Solar panels
Solar panels do not generate electricity, but rather they heat up water. They are often located on the roofs of buildings where they can receive heat energy from the sun. The diagram outlines how they work.

A pump pushes cold water from the storage tank through pipes in the solar panel. The water is heated by heat energy from the sun and returns to the tank. In some systems, a conventional boiler may be used to increase the temperature of the water.

Advantages
Solar energy is a renewable energy resource and there are no fuel costs. No harmful polluting gases are produced.

If oil costs £1.00 per gallon, a solar domestic hot water heater will save enough money to yield about 10% annual return on the investment (tax free). If the cost of oil goes up in the future either because of inflation or escalation, the return on the solar investment will go up as well.