The average U.S. household will spend about $2,160 this year on home energy, which is $60 less than in 2009, according to the Alliance to Save Energy.
While the drop is good news, $2,160 is still a lot of money to spend on gas and electricity, and it can be cut by up to 30% by using efficient Energy Star products built to save energy, according to Ronnie Kweller, director of media relations at the Alliance to Save Energy. Since major appliances use the most energy in a home, they're the best place to look to save money.
Start with how you heat and cool your home. Almost half, 47%, of the $2,200 it took to power a typical American home in 2009 is from heating and cooling. According to a 2009 study by Lawrence Berkeley National Laboratory, here's how the average annual utility bill is broken down by appliance, along with some tips I've collected on how to lower costs:
1. Heating: $662
A home's heating, ventilation and air conditioning (HVAC) system is the worst offender, especially during the winter. The best way to save money here is to insulate and seal all ducts and air leaks so your money isn't flying out the window, or a crack in the window. A home can save 20% on its heating and cooling bills by sealing holes, Kweller said. Other things to do include having the equipment serviced each year, replacing air filters every three to five months, and installing a programmable thermostat to turn down the heat while you're asleep or at work.
2. Cooling: $394
The same rules apply here as for heating, so insulate, seal ducts and cracks, and use a programmable thermostat. If you have a central air system, clean the ducts periodically. For a room air conditioner, be sure the window unit fits tightly so outside air isn't getting in. If replacing windows, choose Energy Star qualified models designed for your area, and save $20-$95 each year in energy costs, according to EnergyStar.gov, a U.S. Department of Energy website.
Federal tax credits that are worth 30% of the cost of each improvement, up to a cumulative total of $1,500, are available through the end of 2010, so now may be a good time to replace an aging HVAC system or do other home improvements to save energy. Eligible products fall into two basic categories: the "building envelope," which includes windows, storm windows, storm doors, certain types of roofs, and insulation and sealing products such as caulking, weather stripping, and foam sealants; and highly efficiency heating and cooling equipment, including furnaces, boilers, heat pumps, water heaters, and central AC system. Installation costs are NOT covered for building envelope products but are covered for heating and cooling equipment.
3. Water heater: $317
A water heater uses 14% of an average home's energy costs, working around the clock to heat water for clothes, dishes and showers. A new, energy efficient water heater can cut the water heating bill in half. When replacing water heaters, consider a tankless model that only heats water on demand – particularly if you have natural gas available.
Setting the water heater thermostat to 120 Fahrenheit or lower will save money by reducing standby losses (heat lost from water heater into surrounding basement area). Using less hot water will also save money. If set too high, or at 140 degrees Fahrenheit, your water heater can waste anywhere from $36 to $61 annually in standby heat losses and more than $400 in demand losses, according to the DOE. If you have an older water heater, you can improve its insulation by wrapping it with an insulating jacket and save more than $30 per year in excess heat loss.
4. Lighting: $269
This makes up 12% of an energy bill. The Environmental Protection Agency estimates that if every U.S. household replaced just one traditional light with an Energy Star-qualified bulb, America would save enough energy to light 6 million homes, save $600 million in utility bills, and reduce enough greenhouse gas emissions to equal the removal of 1 million cars from the road. Compact fluorescent light bulbs use less energy and last up to 10 times longer than standard incandescent light bulbs, saving money on energy bills and replacement costs.
5. Clothes dryer, washer: $143
Major appliances account for about 13% of a home's energy use, with a clothes washer and dryer the largest consumer at 6%. Many states have sales tax holidays this summer, making it a good time to buy energy efficient appliances such as washers. Washing full loads of laundry in cold water is a good start to saving money, saving more than $40 annually from an electric water heater and $30 from a gas water heater. An energy efficient washer will wring more water out of clothes, cutting drying time in half.
The dryer uses more energy, so using it less will save more. Moisture sensors will turn off a dryer as soon as the clothes are dry, preventing the common problem of over-drying clothes. As your mom probably told you, clean the lint trap before every load, which will increase drying efficiency.
6. Refrigerator: $95
Using 4% of a home's annual energy doesn't sound like much, but it's still money out of your pocket that can easily be reduced. New energy efficient models are so much better than old ones. Even though new ones are bigger and have more features, they still use much less energy than older models. "If it's 10 to 15 years old you are losing money all the time you are running it," Kweller said. And buying a new one, but putting the old one in the garage and plugging it in, negates the savings. A refrigerator retirement savings calculator can help determine how much yours costs to run.
Keep it at 35 to 38 degrees Farenheit, allow air circulation behind it, minimize the amount of time the door is open, keep the fridge full so it won't lose as much coolness when the door is opened, and check the gaskets around the door. If a piece of paper can easily be pulled out with the door closed on it, the gaskets may be worn and need to be replaced.
7. Electric oven: $90 per year, although this figure isn't from the Berkeley study but from an energy use website. Annual cost is based on using a 350-degree oven for one hour per day. This is a rough estimate and may be much lower if you don't use the oven as much.
All else being equal, an oven with a self-cleaning feature will tend to be better insulated and thus more efficient than one which does not, according to the Alliance to Save Energy. Also avoid excessive use of the self-cleaning option, put lids on pans, and use range burners that are the same size or slightly smaller than the pan being used. Also, replace electric ranges and ovens with gas ones if possible, and avoid gas ovens and ranges with continually burning pilot lights.
8. TV, DVD, VCR: $57
These add up to 3% of a home's energy use. One easy way to save electricity is to plug them all into a power strip and then turn the strip off when they're not being used, since standby mode can still use several watts of power. There are devices that will tell you how much energy is being sucked by things you thought were "off."
9. Dishwasher: $49
Dishwashers are 2% of a typical utility bill and are another easy area to cut. Rinsing dishes can use up to 20 gallons of water before the dishes are even loaded, according to the DOE. Just scrape food off dishes, since Energy Star qualified dishwashers and today's detergents are designed to do the cleaning so you don't have to. Dishwashers use about the same amount of energy and water regardless of the number of dishes inside, so run full loads whenever possible. And turn off the heat drying.
10. Computer: $28
Using a computer and monitor make up 1% of a utility bill. Simple tips include using a power strip that is turned off when not in use, and turning off the computer when it won't be used for more than 30 minutes. When looking to buy a new computer, remember that laptops use significantly less energy than desktop models, and LCD flat panel screens use less energy than the bigger CRT displays.
Aaron Crowe is a freelance journalist in the San Francisco Bay Area.
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