Abstract: This paper aimed to explore the impact of income on the application of low\|carbon product in China， and non\|linear income effect was revealed by panel threshold model. Based on provincial panel data during 2004\|2010， this paper analyzed the influencing factors of solar water heater application in rural China using cross\|sectional consistency estimator. Through establishing panel threshold models， structural changes on income effect affected by natural and social economic factors were analyzed empirically. Results showed that besides income level， energy endowments， housing conditions and population mobility could also affect the application of solar water heater directly. When energy endowments， educational level， population mobility， and temperature overtook their corresponding threshold values， the income effect would experience structural change nonlinearly. Therefore， it was beneficial to improve peasants housing conditions， cultivate their energy\|saving and low\|carbon awareness， and strengthen propaganda of low\|carbon product to promote the application of solar water heater in rural China. All the suggested measures should be in accordance with rural population mobility and temperature characteristic in the process of raising peasants purchasing power.

Key words: low\, carbon product, renewable energy, solar water heater, income effect, threshold regression