This homeowner avoided 'energy guzzlers' for more efficient options, and it's paying off

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When Bruce Sullivan set out to build his dream retirement home in 2015, his goal was to get his utilities costs as low as possible.

Today the 900-sq-ft Bend, Oregon, home that he shares with his wife has more than accomplished that, he said.

The one-bedroom, one bathroom house is what Sullivan calls a “zero energy” home.

“It actually generates more electricity, more energy overall, than it uses,” Sullivan said. “And it charges our electric car.”

That’s quite an accomplishment. Saving energy isn’t just good for the planet, it’s good for your wallet, as well. But energy guzzlers, such as the cooling and heating systems in your home, can cost hundreds to operate each month.

For Sullivan those savings have been achieved through the home’s unique construction.

That includes 10-in.-thick walls and a 16-in.-thick insulated roof. The home also faces south, which helps to provide solar heat.

In addition, the house has rooftop solar panels that generate more energy than the couple uses for 10 months out of the year.

As a result, Sullivan’s energy bill is just $10 per month to cover the administrative fees the utility company charges. The monthly water bill is also low, due to dual flush toilets and low-flow shower heads.

Sullivan is counting on the continued savings to help his bottom line.

“Those are earnings that will come back to me over time, and it just gets better every year,” Sullivan said.

For homeowners of existing homes, the good news is, it is possible to reach zero energy through improvements, according to Sullivan, who serves as the technical director at Zero Energy Project, a nonprofit organization aimed at helping homeowners reduce their carbon emissions and energy bills.

Even smaller-scale tweaks — such as installing insulation or new energy technologies — can result in substantial savings, from hundreds to thousands of dollars per year.

There are several ways to go about this. You can hire professionals, do it yourself or use new technology products on the market.

When it comes to fixing up an existing home, using a professional can really help assess what improvements are needed, according to Sullivan.

To get the right help, make sure you’re working with a certified professional.

There are two main organizations that offer certification: the Building Performance Institute and the Residential Energy Services Network, or RESNET.

RESNET also provides a home-energy rating system, which scores homes based on their energy efficiency. Once raters do a professional analysis of your home, you can see which areas need improvement.

This kind of assessment can help if you plan to use a lender to fund upgrades, Sullivan said.

For example, a homeowner could borrow $25,000 or $30,000 with a home-improvement loan and use that money for energy conservation efforts, such as sealing heating leaks or installing solar panels.

“If you can borrow the money to do it and your savings exceed your financing costs, then you just got free improvements,” Sullivan said.

Now, in particular, is a good time to consider solar energy systems, as the tax credits of those installations are set to go down after this year, Sullivan said. In 2019 you can deduct 30% of the cost of installation from your federal taxes. In 2020 that will go down to 26% and will get further reduced in subsequent years.

“Use your professional to create a plan so that you will do the most cost-effective things in the right order,” Sullivan said.

If you do not have much cash available, there is good news: There are improvements you can make without a professional and without paying a lot up front.

The Community Energy Project, a Portland, Oregon-based nonprofit, helps local residents of all economic backgrounds make home upgrades that can help them save both energy and money.

While the organization can match homeowners with the right contractors and lenders, it also provides educational services to help individuals make these improvements on their own.

Among the more popular upgrades for do-it-yourselfers: putting in new insulation, according to Peter Kernan, program director at the Community Energy Project.

Because heat flows like liquid, holes in insulation can result in huge losses, Kernan said.

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By thinking of a home as a six-sided box — including the attic, walls and underneath the floor — homeowners can plug those gaps and stem those losses, he said.

“Adding insulation is the biggest thing that will make an impact on your home,” Kernan said.

Of course, before taking on those renovations, homeowners need to make sure there are no health or safety concerns, such as asbestos or old wiring.

For each wall surface, insulation can run from $2,000 to $4,000, Kernan said. If you are buying enough insulation, you can sometimes rent the blowing machine needed to install it for free, depending on the store, he said.

By adding new insulation and putting in high-efficiency heating systems, individuals can help bring a home’s total utility costs down from $2,000 per year, on average, to $1,000, according to Kernan.

Homeowners with a more hands-off approach may want to use technology to help assess where they are wasting the most energy.

One company, named Sense, is providing a home-energy monitor to help identify those energy drains.

Once the company’s technology is installed inside the electrical panel of your home, it measures how much energy is being used in real time.

“If you can get visibility into where your energy is going, most homes have these couple of gremlins that really could save you if you know what they are,” said Mike Phillips, CEO and co-founder of Sense. One single device could be a major energy drain. For instance, simply unplugging a treadmill could help immensely.

Some other big culprits include older TVs, game consoles and other entertainment-related equipment. Once those power wasters are identified, homeowners can either disconnect the device or use a smart plug to regulate its use.

The discoveries can lead to big savings for some homeowners, Phillips said.

For example, one family had an older desktop computer that they kept in sleep mode. With the help of the Sense technology, they came to realize that their dogs would vibrate the mouse and wake the computer up when they ran through the house. By switching the computer from sleep to hibernate mode, they were able to shave $250 off their utility bill for the year.

The Sense technology costs $299 for the hardware and applications, and there is no ongoing service charge. The average cost for an electrician to install it is $115.

As a result, the product only makes sense for homes of a certain size, Phillips said. For homes with utility bills around $300 per month, there is a fast payback, he said. For those who are paying around $80 per month, the savings may not justify the cost.

Sense recently analyzed which hidden energy costs are hitting homeowners’ wallets the most. These are the estimated annual expenses that homeowners should watch out for, according to the company.

1. Basement exhaust fans: $82 to $156

2. Hot tubs: $600 to $1,200

3. Radon system fans: $50 to $400

4. Incandescent lightbulbs: $210 for six 100W bulbs

5. Swimming pools: $310 to $620

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