Energy Efficiency Pays Best

In some parts of the Northeast, the skyrocketing cost of oil could cause residential winter heating bills to climb as high as $7,000. Oil reached $145 a barrel in late May, and many analysts are predicting $150-200 per barrel oil within two years. With heating oil averaging $4.71 a gallon, natural gas rates headed for a 20 to 30 percent rise. Add that to electricity bills up, some municipalities are shifting to four-day work weeks, and moving aggressively into renewable energy & energy efficiency.

Utah made headlines in July by becoming the first to put most state employees on a four-day week of 10-hour days. About one-third of the state’s 3,000 government buildings will be closed on Fridays, with expected savings on heat and air conditioning to hit $3 million a year. Commuters will also save on gasoline. Utah’s Governor Jon Huntsman said, “The reaction from the public has been very much a willingness to give this a go.”

Energy efficiency is happening in all sectors. Behavior is changing rapidly in light of higher prices; SUV and light truck sales have dipped 30-60% (depending on the brand) over the last year. Small car sales are up. Total “vehicle miles traveled” dipped for the first time since 1979. Yet, in the 1970s after the oil embargo prompted conservation habits for about a decade, U.S. Americans returned to wasteful ways, as oil prices dropped, ignoring past lessons.

The difference this time is that higher prices are prompted mostly by fundamental supply and demand issues. Peak oil production is either already here, or will be sometime between 2010-2015 at the latest. When global peak oil production is reached, prices will be far higher than today’s.

In order to lessen our dependence on oil, and keep our economy moving, energy efficiency is essential. This past July, U.S. Secretary of Energy Samuel Bodman met with the energy ministers from the Group of Eight (G8) industrialized countries, plus China, India and South Korea, to discuss ways to enhance global energy security while simultaneously combating global climate change. The G8, which includes Canada, Russia, France, Germany, Italy, Japan, UK and the US, established the International Partnership for Energy Efficiency Cooperation (IPEEC). It states that energy efficiency is one of the quickest, greenest and most cost-effective ways to address energy security and climate change while ensuring economic growth.

Meanwhile, financial support for the federal assistance “weatherization” program here in the US, which helps low-income families be more energy efficient, has dramatically declined. President Bush proposed eliminating the program entirely. An Energy Dept spending bill before the Senate, would provide $201 million for the fiscal year beginning in October ($40 million less than was supplied in 2007), while winter heating costs have soared. Bush, and GOP presidential candidate John McCain, and Republicans in Congress have touted drilling as the primary short-term solution to rising energy prices, despite the fact that opening offshore areas to production wouldn’t lower gasoline prices until about 2030 — if it does at all.

Currently, the average price for natural gas on the New York Mercantile Exchange (NYMEX) shows an increase of 33% this year. New Jersey customers will pay another 18% based on an increase requested by NJ Natural Gas to take effect this coming October, and another 15% or more expected next year. Between 2002 and 2007, the price of natural gas nearly doubled, according to the NJ Board of Public Utilities (BPU), with corresponding increases in the price of electricity and heating fuels in New Jersey.

To address the steadily rising prices of energy, New Jersey created an Energy Master Plan. Its primary goal is to maximize energy conservation and energy efficiency. Reducing energy consumption through conservation and efficiency is the most cost-effective way to help lower utility bills, increase reliability, and lower the state’s contributions to global warming and other air pollutants. Reductions of energy use by at least 20% by 2020, as Governor Corzine has directed, would yield annual electricity savings of 20,000 GWh per year and annual heating savings of 119 trillion BTUs, and result in substantial cost savings, thereby promoting economic growth in the state.

Actions to this goal include the following:

- Redesign and enhance the State’s current energy efficiency programs in all sectors of the economy to achieve desired results, while remaining cost-effective. This redesign emphasizes a whole-building approach to energy efficiency.
- Increase energy efficiency in new buildings with a statewide building code, which will make new construction at least 30% more energy efficient than buildings under current code by July 2009.

The market is willing to pay premiums for Energy Star buildings, says Stuart Brodsky, from the EPA’s Energy Star program, as identified in the CoStar study. “The business case for energy efficiency is indisputable,” he said. Green-built buildings have higher prices per square foot but have lower operating costs. Energy Star buildings are selling for an average of $61 more per square foot than conventional buildings. LEED buildings are selling for an average of $171 more per square foot, the study found. Operating costs are 10-20 percent lower in Energy Star-rated buildings, improving operating income significantly. The study also revealed that green buildings achieve higher rents and have higher occupancies.

New Jersey currently offers several programs in the way of incentives for energy efficiency:
Cool & Warm Advantage Programs – Cash rebates for energy efficient heating and cooling equipment (e.g., central air conditioners, heat pumps, furnaces, boilers or water heaters).
New Jersey for Energy Star – Offers rebates on ENERGY STAR clothes washers, room air conditioners and dehumidifiers.
New Jersey Energy Star Homes – Rebates for energy-efficient new home construction that target Smart Growth Areas. Energy Star Homes are at least 15% more energy efficient than conventionally built homes.
New Jersey Comfort Partners – Improves energy affordability for income-eligible households. If you qualify, a contractor will assess the energy savings opportunities and install the measures at no cost. Personalized customer energy education and counseling is also provided.
Home Performance with ENERGY STAR (HPWES), administered by New Jersey’s Clean Energy Program, uses a whole house approach to energy-efficiency, lowering energy costs by up to 30 percent or more. This program covers renovations only, not new construction. Participating contractors are accredited through the Building Performance Institute (BPI), a national resource for building science technology that sets standards for assessing and improving the energy performance of homes.

Where To Start
Call in an expert that can show you the “biggest bang for your buck” when it comes to paying for energy efficiency upgrades. A specially trained and certified technician will conduct a Comprehensive Home Assessment, which has two phases.

Phase one consists of the technician taking inventory of, and reporting on, the current conditions in your home, including the following:
- Health & safety check (carbon monoxide levels, moisture, and indoor air quality problems)
- Overall comfort level (cold/hot spots, indoor air quality stuffiness/stale odors)
- Air infiltration rates
- Insulation levels
- Heating and cooling systems efficiency
- Domestic hot water system efficiency
- Major appliances
- Lighting

Certified technicians use a number of diagnostic tools during the first phase of your Comprehensive Home Assessment. Some of the tools they use are:
- Carbon Monoxide (CO) Analyzer: important health and safety tool
- Blower Door: measures the air tightness of a home and assists in identifying areas where air leakage is occurring

Phase two consists of contacting a BPI certified contractor to receive pricing on the proposed improvement work. They test carbon monoxide levels and potentially dangerous gases in the home before and after performing energy improvements. You will receive a detailed plan with recommended measures, costs and payback analysis. Many owners use home equity loans to finance the upgrades.

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