Energy efficiency: where to start

Know where your energy goes

In 2020, the average US household used 52% of its energy for heating and air conditioning, and another 25% for water heating, lighting and the refrigerator, according to the Energy Information Administration. Everything else, from TVs to clothes dryers, shared the remaining 23%. So start with heating, cooling and the building around them, not with the chargers.

Look at twelve months of bills to see your own pattern: a winter peak points to heating, a summer one to cooling.

The US has no single energy label for homes, but some homes have a Department of Energy Home Energy Score, from 1 to 10, where 10 means the most efficient, with a list of recommended improvements. In the UK, homes that are sold or rented need an Energy Performance Certificate, rated from A (best) to G (worst) and valid for 10 years; you can look one up for free on GOV.UK.

The cheap fixes, first

Before you buy anything big, do the jobs that cost little and pay back fast. A home energy assessment, often called an energy audit, can show you where your home leaks air and money. Then:

• Seal and insulate. ENERGY STAR says sealing air leaks and adding insulation can save up to 10% on your annual energy bills: weatherstripping doors and caulking around windows are simple jobs; sealing and insulating the attic is a bigger one.
• Turn the thermostat back. The Department of Energy estimates you can save as much as 10% on heating by turning it back 7 to 10°F for 8 hours a day, while you sleep or are out. A programmable thermostat does it for you.
• Lower the water heater. The Department of Energy suggests 120°F instead of 140°F: it lowers the risk of scalding and can save money. People with a weakened immune system or a chronic respiratory disease may want to keep it at 140°F.
• Finish the lighting. If you still have incandescent bulbs, the Department of Energy says the average household can save more than $200 a year by using LED lighting.

Then the big decisions

Replacing a furnace, boiler or air conditioner is where the big money goes, and the order matters. The Department of Energy’s rebate program puts insulating and sealing the home before upgrading heating and cooling, to get the most out of the savings.

A heat pump heats and cools with one machine. Whether it costs less to run than a gas furnace or boiler depends on your electricity and gas prices, your climate and your home; the heat pump or gas heating calculator compares them with your own numbers.

Solar panels deserve their own homework, from your roof to quotes you can compare line by line: the solar checklist walks you through it before anyone comes to measure.

Credits, rebates and payback

Check the money before you sign. The federal tax credits for efficiency upgrades and for home solar have ended: the IRS says they aren’t available for property placed in service after December 31, 2025. Some states offer Home Energy Rebates funded by the Department of Energy, which says they’re available in select states and suggests asking your State Energy Office about status and rules. ENERGY STAR’s rebate finder lists offers from utilities and other partners by zip code.

Then do the payback math: the cost after rebates, divided by what the upgrade saves in a year, gives the years it takes to pay for itself. For example, $1,200 of work that saves $150 a year pays for itself in 8 years. Fixes that pay back in a few years usually come before the ones that take decades.