Solar water heater is a good investment; pays back in 6 years

By MUNGAI KIHANYA

The Sunday Nation

Nairobi,

30 March 2025

Michael Mulama is wondering whether he made the right decision by installing a solar water heater in his house. He writes: “in early 2023, I got a solar heater installed at accost of Sh130,000. Before the installation, I was using instant hot showers and my average electricity bill was about Sh8,000 and now it is down to about Sh7,500. If I am saving just Sh500 per month, it means that it will take more than 20 years to recover the investment. Was this a wise move or am I missing something?”

I asked Mulama to share his electricity bills for 2022 and for 2024 and, thanks to modern technology (bills are sent by SMS), he sent me all of them for the two separate years. It is true that, in 2022, his average bill was Sh7,691 and in 2024 it was Sh7,500. However, in 2022, he consumed a total of 3,885kWh (kilowatt-hours) while in 2024 the consumption was 3,112kWh. This is a 20 per cent drop in the amount of electricity and a 2.4pc drop in cost.

The reason why the drop in the consumption is much larger than the drop in cost is that, sometime in late 2023, the price of electricity was increased. We can see this clearly if we work out the average unit cost for the two separate years. For 2022 it comes to about Sh24 while in 2024 it was about Sh29 – a Sh5 increment.

If there had been no increment, Mulama’s annual cost of electricity in 2024 would have been Sh24 times 3112, equals Sh74,688; which works down to an average of Sh6,224 monthly. Therefore, he would have been saving almost Sh1,775 every month. This way, his solar water heater would pay back through savings in about 6 years. Now this is encouraging!

We can do the calculation from a different angle by asking how much Mulam would be paying for electricity at current rates if he didn’t have the solar heater. Before the installation, the annual consumption was 3,885kWh. At the current rate of Sh29, this would have cost him Sh112,665, or about Sh9,389 per month. But he is paying Sh7,500 with the solar heater installed, so, he is currently saving Sh1,889 monthly.

Therefore, at the current price of electricity, Mulama recoups the cost of solar heater installation in fives years and nine months. Two years have passed since 2023, so he now has just about four years to go and the entire cost will be recovered. Mulam: this was a good decision!