Experience with a large number of installed solar energy systems in the HUD Solar Program has shown that a variety of problems and design/installation errors have occurred in many solar systems, sometimes resulting in substantial additional costs for repair and/or replacement.

In this paper, the effect of problems and errors on the economics of solar energy systems is examined. A method is outlined for doing this in terms of selected economic indicators. The method is illustrated by a simple example of a residential solar DHW system. An example of an installed, instrumented solar energy system in the HUD Solar Program is then discussed. Detailed results are given for the effects of the problems and errors on the cash flow, cost. of delivered heat, discounted payback period, and life-cycle cost of the solar energy system. Conclusions are drawn regarding the most suitable economic indicators for showing the effects of problems and errors in solar energy systems. A method is outlined for deciding on the maximum justifiable expenditure for maintenance on a solar energy system with problems or errors.