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Module
Attic Air
Discharge
New Duct
Technology
Domestic
Hot Water
SolarAttic has patented the heating of domestic hot water using solar generated hot attic air.
Three of the Company's patents apply to heating hot water: U.S. Patent 5,014,770; U.S. Patent
5,452,710; and U.S. Patent 5,746,653. All three patents are technology patents. In combination,
they provide the basis for creating a system that provides free domestic hot water. In some
geographical areas, this can be a significant market. The Company has already received many
product inquiries regarding this new hot water technology and believes there is strong market
interest for such a product. To date, the Company has not had the resources to complete the hot
water products. See “MARKETING AND SALES” & “RESEARCH AND DEVELOPMENT.”
Two amperes of electrical current or 400 watts of power for the pool heater appears to be the
typical upper limits of current and power consumption that SolarAttic is using in residential attics.
The exception would be a large space heater blower unit moving more volume of air in larger
homes. For the ridge ventilator and domestic hot water heater, 1 1/2 amperes of electrical current
and 180 watts maximum of power would appear to be the normal expected maximum energy
consumption. This low amount of electrical current and power consumption allows SolarAttic’s
systems to be easily powered by photovoltaic cells (PV Cells).
The Company believes that its future systems will provide free space heating, free domestic hot
water heating and free ventilation when powered with PV cells. Free in this context means free
from any utility company power connection and/or energy consumption (monthly cost).
The Company has had no significant product warranty costs related to any of its products and
does not maintain a warranty reserve, inventory or budget. Warranty costs would include parts
replacement, service, etc. Additional product information is available on the Internet. This
includes a comparison to solar panels and full-page product testimonials from satisfied customers.
SolarAttic's technology is not a panacea that eliminates all solar panels. There are certain cases in
which solar panels might be more effective. However, the Company believes that in the majority
of competitive solar situations, that its products will be preferred specifically because there are no
solar panels. Other product information may be found at http://www.solarattic.com/products.htm.
In General. Many of today’s heating system consumers are concerned with the impact their
heating system may have on the environment. The Company believes that this concern for the
environment creates a market receptive to environmentally sound, renewable energy sources such
as its products and traditional solar heating systems. One barrier to market acceptance, which
traditional solar heating systems have encountered, is the necessity of installing solar panels. The
Company believes and market information indicates that more heating system consumers would
purchase solar heating systems if such systems did not require users to install solar panels—which
have been called “ugly and obtrusive” by some consumers. The Company’s technology and
products provide solar heat without panels and thus, the Company believes, will resolve
consumers’ aesthetic concerns and overcome the market barrier encountered by traditional solar
heating systems. Market data indicates that over 90% of solar panels sold for use in thermal
heating applications are now used to heat swimming pools. Aesthetics are a major issue.
Based on data in a 1987 industry study sponsored by the National Pool and Spa Institute, the
Company estimates the swimming pool heater market to be at least $195 Million at retail.
(In millions of dollars)
Solar Panels
Heat Pumps
Electric
Fuel Oil
20.5
8.3
6.1
2.8
29.8
12.0
8.9
4.0
50.3
20.3
15.0
6.8
25.8
10.4
7.7
3.5
$79.6$115.3
* Pool heaters sold after the initial pool purchase.
(In units sold)
Solar Panels
Heat Pumps
Electric
Fuel Oil
6,849
2,366
4,234
1,121
9,917
3,428
6,167
1,600
16,766
5,794
10,401
2,721
12.0
4.2
7.4
2.1
56,91082,374
* Pool heaters sold after the initial pool purchase.
The majority of pool heaters sold are fueled either with natural gas or propane gas. Solar panel
systems rank second, both in terms of dollar volume and units sold. Less than half (43.4%) of
new pools built come equipped with pool heaters, which may explain the large number of heaters
that are sold in the after market (after the initial swimming pool is purchased).
The Company’s own market research regarding residential pool heating systems reveals the
following factors: A) Pool owners object to the high costs associated with heating their swimming
pools. B) Most homeowners don’t like the appearance of solar panels and some communities
object strenuously to solar panel systems. C) Consumers are looking for ways to save money. D)
Consumers are interested in environmental and health-related issues. E) CFC or HCFC chemicals,
which are used in pool heat pumps, are an environmental problem and the use of these chemicals is
being phased out internationally. G) Concerns over air pollution is causing some California locales
to require the use of solar energy for pool heating. H) Higher energy and fuel taxes make
renewable solar energy more attractive. I) Restrictive building covenants in various locales prevent
the use of roof-mounted solar panels. The Company believes that its products respond favorably
to each of these factors.
Pools are frequently sold with the idea that no heater is required. Generally speaking, a non-
heated pool, with few exceptions, has limited recreational value to its owner. In northern tier
states, for example, a pool owner can only depend on approximately two weeks in the middle of
summer when the pool will be warm enough for swimming (80-84º F) without a pool heater. This
may be another reason for the high level of after market sales of pool heating systems.
The Company estimates that the SolarAttic Pool Heater can operate from April to September in
Minnesota. Longer operating seasons exist in more temperate climates. In South Florida, for
example, the Company believes its pool heater could be used year around, especially if the pool
owner has a spa attached to the pool. According to market data, approximately 25% of new pools
may have attached spas. In these installations, when heat is not required for the pool in the hot
summer, it can usually be used for the spa since spa water is typically kept much warmer than pool
water.
The global market for solar space heating systems is substantially under-addressed and
undefined. Solar space heating data is sparse and confined only to solar panel sales. As such, the
existing data for solar space heating is not meaningful to the Company. The Company believes its
SolarAttic space heater represents a significantly new product category in both solar space heating
and conventional space heating markets.
According to Manufacturing U.S.A.(1992), U. S. manufacturers of hot water heaters ship
over $393 Million worth of electric hot water heaters annually.
This is the market the Company has targeted to introduce its domestic hot water heating system
into when it becomes completed. When used in concert with an electric water heater, the Company
believes its water heating system will lower the cost of electric domestic hot water. The Company
believes that this reduction in electric hot water heating costs can be dramatic and may exceed 90%
in certain situations. The Company believes that the cost savings possible with electric hot water
heaters does not exist with gas heaters. However, if the Company succeeds in substantive
reductions in the cost of heating water electrically by using hot attic air (heat energy), the Company
feels that this could be an attractive alternative to gas water heaters. Consumers have expressed
concerns about the explosive potential of using gas heaters. If the economics of using the two
heaters could be equalized, the resulting market forces may cause a paradigm shift.
If the Company successfully develops its domestic hot water heater, the domestic hot water
heating system will be effective from only a few limited months of operation (estimated to range
5-7 months in Minnesota) to possibly year around (as in some areas of Florida).
In Minnesota and other colder climates, the domestic hot water system would begin to preheat
water in the Spring (March-April). As the year progresses, the Company expects its domestic hot
water system would provide a substantial part of, if not all, of the domestic hot water heating needs
for the typical home. This could be expected during the months of May to September. Sometime
in September or October, the heater would fall back to a preheat mode. By November and through
the months of February, the system would fall back on the electrical heating elements normally
supplied in an electric domestic hot water heater.
In Florida and other warmer climates, the results could be year around heating of domestic hot
water. Such a system may see very little fall back onto the electrical elements of the electric water
heater. The system could conceivably function without electrical backup altogether and be
powered exclusively by PV (photovoltaic) cells. In such case, free domestic hot water would
become a reality. See “PATENTS & INTELLECTUAL PROPERTY” and “PRODUCTS.”
Regardless of the geographical area, the Company believes that, when the SolarAttic water
heater is used in concert with a traditional electric hot water heater, the combined results will be a
significant reduction in the costs of heating hot water with electricity. Electric domestic hot water
tanks typically have two 4500-watt elements, which could turn on consuming electrical energy at
the rate of 9000 watts per hour. At 220 volts a-c, these two heating elements could demand 40
amperes of electrical current from the power plant. In a SolarAttic domestic hot water heater, the
Company expects to supplant the two 4500 watt elements with a simple fan and recirculating pump
both of which may only demand a maximum combined current of 1 ampere or less. The
Company’s third U.S. Patent discloses how to create free domestic hot water using hot attic air.
See “PATENTS & INTELLECTUAL PROPERTY.”
The reduction of electrical consumption and its utility load impact could be a significant
marketing factor for the Company depending upon geographical area. For illustrative purposes,
consider Florida Power & Light (FPL) based in Miami, Florida. FPL has an estimated 2,500,000
residential customers with electric domestic hot water. Every one of these customers could be a
candidate for the Company’s new hot water technology. If the Company’s technology can be
successfully demonstrated to FPL, the utility itself may help promote it as a load demand side
management (DSM) technique.
Consider these energy dynamics that are already at work in just this one utility company.
Customers returning home late in the afternoon start increasing their electric load demand. This
includes making dinner, washing clothes, turning the television on, air conditioner on, etc. Utility
loads start to peak. At any given moment, depending upon local hot water needs, any number of
the 2,500,000 electric hot water heaters could add their demand into FPL’s load. The Company
currently has an estimated 13 power plants. Daily consumption of power for residential hot water
is estimated at 470 Megawatts. This is the equivalent output of three coal-fired power plants in
FPL’s inventory. The Company notes the difficulty that utility companies are now encountering
with the idea of building new power plants especially with environmental groups. The Company
also notes that it may be more beneficial to reduce demand than to build a new power plant.
SolarAttic’s water heating technology offers utility companies another option.
Most utility companies are already endorsing conservation and other energy saving techniques
such as DSM. They have found this to be a more profitable long-term strategy than simply just
building to increased electrical load demand. Many utilities now offer rebates on energy saving
appliances. Some utility company marketing efforts include stuffing customer utility bills and
receiving direct product rebates from those manufacturers whose products they promote.
Coincidentally, as the load peak cycle occurs for FPL, maximum solar radiation is occurring
and maximum attic temperatures are being reached. In this one particular utility’s area, the
Company believes that an estimated 90% or more of the power currently expended for domestic
hot water can be eliminated if the Company’s hot water technology was deployed on a system wide
basis.