Solar Water Heaters: What are the Benefits?

Dear EarthTalk: I heard that using a solar powered water heater in my home would reduce my CO2 emissions significantly. Is this true? And what are the costs?
-- Anthony Gerst, Wapello, IA
Conventional Water Heaters Use Energy
According to mechanical engineers at the University of Wisconsin’s Solar Energy Laboratory, an average four-person household with an electric water heater needs about 6,400 kilowatt hours of electricity per year to heat their water. Assuming the electricity is generated by a typical power plant with an efficiency of around 30 percent, it means that the average electric water heater is responsible for about eight tons of carbon dioxide (CO2) annually, which is almost double that emitted by a typical modern automobile.
The same family of four using either a natural gas or oil-fired water heater will contribute about two tons of CO2 emissions annually in heating their water.