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April 22, 2015

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Jim Patterson


Whether you're a homeowner, a renter or a business owner, and regardless of the energy source you rely on for heating, cooling and lighting, there is one simple way to save on your energy bill: Use less energy. To help you do so, this issue of Kiplinger's Energy Alerts (issues are free through June 9) outlines ways to shave your utility costs, from making quick and easy changes to investing more substantially in energy efficiency.

Small Steps to Save $$

In our digital age, home and office electronics gobble more and more of the electricity we use -- even when our devices are off. The American Council for an Energy-Efficient Economy (ACEEE), which encourages energy-saving practices and advocates for tighter efficiency standards, reckons that the electronics in an average American home draw about 50 watts of power when turned off or left in standby. That doesn't sound like much, but it adds up to 440 kilowatt-hours per year. Since the average electric rate paid by households in America was 12.5¢ per kilowatt-hour last year, that works out to $55 per year in wasted energy.

Luckily, it's easy to keep some of that money in your pocket. Unplug appliances and devices you rarely use -- say the TV in the guest bedroom that's rarely watched. And plug items you do use frequently into power strips that can be turned off by flipping a single switch. If you have a home office with a laptop, a printer and computer speakers, for instance, keeping them truly "off" when not in use saves about 9 watts of power.

Don't overlook easy steps to save a bit on heating and air-conditioning, too. Remember to change the filter on your furnace, AC or heat pump. The system has to work harder to circulate air through a dirty filter, thus wasting energy.

Consider dialing down the temperature setting on your water heater. An easy way to check: If your hot water tap runs more than 120 degrees on a kitchen meat thermometer, your heater is probably set too high, says ACEEE research analyst Rachel Cluett. Also, use the "low" or "vacation" setting when you're away for several days. (No sense heating water you won't be using, right?) And if you have an older water heater with fiberglass insulation instead of more-modern foam, pick up a water heater insulating blanket from the hardware store.

Thinking Bigger

To trim your energy costs further, you'll likely need to invest more time and money.

Take lighting, for example. The federal Energy Information Administration estimates that lighting accounts for 15% of the electricity consumed by both homes and businesses. More-efficient lighting products hold big potential savings. Both compact fluorescent bulbs and light-emitting diodes use far less energy per unit of light output than do traditional incandescent or halogen bulbs.

But are the up-front costs worth the long-term energy savings? A CFL bulb that mimics the light output and shape of a 60-watt incandescent can cost a few dollars. An equivalent LED can easily run $10 or more.

To earn back that investment quickest, install high-efficiency bulbs in the fixtures you use the most. (And bear in mind that CFL bulbs generally aren't dimmable, so they won't be suitable for every fixture.) To gauge the time required to break even on your up-front expense and start saving on your electric bill, use a calculator such as this one. You can input the prices of two different types of lightbulb (say a traditional incandescent versus an LED), how many hours the bulb will work every day, and how much you pay for electricity.

For instance, swapping a 60-watt incandescent bulb for a nine-watt LED that costs $10 and runs four hours a day, at an electric rate of 12¢ per kilowatt-hour, will break even in about 13 months and then save the user $9 per year. (It helps that LEDs generally last much longer than traditional bulbs.) Multiply that by a dozen or more bulbs, and the annual savings start to look sizable.

When It's Good to Get Audited

For a more general approach to saving on your energy bills, consider calling in a pro to perform a whole-house energy audit. ACEEE's Cluett, who used to perform these inspections for homeowners in Maryland and Virginia, says the idea is to identify where your home is losing heated or cooled air – letting you target insulation and air sealing to the places that need it most.

To find a qualified auditor, check with your state energy office or your utility. One or the other should be able to recommend experienced auditors in your local area and can also tell you about any incentive programs from your utility that might pay for some or all of the inspection. Cluett says a typical home audit costs roughly $400, but rebates from the utility could trim that significantly.

Insulating and air sealing a home aren't cheap. But the payback can be substantial, assuming you plan to live in the home long enough to reap the benefits. The U.S. Department of Energy says that proper insulation and air sealing yields a 15% saving on the average home's heating and cooling bills.

Businesses with large facilities can expect to pay much more for a customized energy audit. But note that many utilities will pay for part or all of the expense if the firm adopts the energy-saving recommendations generated by the audit.

Cooling Your Summer AC Bills

If you live in a region with hot summers – or hot weather year-round – your air conditioner probably adds a hefty amount to your electric bills. ACEEE estimates that cooling accounts for 17% of residential energy bills (second only to heating, at 26%). So helping your current AC run more efficiently, or upgrading to a new unit, has the potential to save you some real money.

Wes Davis, vice president of quality assured programs at the Air Conditioning Contractors of America, says there are a few things consumers can do to make sure their systems are running at peak efficiency. Aside from replacing dirty air filters regularly, he recommends gently washing the aluminum fan blades in the outside compressor unit with a garden hose to remove debris so the fan can move air as efficiently as possible.

Need to replace your air-conditioning unit because it's on the fritz, or nearing the end of its useful life (roughly 20 years)? Ease the hit to your wallet by springing for a highly efficient new unit that will lower your future electric bills. Davis says that the best ACs available today are about 60% more efficient than the units commonly installed two decades ago. He recommends models with variable speed motors, which let the system throttle back when less than full cooling is needed.

But whatever type of air conditioner you buy, the key to maximizing its efficiency is proper installation. Davis says most brands on the market today are reliable – what matters is selecting a system that is the right size for your home and making sure that the ducting is well insulated and sealed. So seek out a good contractor to do the job (interview a few of them, and use this ACCA checklist to ask them the right questions). "This isn't like buying a refrigerator at the big-box store," Davis says. Getting the installation right is essential to keeping you cool, and to saving you money.

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Jim Patterson

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P.S. Remember, you have a standing invitation to e-mail me anytime with questions on any aspect of energy you're interested in -- no matter how large or small the issue -- and I'll run down the answer for you. Replying to individual reader queries -- at no extra charge -- is a long-standing tradition with The Kiplinger Editors. We've always been more than just a group of publications -- we're a service.

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