How Every State Benefits from Energy Efficiency Standards

Energy efficiency standards are one of the most cost-effective, straightforward ways to address the greenhouse gas emissions that stoke climate change.
Credit: ASAP

Your new refrigerator and clothes washer do more than just keep your food cold or clean your clothes. They save money and energy, too—and a new report shows just how much standards are savings households in every state. As appliances and equipment get more efficient, residents in every U.S. state benefit. In 2015, household utility bill savings equaled as much as 27 percent of total utility bills thanks to standards for appliances and equipment. In total for products purchased through 2035, Americans will save $2.4 trillion because of energy efficiency standards set over the past three decades.


These figures appear in a comprehensive, state-by-state look at energy efficiency savings just released by the Appliance Standards Awareness Project and the American Council for an Energy-Efficient Economy. The groups found that the average 2015 household savings on utility bills ranged from $360 in Washington to almost $950 in Hawaii.


Those savings will keep growing as new efficiency rules are established. Last year, the U.S. Department of Energy released new or updated standards for 11 products ranging from air conditioners to ceiling fans (read more in detail about the 2016 standards here). Over the next 30 years of sales, those improvements alone will save $75 billion and more than enough electricity to power the entire United States for a year.


Energy efficiency standards also are one of the most cost-effective, straightforward ways to address the greenhouse gas emissions that stoke climate change. They reduce the need for expensive power plants and save not just electricity but also water, natural gas, and heating oil. In 2015 alone, standards helped avoid carbon dioxide pollution equivalent to the annual output of 63 million cars.


As more efficient products replace older, energy-hogging models, the new report estimates that annual per-household average savings will grow from nearly $500 in 2015 to about $840 in 2030. Nationwide over the same time period, annual utility bill savings will grow from $80 billion to nearly $150 billion.


The progress is stunning, but even more can be accomplished, the ASAP-ACEEE analysis notes. By updating existing standards, U.S. homes and businesses could save another $65 billion per year by 2050, all while conserving more electricity and water, adding jobs, and avoiding new fossil-fuel power plants.


Consumer savings vary from state to state depending on factors including energy prices, the types of appliances consumers have, and household size. People in Hawaii pay more for electricity than anywhere else in in the nation for example, so that state saw the biggest average utility bill savings. But households in every state enjoy substantially lower utility bills because of the appliance standards now in place. Ohioans, for example, saved an average of $450 on utility bills in 2015; households in Nevada and Michigan each saved close to $475.


In general, households in southeastern states, along with Texas and Arizona, saved the most electricity from standards, according to the report. This is expected since these geographic areas tend to depend more on air conditioning, electric heat pumps, and electric water heaters than states in northern climates. Florida households benefitted the most in terms of electricity savings from standards, avoiding 3,300 kilowatt hours of electricity on average in 2015. Savings from the national standards program accrue to consumers regardless of the political persuasion of their state. These southern states tend to be more conservative, and most do not have robust statewide energy efficiency programs for consumers. Strong national standards mean that consumers still have ways to keep their utility bills under control.


Alaska ranked first in household natural gas and heating oil savings, followed closely by New Jersey. These and other states where households saved the most gas and heating oil—including Illinois, North Dakota, Colorado and Minnesota—have colder climates and are more likely to use natural gas or oil for heating and water heating. Consumers in these states benefit the most from efficiency improvements to natural gas water heaters, for example. Nationally, household gas and heating oil savings averaged 6 percent of 2015 household usage.


Credit: ASAP

Stronger standards have helped save water, too, particularly among larger households. Per-household water savings in 2015 ranged from 7 percent to 23 percent of water use, or from about 10,500 gallons annually in Maine to 14,500 gallons in Utah. The average household saved 14 percent of the year’s water use—about 12,000 gallons, which is equivalent to the water used for one person to shower each day for a year.


Businesses large and small are also seeing benefits because of standards rolled out since the first national energy efficiency standards were enacted in the late ‘80s. Convenience stores and restaurants, for example, have better retail refrigerators and walk-in coolers. Owners of office buildings spend less on lighting, thanks to LEDs and other options that use up to 85 percent less energy than conventional bulbs. Energy bill savings for businesses in 2015 were equal to 8 percent of business spending on power and natural gas, and businesses saved a total of nearly $23 billion on utility bills.

Credit: ASAP

The benefits of upgrading to more efficient appliances overwhelmingly outweigh the costs by 5 to 1, the report notes, using cost estimates made when each of the standards were first established. In reality, any price increases for many improved products are often just a fraction of what was predicted—sometimes, prices actually drop. Refrigerators are a good example: A new one today uses 75 percent less energy than in the mid-1970s, but in real dollar terms costs half as much.


Changes in standards also drive employment, as confirmed by a recently released report from the Department of Energy. From building construction to appliance manufacturers and installers, making U.S. homes and businesses more energy efficient employs some 2.2 million workers. Of all the firms in the DOE survey, the energy efficiency sector projected the highest employment growth through late 2017 at 9 percent. Meanwhile, the fuels sector, which includes all work related to fossil fuel extraction and mining, anticipated a decline of 3 percent.


Efficiency standards are unquestionably good for American consumers, saving electricity, natural gas, water, and money.