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Top Energy Saving Investments

Each year on April 22nd we celebrate Earth Day. While a day of celebration is great, Earth Day should really be everyday. We are going to stop and take a look at some of the top energy saving investments you can make and put real numbers behind them.

Whenever you talk about energy saving investments there is a tendency to jump right to the investment part. It is true in some cases the upfront cost is going to be high, but not always. You have to weigh all factors – cost, how long are you planning to live there (2 years, 10 years, 50 years….) and so on. Armed with that info, lets jump into it.

  1. Light bulbs. Here is an easy one with a small upfront cost. Changing a 60-watt incandescent bulb to an 8 watt LED bulb. For our comparison we are going to use a bulb that you would have on for approximately 5 hours a day. A 60-watt bulb will use 0.3 kilowatts per day. At $0.13 per kilowatt (average for the US at the time of this post), that is $14 per year that bulb costs. Now use those same numbers but with an 8 watt LED and the cost is $2 per year. Currently a 60-watt bulb costs about $1.00 while a LED is about $2.00. So with our math the payback for switching to an LED is about 1 month. As an added bonus LEDs can last 5 to 10 times longer than incandescent. These numbers are for one bulb, now times that by the amount of bulbs you have in your home.
  2. Water Heater. This is a bigger one and one that is best done when it is time to replace it. We are not suggesting ripping out the one you just put in 2 or 3 years ago. We are going to compare a 40-gallon standard electric water heater to a high efficiency unit with a heat pump. A standard water heater is approximately $500 for the water heater itself. A high efficiency version is about $1,150. The upfront cost is going to be considerably higher but lets look at the numbers. The average electric cost of a standard unit is about $30 a month or $360 per year. A high efficiency unit is about $12 a month and $144 per year. So right there you are saving $216 per year. That would make up the difference in cost in just over 3 years. The standard life expectancy of a water heater is 10 years. It gets even better. Currently many utility companies and states are offering rebates for high efficiency units. You might be able to make up the difference in cost immediately depending on how much the rebates are.
  3. Cars. Everyone always wants to know about cars. Is it worth getting a hybrid or an all electric? As with many decisions there isn’t one clear answer. We took a major car brand and compared the standard model, hybrid and electric versions. All calculations are based on 12,000 miles per year and $3.00 per gallon of gas. We also based everything off the MSRP of the car and did not factor in any rebates or tax credits that may be available for electric cars. Unfortunately we are not going to give you a yes/no answer, but here are our calculations that will hopefully help guide you: Standard model price $25,000, 32 MPG. Hybrid model price $26,500, 48 MPG. Electric model price $33,500. Breaking this down:
    1. Standard: 12,000 miles divided by 32 = 375 gallons of gas. 375 times $3.00 = $1,125 per year for gas.
    2. Hybrid: 12,000 miles divided by 48 = 250 gallons of gas. 250 times $3.00 = $750 per year for gas.
    3. Electric: $0 per year for gas.
    4. Conclusion: Based just on price you can make up the difference in cost between a standard model and hybrid in about 4 years. For a fully electric car it is about 7.5 years (this can be greatly reduced if rebates or tax credits are available). There is also the environmental benefit of reducing the carbon output from your vehicle. Going from a 30 MPG car to an electric can save about 12,000 lbs of green house gases per year.
  4. Programmable thermostat (or smart thermostat). These are a great and simple way to reduce your energy usage. Depending on you work and living habits, you can save between 10% and 30% on your heating and cooling a year. If your average cost is $100.00 per month, that is a $10.00 savings per month. Now factor that a programmable thermostat or a smart thermostat is going to cost between $60.00 for a standard one and up to about $200.00 for a more advanced one, it could pay for itself in one to two years. Some local utility companies offer discounts or rebates on these as well.

Hopefully this gives you some “real world” information about energy saving investments you can make while still making the costs make sense. When all the numbers line up; it is a win for the environment, a win for you and a win for the future. To learn more about saving energy, visit or the climate change section of this website.

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