There are two kinds of solar water heater – passive and active. Both collect radiant heat from the sun into a solar hot water panel, and both can serve much of any household's hot water needs, while at the same time, both can cut back considerably on energy costs.

An active system circulates water (or other heat-transferring fluids) through a solar water pump, while a passive system circulates the liquid(s) through use of a process called natural convection.

Many factors influence how much hot water a solar water heater can provide, most particularly:

• the type and size of solar water heater used

• the climate at the site in question

• and the quality of the site as regards solar access

Whichever type of solar water heater system one uses, both utilize certain similar components, most notably: a collector and a storage tank.

The most common type of collector is a “flat plate” solar hot water panel – a weatherproof, insulated box made of aluminum or other metals that holds, beneath one or more transparent covers, an absorber plate.

When sunlight streams into the box, its heat passes through the transparent cover or covers and is soaked up by the dark plate which then transfers that collected heat through the heat-transferring fluids that flow through or past it.

A more expensive but often more powerful alternative to the flat plate solar hot water panel is a concentrating collector. These have the potential to produce much higher temperatures than flat plate panel solar water heater systems, although on cloudier days they can actually be less effective than their more economical counterparts.

Though storage tanks are not a required component of solar water heater systems, without them one can only utilize the solar power available in that given moment. With a storage tank, on the other hand, the solar water heater preheats the water and the tank maintains its temperature until the hot water is needed. A typical storage tank will hold enough heated water to provide for a single day's supply.

There are both 1- and 2-tank solar water heater storage tanks, the first housing its own backup electric heating element to reheat cooled water on cloudy days and during the nighttime, the second feeding into a conventional electric or gas water heater.

If you're considering installing a solar water heater of your own, you may be able to get a free energy audit to determine the potential cost savings you could reap. Whether you conduct one yourself or have it done for you, the energy audit must take certain factors into consideration, including:

• the ease or difficulty you'll have routing ducts or pipes from the ground floor or basement to the roof;

• whether sections of the wall will need to be opened up;

• if there's room on your ground floor or in your basement for a storage tank and how you'll be able to load it in (ie the width of stairwells and doorways) and set it in place;

• if your roof is accessible enough to install a panel on it and, if not, whether you have an appropriate site on the ground to put it;

• how well and how sturdily you can fasten your collector's supports to your roofing materials (for example, clay tile and slate can be more difficult to work with);

• how well you'll like the aesthetics of the system once it's in place.

For best results with your solar water heater:

• aim the solar hot water panel “true south” (as opposed to compass south);

• tilt it upward at a right angle to the sun;

• avoid shade (particularly between 9 am and 3 pm when the sun's rays are usually hottest);

• have a backup system in place for periods of excessive use and for off-peak solar accessibility hours.

A solar hot water panel installed properly should perform well for 15 to 20 years. And a solar water heater requires far less maintenance than its more conventional counterparts.