Chile has three mechanisms to encourage installing solar water heaters (SWHs) for residential water heating:
- a tax exemption for SWH installation in new housing (from 2017)
- a subsidy to incorporate SWH into housing reconstruction programmes (2014-17)
- Ministry of Housing and Urban Development (MINVU)'s Family Heritage Protection Programme for existing public housing (from 2011).
With these measures, more than 90 000 homes have hot water supported by solar thermal systems.
Tax benefits for installing SWHs were initially granted from 2010 to 2014, and the programme was extended until 2020. The benefit applies to new houses and apartments with SWH installed between 1 January 2015 and 31 December 2020 in accordance with the technical requirements set by law and having a municipal acceptance certificate.
Construction companies can deduct the cost of the SWH, its installation and five years of maintece from their income tax or any other tax.
The tax benefit varies according to the value of the dwelling (land + construction costs):
- less than 2 000 UF,5 the benefit covers up to 100% of the investment.
- between 2 000 and 3 000 UF, a linear decrease of the benefit from 100% to 0%
- more than 3 000 UF, no tax benefit.
The level of tax benefit per housing depends on the size of the solar thermal system: the benefit is the biggest for the smallest systems. The level of the benefit declines each year between 2015 and 2020.
In response to housing reconstruction needs because of the natural disasters that occurred in 2014 and 2015, the government introduced a subsidy for the installation of SWH as part of the housing reconstruction programme. In total, some 5 200 buildings received the subsidy.
For existing public housing, MINVU and the Ministry of Energy have created a subsidy for the installation of SWH. From 2011 to 2015, the subsidy was granted to 28 000 buildings.