Solar water heating uses energy from the sun to collect heat, instead of electricity, which is used to heat water for bathing, radiant heating systems, and more. Heating water with a gas or electric hot water heater accounts for a large portion of energy costs in Hawaii. Solar water heating can provide most of a business or household’s hot water needs, cutting monthly energy bills by about $100 for the average household and even more for those using electric (not gas) hot water heaters. For households on Kauai and Oahu, residents may qualify for both a 26% Federal tax credit and a rebate from Hawaii Energy of up to $2,250. The installation of a solar hot water heater typically pays for itself after an average of about two to three years.