A solar hot water system is really quite simple. You're using the sun's energy to heat a solar collector full of solar fluid (or water, depending on which type of system you install), which then transfers that heat (or hot water) into your home's hot water tank.
(1) When there is sufficient heat to be drawn from the collectors, a controller automatically activates pumps. (2) Heated solar fluid is then circulated from the collector, (3) through a heat exchanger where its heat is transferred to (4) water in the storage tank. (5) The solar fluid is then pumped back to the collector to once again be reheated. This circulation loop will continue as long as there is heat to be drawn from the collector. During times when there is little or no sun, a backup heating system will be activated to provide adequate hot water.