Assessing Your Payback on a High Efficiency Equipment Purchase

In this era of ever rising energy costs which far outpace the inflation rate,
many new customers have entered the HVAC marketplace looking for new
equipment. In an effort to gain those new customers attention many new
claims are being made on a daily basis through all sorts of media regarding
the effectiveness of a their said equipment. Don’t rely on advertising
or unqualified opinions claiming fantastic amounts of energy savings.
Generally when an outrages number is quoted such as, “Save 50% on your
heating bill this winter!,” the statement is loaded and depends on several
conditions being met. For the vast majority of home owners a savings of
50% on your heating appliance is just not a reality. Claims have also
been made regarding the current condition of older equipment such as, “Replace
that old 60% efficient furnace with a brand new model…,” Let’s face some
undeniable facts here, for a gas fire appliance to actually run at 60%
efficiency the flue (chimney) temperature would need to be between 800 F and
1000 F (varies based on excess air content of flue gas). Those are
staggeringly high numbers that the average furnace is probably incapable of
putting out, unless there is a catastrophic failure going on.

We’re not saying that drastic reduction in energy use can
be realized but rather to not expect all of it from installing a new piece of
equipment like for like. Installing equipment that is 20% more efficient
than the old equipment obviously will save said amount, but at a cost.
If energy, for most people money, savings is your goal the probably the most
cost effective measure is to use less energy.

USE LESS ENERGY!

You may be saying to yourself, “Huh?? I thought that
is what the point of this discussion was?” It is, but we should define
our terms a bit hear. When discussing payback, we are trying to discover
the amount of time it takes for a piece of equipment to pay for itself based
on efficiency increase. The efficiency of a system is the ratio of the
energy out vs. the energy in. A higher efficiency unit uses less energy
in, thus has a higher efficiency. On the top side of that ratio is
energy out, which you also have control over. This is what I would
term, Energy Conservation, or using less energy. In this category are
some of the cheapest alternative to lowering your utility bill. Such
items as a
Programmable Thermostat, adding insulation, isolating unused rooms, and
using the sun more effectively.

In a related article please see the graph regarding the
energy savings from changing the set point of the
thermostat. To
really make a programmable thermostat effective the user needs to adjust set
points as often and as much as possible. The effects on energy usages
are clearly shown on the three curves, and obviously you want to establish the
most time you can with the greatest setback. Obviously most people
wouldn’t be comfortable with a 50 F house in the winter, however most can
sleep with a few blankets and at 60 F.

CORRECTLY SELECT EQUIPMENT SIZE

Having your heating or cooling equipment correctly
sized for your application is often overlooked as a source of savings.
In this case, bigger is not always better. If your house is older and
you were not involved with the original equipment selection, then definitely
do a calculation. If your house is new, then definitely do a
calculation. First off its not that difficult, and actually kind of
interesting. Spending some of your own time evaluating your house
construction not only allows for accurate data input, but gives you the chance
to identify room for improvement in regards to insulation, vapor seals, etc.
DO NOT rely on the builder of your house decades ago who you probably don’t
know, nor have any reason to trust. If hiring a contractor, if they
don’t do a detailed calculation, and then share and explain the results to
you, move on and hire his/her competition who does. Even if hiring
someone else to do the calculations, we suggest you double check the data
yourself. This one decision can not only dictate the energy efficiency,
but also very importantly the maintenance of the equipment. A very cost
effective software solution is available for the home owner to do their own
analysis by HVAC Computer
Systems Ltd.

DO A COMPARATIVE ANALYSIS

This a wonderful
website called HVAC OpCost. Use it to not only get an estimate but
compare operating costs. Some things to consider while using this tool.

1. The sizing function is only an estimator, obviously a
   1500 square foot house with a wall of windows facing south has a different
   load than a 1500 square foot house with few windows.

2. Use the tool to not only compare between your old system
   and a new system, but to also decide between incremental cost differences
   (i.e. 94.1 vs. 95.0% efficiency)

3. Sometimes it takes a couple iterations to get your
   calculations right. You may have to massage your square footage or
   existing equipment efficiency to get the utility bill to more closely
   reflect your actual bill (less taxes, fees, etc)

DON’T OVERPAY FOR TECHNOLOGY

Finally, using your comparative analysis above and other
information you have learned one more thing to consider is to not buy the
Newest thing out there. You tend to pay a premium for new technology,
with little payback. Manufacturers have to recover R&D costs and many
people are willing to pay that premium, so the latest item is generally
overpriced for its value. You’ve probably seen this in the technology
sector such as Cell Phones or computers, the newest item is generally hot for
a few months then comes back to the pack as soon as a newer item is
introduced.

HVAC-Direct: Effect of Thermostat Setpoint on Heat Loss