Household hot water savings 'could be bigger than solar'

New Zealanders have an opportunity to save money on their power that's equal to the potential of solar, but they may not even be aware of it, one market commentator says.Powerswitch head Paul Fuge said hot water controls had the potential to benefit households significantly, if they were used well.He said New Zealand had had "ripple control" on hot water cylinders since the 1950s, which allowed lines companies to reduce hot water demand to stop lines overloading.New technology and smart meters were replacing that, and providing the benefit to households instead."There are a lot of plans that reward you for having hot water control,' Fuge said. "If you allow the network to control your hot water through ripple control, you can get a lower tariff on your hot water, or they might call it night rates or control rates."You can get a benefit there, but this [smart control] gives you more. It's significant, because if you look at hot water, it's about 30 percent of a household's costs."It's a really big area for people to save money."Power represents a significant cost to NZ households.Boris ZhitkovHe said the technology would allow consumers with time-of-use plans to heat their hot water overnight, when their power was cheaper."Your hot water cylinder only comes on during low-cost periods. If that's 30 percent of your cost and you're doing that at much lower electricity rates, that saves you heaps of money."People could install devices on existing hot water cylinders, he said, while newer hot water cylinders might have the functionality built in. Some power companies were also offering it for customers, via their smart meter connections.Fuge said his own hot water cylinder came on at 10pm and the water would stay hot."There is no downside to heating up at night."If people are looking to save money, buying a hot water heat pump and controlling it for low-cost electricity rates... you can really make a big dent in your household electricity costs."I always say, for a lot of people, for a lot of large households, it's probably more than solar."It's a more surefire way of saving money, I believe, for many households, large households with kids, who are using a lot of hot water. It could make a bigger impact than putting solar on."New Zealanders have an opportunity to save money on their power that's equal to the potential of solar, market commentator Paul Fuge says.DmitryMoHe said having solar as well would be ideal, because the water could be used as a type of battery for the solar system."You can use the technology to make sure you're heating up your hot water with any excess solar, rather than putting it back into the grid at a lower rate."EECA research, evaluation and insights lead adviser Gareth Gretton said his organisation had looked at hot water as part of wider research into demand flexibility."With smart devices for controlling loads in houses and businesses, there's more opportunity to do smart things," he said. "You could have a situation where, if the wind is blowing and the sun is shining, you could be turning hot water cylinders on and potentially warming them a bit hotter than they normally would sit, because at times when renewable energy is plentiful, it's a bit of a case of use it or lose it."It's a really big opportunity. Hot water is a surprisingly large amount of our residential demand, indeed our electricity demand as a whole."Simply heating hot water in houses is something like 10 percent of New Zealand's electricity use."Smart meter provider Bluecurrent said - on 7 August, winter's coldest day this year - 100,000 hot water cylinders with smart meters shifted 81.2MWh of power away from the evening peaks, saving an estimated $77,000 to $100,000 in wholesale costs.It conducted a survey that found 85 percent of people did not know the technology existed. Most were open to more hot water control, but wanted assurance there would be a real saving.Bluecurrent chief customer officer Matt Bostwick said households with their hot water controlled by power companies used 10 percent less power than those without."There are lots of ways that the dynamic control of hot water heating can save households money. We've done some research looking at the drivers for New Zealand power consumers - what would motivate them to participate in hot water load control."Of course, the N o.1 thing was, 'If it saved me some money, I'd be up for it'."Really interestingly, nearly 20 percent - one in five - said, 'If I knew I was contributing to making the energy system more sustainable, I'd be up for participating in that as well'."He said many more households could start making better use of their hot water control."Some 1.4-1.8 million homes today have a hot water cylinder, and it doesn't matter whether you're the home owner or a renter, you still get the opportunity to participate in that, because the key element - the hot water cylinder - is already there."We just have to get them connected and activated and turned on."Sign up for Money with Susan Edmunds, a weekly newsletter covering all the things that affect how we make and spend money