collectors and storage tank
Pump station and controller, if the system is active
Roof mounting, labor, and any structural work
Freeze protection fluid for an indirect system
Permits and inspection fees
Changes to the existing water heater or plumbing

Also ask for the OG-300 certificate number of the exact system in the proposal. That lets you compare the quoted equipment with the published performance data. ENERGY STAR says using sunlight to heat or preheat household water can cut annual hot water costs in half. Treat that as general guidance, not a promise about your bill. Your savings depend on how much hot water you use, what fuel you currently use, local energy rates, and how well the system performs.

A sample savings estimate

Consider the Rheem SolPak RS80-40BP, which has modeled annual savings of 2,890 kWh in Phoenix and 1,990 kWh in Seattle. Using the US average residential electricity rate of 18.16 cents per kWh reported for August 2026, the examples work out as follows:

Phoenix: 2,890 kWh × $0.1816 = about $525 per year.
Seattle: 1,990 kWh × $0.1816 = about $361 per year.

These are illustrations, not predictions for an individual home. The calculations use the national average electricity rate, not the actual rates paid by households in Arizona or Washington. Your results may also differ because of hot water use, installation quality, and whether your backup heater runs on electricity or gas.

To estimate your own savings, start with the modeled kWh figure for the closest city on the OG-300 certificate. Multiply it by your actual electricity rate, then compare the estimate with your itemized installation quote. If a state or utility rebate applies, subtract it from the project cost. Don't include the expired federal residential credit in a 2026 calculation. Use the ENERGY STAR buying guidance to assess the system alongside your own costs and energy rates, rather than a salesperson's payback promise.

Is a Solar Water Heater Still Worth It Compared With a Heat Pump Water Heater?

A solar water heater can be worth considering in a sunny location with high energy costs or a useful local rebate. A heat pump water heater is another option, and neither system has a federal residential tax credit for installations completed in 2026. Compare the full installed cost, expected energy use, space requirements, and local incentives before choosing.

What to compare	Solar water heater	Heat pump water heater
How it heats water	Solar collectors transfer heat to water or a heat-transfer fluid	Electricity moves heat from surrounding air into the water
Space needed	Suitable roof area and space for a storage tank	Indoor space with enough surrounding air
Electricity use	Active systems need power for pumps and controls	Uses electricity to operate the heat pump
Cold-weather concerns	Requires suitable freeze protection where temperatures drop	Performance and operating mode can change in colder spaces
Federal residential credit in 2026	None	None
Other incentives	Check state and utility programs	Check state and utility programs

Heat pump water heaters generally need an indoor location that stays between 40°F and 90°F year-round, with about 1,000 cubic feet of surrounding air. In colder conditions, some models may switch to standard electric resistance heating, which uses more energy. A solar water heater has different space and roof requirements, and its performance depends on the system design and local sunlight. Compare actual quotes for both options. Include installation, any electrical or plumbing work, expected energy costs, and available rebates. Follow the exact model's temperature and air-volume requirements, since designs and ducting options vary. You can also compare heat pump water heater savings with the solar system's OG-300 estimate to see which option better fits your home.

How to Choose a Certified Solar Water Heating System in 2026

Start with the certification, match the system to your climate, and get detailed quotes before you commit. A little checking now can prevent confusion over performance claims, rebates, and installation costs later. Use this checklist when reviewing your options:

Confirm the certification. Look up the exact model in the ICC-SRCC directory. Check that its OG-300 certificate is active and note the expiration date.
Check the ENERGY STAR listing. Review the SUEF and warranty details for the specific system.
Match the system to your climate. Ask about freeze protection if your area gets freezing temperatures. Avoid batch systems in places with distinct winters.
Request local savings estimates. Get the modeled annual kWh figure for the closest city, then calculate potential savings using your own utility rate.
Check the electrical requirements. Ask the installer for the pump station's voltage and wattage and what happens if the grid goes down.
Verify available rebates. Check state, utility, and DSIRE listings. Don't count on the expired federal homeowner credit for a 2026 installation.
Keep your paperwork. Save the certificate, itemized invoice, rebate approval, and installation completion date.

Some state solar incentives may still reduce the cost of a solar water heating system. Confirm the rules directly with the program before signing a contract, and make sure the quoted equipment meets its requirements.

Conclusion

The federal solar power tax credit no longer covers solar water heaters installed in 2026. Homeowners can still compare certified systems, use OG-300 estimates to assess potential energy savings, and look for state or utility rebates. Get itemized quotes and check the certification status of the exact model before buying. If your active solar water heater relies on a compatible 120V pump station, plan separately for outages. The EcoFlow TITAN 5000 Classic may power a verified pump and controller when the load fits its limits, and the system is connected correctly. It won't heat water or restore the expired tax credit. Have a licensed electrician check any hardwired connection before you count on battery backup.

FAQs

Can I get a federal tax credit for a solar water heater installed in 2026?

No. The Residential Clean Energy Credit doesn't apply to expenditures made after December 31, 2025. The IRS treats the expenditure as made when the original installation is complete, so a deposit paid in 2025 doesn't qualify a system installed in 2026.

What made a solar water heater eligible for the credit before it ended?

The system had to heat water for home use, get at least half of its energy from the sun, and meet SRCC certification or a comparable state-endorsed standard. Solar water heating equipment for pools and hot tubs didn't qualify.

How much can a solar water heater save each year?

Savings depend on climate, energy rates, household hot water use, and installation quality. ENERGY STAR says solar water heating can cut annual hot water costs in half, while OG-300 certificates provide modeled energy savings by location.

Do solar water heaters work in cold or cloudy weather?

Yes, if you choose a system suited to the climate. Indirect systems offer freeze protection for colder regions, and evacuated-tube collectors can be useful in colder or cloudier conditions. Ask an installer which certified system fits your location.

Will my solar water heater work during a power outage?

Passive systems can keep collecting heat without a circulation pump. Active systems need electricity to run their pumps and controls. A compatible 120V home battery, such as the EcoFlow TITAN 5000 Classic, may power a verified pump station, but it doesn't heat water or guarantee hot water throughout an outage.