Latest news with #ACEEE
Forbes
9 hours ago
- Business
- Forbes
Is The Juice Worth The Squeeze: Energy-Efficiency Projects Make Cents
Homeowners can have both energy efficient heating/cooling and savings with the help of an energy ... More analyst. With the burden of rising energy costs, many homeowners are feeling the pinch in their pockets. The National Foundation for Credit Counseling reports that 'Government agencies define utilities above 6% of your income as a high energy burden.' However, it is not just the high energy costs that are the issue, but also the site's energy consumption that is driving up the bill. But there is hope—energy efficiency projects can provide relief from this financial strain. According to the American Council for an Energy-Efficient Economy (ACEEE), the average U.S. household spends about 3.1% of income on energy, while low-income households spend more than 8%, with some exceeding 16%. To resolve high energy utilization, homeowners should look into home energy-retrofit projects that are cost-effective—meaning that the investment has a positive impact on the household budget. Take a look at the Forbes article in April titled, 'Our Energy Bills Are High, And This Is Why,' to learn about the 'why' behind high energy bills. After an energy audit, the building science practitioner should review the report with the homeowner. The report should capture all diagnostic testing and show where the customer should start investing. The energy-modeling software report should provide detailed information to empower customers to make informed decisions. The solutions often come with cost-benefit metrics such as 'Simple Payback,' 'Savings-to-Investment Ratio (SIR),' and 'Return on Investment (ROI),' all of which can give homeowners a sense of control over their energy usage and costs. Simple payback is a financial metric that calculates how quickly an investment is recovered. This may be important to some people, as money has more value today than it will in the future due to inflation. This concept is known as the 'Time Value of Money.' For commercial projects, the ideal goal is for a project to pay for itself within five years. In the residential sector, projects are considered fair if they pay for themselves within 10 years or less. Example: Retrofit costs $1,000 and saves $100 per year. Payback = (1,000/100) = 10 years The SIR metric indicates that a project will pay for itself. To calculate the SIR, divide a project's savings by its initial investment. The SIR considers the life cycle cost of the retrofit project. An SIR of 1 means that the project will pay for itself in its useful life. The higher the number, the more the project will pay for itself. SIR may not matter to some customers, as comfort may be what they value. For example, in the Midwest region of the country with short summers, an air conditioner, even if considered high efficiency, will not run long enough to offset its initial investment. Despite this, customers still want to be comfortable and will purchase the system anyway. $30,000.00 (existing system) - $20,000.00 (cost of the new system) = $10,000.00 (savings) $10,000.00 (savings) ÷ $5,000.00 (initial cost) = 2 SIR 2 SIR means the retrofit will pay for itself twice during its life cycle. The Annual Return is the interest rate your money earns on your retrofit project. It is similar to returns in a 401(k) or investment account. The Annual Return is the reciprocal of the SIR. To calculate the Annual Return, take the annual savings of a project and divide it by the initial investment of the project. Example: Retrofit costs $1,000 and saves $100 per year. Annual Return = (100/1,000) = 10% The energy savings from the project can often cover the financing payments, making the retrofit budget-neutral. In conclusion, energy-efficiency retrofit projects are not just practical—they are essential. They empower homeowners to lower utility costs, increase comfort, and invest wisely in their property's future. With supportive data, financing options, and a clear return on investment, the case is clear: energy efficiency is a smart financial move and a step toward a more sustainable, affordable lifestyle.
The Guardian
07-05-2025
- Business
- The Guardian
Utility bills could rise as Trump's EPA to end Energy Star program, experts warn
US customers could face higher energy bills, experts have warned, amid reports that the Environmental Protection Agency (EPA) plans to end the Energy Star program whose blue labels have certified energy efficiency on home appliances for more than 30 years. 'If you wanted to raise families' energy bills, getting rid of the Energy Star label would be a pretty good way,' said Steven Nadel, executive director of the non-profit research organization the American Council for an Energy-Efficient Economy (ACEEE). 'This would take away basic information from consumers who want to choose cost-saving products easily. There's a reason this program has been so popular with consumers and manufacturers alike.' In March, hundreds of companies and groups signed a letter urging the EPA administrator, Lee Zeldin, to maintain full funding and staffing levels in the program. The reports of its elimination come after Donald Trump has railed against showers and toilets that conserve water. In April, he signed an executive order to 'restore shower freedom'. The plans to close the popular Energy Star program, first reported by CNN and the Washington Post, would come as part of wider agency cuts and the dissolution of the EPA's office of atmospheric protection (OAP) and the office of air quality planning and standards. The plans to close the popular Energy Star program, first reported by CNN and the Washington Post, came after an OAP staff meeting on Monday. The New York Times reported that staff were told: 'The Energy Star program and all the other climate work, outside of what's required by statute, is being de-prioritized and eliminated.' The EPA on Tuesday declined to comment specifically on Energy Star but said: 'EPA is delivering organizational improvements to the personnel structure that will directly benefit the American people.' In the letter sent to the EPA in March, nearly three dozen trade industry groups and appliance companies including the Chamber of Commerce, Bosch, Carrier and the Air-Conditioning, Heating, and Refrigeration Institute said Energy Star was a good 'non-regulatory' collaboration between the private sector and federal government. 'Eliminating it will not serve the American people. In fact, because the Energy Star brand is highly recognizable to consumers, it is likely that, should the program be eliminated, it will be supplanted by initiatives that drive results counter to the goals of this administration such as decreased features, functionality, performance, or increased costs.' skip past newsletter promotion Sign up to Down to Earth The planet's most important stories. Get all the week's environment news - the good, the bad and the essential Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy. We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion Other OAP programs that are uncertain amid the reorganization include the voluntary methane reporting program for the oil and gas sector. Democratic senator Jeanne Shaheen of New Hampshire said ending the program would raise costs for consumers. 'Let's be clear: Cutting the popular Energy Star program – which helps everyday households and businesses save on their energy bills – would mark another rash attempt by this administration to line the pockets of billionaires and utility companies at the expense of hardworking Americans,' she said in a statement. Reuters contributed to reporting
Associated Press
18-04-2025
- Business
- Associated Press
New Jersey Jumps to Top 10 in National Rankings for Energy Efficiency
Originally published by ROI-NJ New Jersey is being recognized as a national leader in energy efficiency programming and outcomes in the American Council for an Energy Efficient Economy 's (ACEEE) 2025 State Energy Efficiency Scorecard, which ranks all fifty states and Washington D.C. New Jersey ranked #8, returning to the top 10 for the first time since 2008 and was listed as one of the most improved States. 'We are thrilled to earn this major achievement with our rankings in the 2025 ACEEE State Scorecard,' said NJBPU President Christine Guhl-Sadovy. 'This confirms our State's investments in efficiency programs are among the best in the nation at delivering results by reducing energy demand, delivering energy savings, and securing long-term bill stabilization for New Jersey ratepayers.' 'Today's announcement underscores the tremendous strides New Jersey has made in the years following the signing of the Clean Energy Act into law by Gov. Murphy,' said Eric Miller, executive director of the Office of Climate Action and the Green Economy. Continue reading here. Visit 3BL Media to see more multimedia and stories from PSEG
Yahoo
11-03-2025
- Business
- Yahoo
How closing the ‘spark gap' can boost heat pump adoption
For most U.S. homes, heat pumps are a no-brainer: They can lower energy bills and eventually pay for themselves all while slashing carbon emissions. But the economics don't work in favor of heat pumps for every home — and particularly not for those in states that have high electricity prices relative to those of fossil gas. Adjusting the structure of customer electricity rates could turn the tables, according to a report out today from the nonprofit American Council for an Energy-Efficient Economy, or ACEEE. The ratio of average electricity prices to gas prices (both measured in dollars per kilowatt-hour) is known as the 'spark gap' — and it's one of the biggest hurdles to nationwide electrification. A heat pump that is two to three times as efficient as a gas furnace can cancel out a spark gap of two to three, ensuring energy bills don't rise with the switch to electric heat. But in some states, the gulf is so big that heat pumps can't close it under the existing rate structures. Worse, heat pump performance can decrease significantly when it's extremely cold (like below 5 degrees Fahrenheit), so without incentives, the economic case is harder in states with both harsh winters and electricity that's much more expensive than gas, like Connecticut and Minnesota. In these places, heat pump adoption is 'hit by double whammy,' said Matt Malinowski, ACEEE buildings director. The weather might be hard to change, but the spark gap is malleable: Utilities, regulators, and policymakers can shape electricity rates. By modeling rates for four large utilities in different cold-climate states, ACEEE found that particular structures can keep energy bills from rising for residents who switch to heat pumps, without causing others' bills to go up. Flat electricity rates are a common practice. They're also the worst structure for heat pumps, Malinowski said. When utilities charge the same per-kilowatt-hour rates at all hours of the day, they ignore the fact that it costs more to produce and deliver electricity during certain hours. That's because, like a water pipe, the power grid needs to be sized for the maximum flow of electrons — even if that peak is brief. Meeting it requires the construction and operation of expensive grid infrastructure. Flat rates spread the cost of these peaks evenly across the day rather than charging customers more during the high-demand hours that cause a disproportionate amount of grid costs. But heat pumps aren't typically driving peak demand — at least, not for now while their numbers are low. Demand usually maxes out in the afternoon to evening, when people arrive home from work, cook, do laundry, and watch TV. Households with heat pumps actually use more of their electricity during off-peak hours, like just before dawn when it's coldest, than customers with gas, oil, or propane heaters. Heat pumps 'provide the utility a lot of revenue, and they do that at a time when there isn't that much electricity consumption,' Malinowski said. Under a flat-rate design, cold-climate heat pump owners 'are basically overpaying,' he added. 'Adjusting the rates to better reflect their load on the system — and the benefits to the system that they provide — is only fair.' A rate design that bases charges on when electricity is used would help course-correct. Known as 'time-of-use,' this structure charges more for power consumed during periods of peak demand and less for power consumed at other times, or 'off-peak,' coinciding with heat pumps' prime time. Utility ComEd serving the Chicago area is working to finalize time-of-use rates for households, joining the ranks of several other U.S. providers that already offer this structure, like Xcel Energy in Colorado, Pacific Gas and Electric in California, and Eversource in Connecticut. Demand-based rates are another way of accounting for a customer's peak demand profile and can help reduce a heat pump owner's energy bills. This approach tacks on fees scaled to a customer's peak demand that month. If it's 3 kilowatts, and the demand charge is $10 per kilowatt, the fee will be $30. But importantly, this structure also lowers the rates charged for the total volume of electricity. Even though households switching from gas to heat pumps under such a program would see higher charges for peak demand than before, Malinowski said 'they'll be using so much more electricity overall that they end up benefiting much more from that lower volumetric [per-kilowatt-hour] charge.' As a result, their energy bills can be lower than with a flat-rate program, the report finds. Winter discounts also help heat pumps make financial sense. In most states, electricity usage waxes in the summer — when people blast their air conditioners — and wanes in the winter, when many residents switch to fossil-fuel heating. Some utilities offer reduced electricity prices in winter to drum up business, a structure that benefits households who heat their homes with electrons. Xcel in Minnesota drops its June-through-September summer rate of 13 cents per kilowatt-hour to 11 cents per kilowatt-hour during the rest of the year for all customers. For those with electric space heating, including heat pumps, the rate is lower still: 8 cents per kilowatt-hour — a discount of 39% from the summer rate. According to ACEEE's modeling, the winter discount alone can save Minnesota Xcel customers in single-family homes on average more than $350 annually once they swap a gas furnace for a heat pump. Combining the winter discount with existing time-of-use rates or simulated demand-charge rates (given in the study) can further reduce annual bills by another $70. In Colorado, another state ACEEE analyzed, Xcel provides both time-of-use rates and a much shallower winter discount of about 10%. Even taken together these structures aren't enough to close the spark gap for heat pumps. Pairing that discount with demand-based rates wouldn't do the trick either, the team found. Only when they used the much steeper discount that Xcel deploys in Minnesota were they able to keep customers' modeled heating bills from climbing when they switched to heat pumps. One more option for utilities and regulators: discounts specifically for customers with heat pumps. More than 80 utilities in the U.S. currently offer discounted electric heating rates, with 12 providing them specifically for households with heat pumps, according to a February roundup by climate think tank RMI. Massachusetts regulators approved a plan by utility Unitil last June to offer a wintertime heat-pump discount — the first in the state — and directed National Grid to develop one, too. Unitil's discount amounts to at least 20% off the regular per-kilowatt-hour rate, depending on the plan customers choose. Colorado policymakers are also requiring investor-owned utilities to propose heat pump rates by August 2027. The takeaway from ACEEE's results is that in some states, the above rate designs could be promising avenues to ensure switching to heat pumps doesn't raise energy bills for most single-family households. But in other cases, additional policy might be needed. Connecticut's electricity prices are so high that these rate structures weren't enough to close the spark gap, the authors found. They recommend policymakers consider broader changes like putting a price on carbon emissions, implementing clean-heat standards that require utilities to take steps toward decarbonized heating, or investing in grid maintenance and upgrades to make electricity more affordable — for all customers.
Yahoo
04-03-2025
- Business
- Yahoo
This map shows where to swap out industrial boilers for heat pumps
U.S. manufacturers rely on more than 30,000 small industrial boilers to make a large number of things: foods, drinks, paper, chemicals, clothes, electronics, furniture, transportation equipment, and more. The vast majority of these smaller boilers burn fossil fuels — mostly gas, but sometimes coal or oil. Their emissions contribute not only to climate change but to smoggy skies and elevated asthma rates, too. Swapping out such boilers for electric industrial heat pumps would be a quick win for communities and regulators looking to improve air quality, said Hellen Chen, industry research analyst at the nonprofit American Council for an Energy-Efficient Economy, or ACEEE. Only about 5% of process heat in industry currently comes from electricity, but industrial heat pumps are gaining some momentum. They've already been installed in at least 13 American factories, helping reduce pollution from brewing beer, pasteurizing milk, and drying lumber. Kraft Heinz, the famed ketchup and mac-and-cheese maker, plans to install heat pumps at 10 factories by 2030. Oat-milk producer Oatly is considering one at a New Jersey plant. And policymakers in Southern California passed a rule last summer to phase out industrial boilers, a move that will likely boost heat-pump replacements. Industrial boilers spew a panoply of air pollutants as byproducts of combustion, including nitrogen oxides, or NOx. NOx is harmful in itself but also contributes to the formation of ozone, a key ingredient of smog that can inflame airways and cause a range of respiratory problems, especially in children whose lungs are still developing. To identify opportunities to clean up air quality, Chen and ACEEE colleagues recently mapped areas where ozone levels exceed the U.S. Environmental Protection Agency standard, the number of small industrial boilers in each area, and the fuel they use. In total, they found that more than 5,400 boilers currently burn in 174 counties. The team focused on smaller industrial boilers, defined as having capacities up to 50 million British thermal units per hour, because their emissions are often overlooked, yet the equipment is the easiest to switch out for heat pumps, Chen said. 'In areas where the baseline community pollution burden is already high, there is a really important opportunity,' Chen said. Heat pumps are 'a cleaner and more efficient technology that is ready for adoption today.' Depending on the boiler size, fuel type, and other aspects, the reduction in onsite NOx emissions from swapping just one industrial boiler for a heat pump is equivalent to taking 400 to 10,000 cars off the road, by Chen's calculation. The industrial emissions reductions would add up. Some counties host large stocks of these smaller boilers: Cook County, Illinois, has 297; Philadelphia County, 127; Harris County, Texas, 123; and Los Angeles County, 111, per the ACEEE map. Heat pumps are available now for low-temperature industrial processes, making them well-suited to industries like food and beverage manufacturing, which relies almost exclusively on heat below 266 degrees Fahrenheit (130 degrees Celsius). Low-temperature heat also plays a significant role in areas like chemicals and paper production. Industrial heat pumps, which were first developed in the 1980s, are wildly energy efficient and can use just one-third to a quarter as much energy as boilers. Depending on the relative prices of gas and electricity, that superior efficiency can deliver lower operating costs. Heat pumps can also improve product quality by providing more precise temperature control. Back in 2003, the Department of Energy found that heat pumps produce higher-quality dried lumber. Plus, heat pumps can have a smaller physical footprint than boilers with similar capacities since they don't store fuel, making them advantageous for facilities with limited floor space. Since they're modular, they can be installed in parallel to meet heat demands as needed, Chen said. Added up, these and other co-benefits can save facilities another 20% to 30% on top of reduced energy costs. The major impediment to switching out combustion boilers, which can last 20 to 40 years or more, is the upfront cost. The payback period for an industrial heat pump retrofit is typically on the high side — between five and seven years, Chen said. 'Unfortunately, many companies are looking for very short ROIs [returns on investment] of under three years,' Chen said, making the business case difficult even if the lifetime savings are great. In new facilities, heat pumps can cost the same as gas boilers to install, she noted. Policy support can make it more logical for a business to take on these upfront costs. At least one air quality regulator is beginning to push industries to decarbonize. Last year, California's South Coast Air Quality Management District passed a first-in-the-nation measure that aims to gradually phase out NOx emissions from 2026 to 2033 from more than 1 million large water heaters, boilers with capacities of up to 2 million British thermal units per hour, and process heaters in the area, which will necessitate the switch to electric tech. Chen hopes to see more regulators follow the district's lead as well as tackle what is to her the biggest hurdle to electrification in the U.S.: the relatively high cost of electricity compared with gas, known as the 'spark gap.' The spark gap, the ratio of average electricity price to fossil-gas price (each in dollars per kilowatt-hour), varies from state to state. A ratio of less than about three to four typically makes switching to a heat pump more economically feasible without additional policy support because industrial heat pumps are about three to four times as efficient as gas boilers and thus can lower operating costs, Chen noted. Electric utilities and regulators could redesign rates to make the electric equipment more attractive. The idea has precedent for home heat pumps, though hasn't been realized for industrial ones yet, as far as Chen's aware. State and federal programs are also helping to defray the capital costs of electrifying. California provides $100 million for electric upgrades at factories through the Industrial Decarbonization and Improvement of Grid Operations program. Colorado offers competitive tax credits — up to $168 million in total — for industrial facilities to install improvements that reduce greenhouse gases. Under the Biden administration, about $500 million was granted to Kraft Heinz and others for projects cleaning up emissions from process heat, part of a $6 billion windfall for industrial-decarbonization demonstration projects. But the fate of the awards is unclear as the sweeping federal funding freeze ordered by President Donald Trump in January has, so far, failed to fully thaw. With momentum growing for zero-emissions equipment like heat pumps, 'we're hoping that … more facilities will see them as a viable technology that's ready to go,' Chen said, and that companies 'will be more confident about applying this technology within their own facilities.'
