Many Energy Efficiency Upgrades Don’t Pay off, Study Finds

The retrofitted homes researchers analyzed only saved less than half the price of the improvements

July 07, 2015
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A study conducted by researchers from UC Berkeley and the University of Chicago found that energy-efficient updates in Michigan homes supported by the Federal Weatherization Assistance didn’t pay off financially.

(A summary of the study appears in the UChicago News; the original document can be downloaded from the Social Science Research Network.)

The retrofit only delivered “a small fraction of their promised energy savings and [they] may not save any money over the long run,” AZ Central reports. Updates included the installation of new windows and high-efficiency HVAC systems, which did cut a home’s energy consumption as well as the homeowner’s bills, just not enough to cover the installation costs

The study used data from a random sample of 30,000 low-income Michigan households that were eligible for an Energy Department home weatherization program.

In Construction Dive’s summary of the report, researchers found that “the homes in the study had been retrofitted with $5,100 worth of energy upgrades. Over the lifetime of the upgrades, the households had saved an average of $2,400 — less than half the price of the improvements.”

Researchers say that the study should not be seen as a dismissal of energy-efficient weatherization methods in general.

“The study, which encompassed about 30,000 homes, targets a small subset of income-eligible homes in a very cold state. You can't extrapolate that to all energy efficiency, or even all weatherization,” Meredith Fowlie, associate professor at UC Berkeley and lead author of the study, told Utility Dive. She also cautions that trying to toss out the results because they contradict so many other studies “would also be incorrect.”

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