by Peter Buttrick | Nov 9, 2022
A major retrofit with an eye toward energy efficiency, including energy efficient heating, new windows, installing LED bulbs, improving insulation, replacing roofs and taking other actions to seal the thermal envelope can cut home energy use at least in half, according to an American Council for an Energy-Efficient Economy (ACEEE) study. Residential energy usage averages about 10,632 kWh annually per customer or a total of 21% of overall energy usage.
Deep retrofits would cut household energy use by 58% to 79%, depending on the age of the home, and there is an appetite for making retrofits in order to improve sustainability and energy efficiency. In a poll conducted by HomeServe on LinkedIn, 35% of those surveyed said they were considering replacing or upgrading their home’s insulation, matched by those who expressed a desire to install energy efficient windows, also at 35%, followed by those interested in upgrading to energy efficient heating, ventilation and air conditioning at 30%.
However, the average cost for these retrofits from to $42,600 to $56,750, according to ACEEE – an expensive proposition. In the HomeServe poll, only 15% said they expected to spend more than $20,000, while 25% said they’d spend $10,000 to $20,000, 27% would spend $5,000 to $10,000 and one-third said they planned to spend $5,000 or less on energy efficiency measures. There’s a clear gap between what respondents plan to invest and the investment needed to move the needle on sustainability and energy efficiency.
Additionally, energy prices are the highest they’ve been in more than 40 years, increasing by almost 16% for electricity and 33% for natural gas. Partly driving the cost was a muggy summer that resulted in a record use of residential power in the third quarter of 2022.
Those mounting costs could add to mounting utility debt – U.S. families have approximately $16 billion in utility debt, almost doubled from the end of 2019, with $792 the average amount owed. The National Energy Assistance Directors Association warns that, paired with the rising costs, continued high arrearages will continued to be accrued, despite the additional $4.5 billion added to LIHEAP as part of the American Rescue Plan Act.
In HomeServe’s poll, 53% of respondents said they were interested in making their homes more sustainable and energy efficient to save money on their energy bills, while another 25% said they wanted to help protect the environment and 23% wanted to increase their home value.
Rising energy costs and households struggling with being energy burdened may have influenced the energy efficiency measures poll respondents said they would like to incorporate into their homes – the majority, 60%, were considering rooftop solar panels, followed by a smart device to monitor their energy usage at 16%, a home electric vehicle charger at 13% and a home storage battery at 11%.
The largest energy consuming appliance in a home – and greatest opportunity to improve energy efficiency – is the HVAC system, which uses, on average, about 55% of a household’s energy. The HomeServe Advantage Program can help households across the market replace older, inefficient HVAC systems with high efficiency systems, all for one easily budgeted monthly subscription price. The program handles everything from home energy assessments and financing to installation and maintenance and repairs. Additionally, the installation includes a Honeywell T10 Smart Thermostat that uses a patented algorithm and local weather data to reduce runtime by 9% on average.
To learn more about how you can bring this affordable, energy efficiency program to your customers, contact us.
by Peter Buttrick | Apr 11, 2022
Low- and Middle-Income (LMI) households have historically faced obstacles to becoming more energy efficient, despite the outsized impact efficiency measures would have for this population.
Low-income households pay more than 7 percent of their income on energy bills, three times that of higher income households, and if LMI households could reach average efficiency, their bills would be reduced by a third. However, many LMI households don’t have the savings or the credit to implement energy efficiency measures and aren’t aware of programs and incentives that could make efficiency more affordable.
Programs like the Weatherization Assistance Program and Low-Income Home Energy Assistance Program are operated by different federal departments, and a lack of coordination between programs in some areas make it difficult for LMI households to apply or leverage the programs to the best advantage. For example, if a household is consistently applying for LIHEAP funds, it may be an indication that weatherization would help lower the overall energy bill. However, if the same entity isn’t administering both programs in the community, then that connection made not be made.
Program awareness is made more difficult through a lack of trust in low-income neighborhoods, where predatory financial lenders have made residents wary of free or low-cost measures and there is a reluctance to allow people from outside the community into their homes, said Tony Reames, director of the Urban Energy Justice Lab at the University of Michigan in Ann Arbor. Diversifying the workforce that conducts onsite energy efficiency measures and working with long-standing and trusted community partners, such as community centers or churches, is one way to elicit more trust and participation, he added.
Because of their struggles with affordability, one in five LMI households have reduced spending on food or medicine and 10 percent keep their homes at unsafe temperatures to reduce their energy bill. And, similar to food deserts, energy efficiency is often a costlier or more difficult to procure option in low-income neighborhoods than in more affluent neighborhoods. Many low-income communities have older homes that have not been updated because systemic policies such as redlining, resulting in housing stock that has poor efficiency.
Some states are addressing the financial obstacle by allowing on-bill financing or recovery, which allows rate payers to pay for efficiency upgrades over time, such as New York’s “bill neutral” program, established through the Green Jobs-Green New York Act and the Power NY Act. The two-tier program offers private market loans to those who can meet the credit requirements and a second, utility-financed tier for those who can’t. Those on the utility-financed tier also receive a lower interest rate, based on an area’s median income.
Oregon’s Energy Efficiency and Sustainable Technology Act offers a state loan program with an on-bill financing, that offers loans between $2,000 and $30,000 for efficiency and includes a free energy audit as part of the financing process. The Help My House program, launched by a group of South Carolina co-operatives with U.S. Department of Agriculture Rural Economic Development Loan and Grant Program funding, also utilizes on-bill financing to fund a whole-home energy efficiency approach. Those who participated in the pilot are paying off the 10-year loans through a surcharge on their bills. However, because they’ve saved so much through whole-home efficiency, there is an average $25 savings each month, even with the loan.
Legislators and regulators also expect utilities to include energy efficiency programs for LMI households in their portfolios. A partnership with HomeServe can help proactively address energy efficiency and safety for your LMI customers with a suite of optional home repair policies that cover every energy contingency, from gas lines to exterior electric to HVAC and water heaters.
LMI households will often not address maintenance and repair issues, even if it means their whole home systems are not working efficiently, because they can’t afford to address them. For example, an annual HVAC system tune-up can ensure that systems are working at an optimal level and that small issued are addressed before they become big problems. Water heaters also require regular maintenance and lose efficiency over time, with most having only a useable lifespan of only 10 years.
HomeServe policies can address all these issues for your LMI customers and help them keep their home energy systems in the best shape possible. For more information about how we can help your customers improve their energy efficiency, contact us.
by HomeServe USA | Jan 12, 2022
Heat pumps are misunderstood by many homeowners – many still believe that they do not adequately heat homes or know very little about them.
Heat pumps are more energy efficient, because they move warm air from one space to another instead of generating cold or hot air. They can save homeowners hundreds of dollars annually in HVAC and maintenance costs, while significantly reducing their carbon footprint. However, many homeowners are uncertain how heat pumps work and what benefits they can see from them.
Additionally, certain heat pumps – specifically ENERGY STAR-certified ones – can earn homeowners federal tax credits. Several states, local municipalities and utilities have additional initiatives to tempt homeowners to invest in a heat pump, but many homeowners aren’t aware of these benefits.
We turned to Don Johnson of Freedom Heating and Cooling in Birmingham, Alabama, to get a frontline view on how customers view heat pumps, from someone who is out in the field every day. Don is the president at Freedom, which has been serving northern Alabama since 2003, when Don’s father, John Johnson, first began operations. Don and Freedom joined the HomeServe team in 2020.
Don participated in a quick question-and-answer session to give a snapshot of how customers view heat pumps right now.
Q: If a customer is interested in energy efficiency or saving money, have they expressed interest in heat pumps?
A: Not usually.
Q: If you’ve suggested an upgrade/installation, have you encountered any misperceptions/confusion from customers? What were they?
A: Most misunderstandings are that a heat pump will not heat the house as well as a furnace. Older heat pumps were often thought to not be working because the air out of the vent was not as hot as a furnace. However, 95-degree air will warm a home, but will also “feel” cool as it blows over you.
Q: What are the most common concerns from customers about the installation of a heat pump?
A: Is it “right” for my home.
Q: Are customers generally well-informed?
A: No.
Q: Do customers understand what a heat pump is? If they don’t know, do you explain it to them or sell them something else?
A: We have to educate the benefits of lower gas bills with heat pumps, especially with dual fuel systems, which combine both gas heating and a heat pump.
Q: What are the top reasons customers list to have a heat pump installed?
A: Comfort, and humidity control is better with a heat pump than a furnace.
Q: What are the biggest obstacles to customers having heat pumps installed?
A: Electrical panel size and wiring are the biggest concerns. Proper size ductwork is more critical for a heat pump than a furnace or air conditioner.
Q: When you recommend heat pumps to customers, what benefits do you highlight?
A: Energy savings, comfort and better humidity through the winter.
Q: Are you seeing an increase in interest?
A: Heat pumps are more acceptable today than in the past.
Q: Any questions coming up frequently?
A: Will it heat my home as well as a furnace.
Q: How often do customers come to you with questions about heat pumps?
A: No; not often. We tend to bring up the subject.
Q: What makes the ideal customer or job?
A: Younger families with comfort concerns. Older individuals grew up with the blast of “hot” air and want that.
Educating homeowners about the benefits of a heat pump is an uphill battle, but partnering with HomeServe can help you take it on – we have a nationwide network of pre-vetted contractors who know HVAC and can help customers work out whether a heat pump is the smart move for their home.
HomeServe partners with utilities throughout North America to help educate their customers, shield them from the unexpected expense of emergency home repairs and make finding a reputable contractor easier. We have an optional warranty plan for all of your customers’ most vital whole-home systems, including HVAC, interior electric, interior plumbing and electrical and gas connections.
For more information on how we can help bring your customers peace of mind, contact us.
by HomeServe USA | Jul 13, 2020
Utilities put significant investment in energy efficiency programs, but only 40 percent of consumers participate in energy efficiency opportunities that would reduce their bill, even if they are struggling to pay their bills. Despite the sensibility of participating in an EE program, they often don’t resonate with consumers.
There’s a lot of noise for utilities to cut through to get consumers’ attention, and most utilities are not top-of-mind to begin with. Consumers may believe the obstacles to energy efficiency are too many or too difficult to overcome.
What if you could use behavioral science to decipher how and why consumers are making energy decisions? Levering human nature to encourage consumers to participate in EE programs can be more effective and less expensive than incentives or rebates.
With the data you already have on hand and simple tools, you can save terawatts and improve engagement by using proven behavioral science methods to inspire consumers to participate in energy efficiency programs.
“Saving Energy by Working with Human Nature” will give you the tips and real-world examples you need.
