How we are saving money by reducing our carbon footprint

When we moved to Oklahoma we bought a house on the outskirts of Norman that was built in the early 1970’s.  Energy efficiency was not a priority in the early 70’s and the house is all electric.  The amount of the electricity we used and the size of our electric bills shocked us. 

Within a year we had to replace the aged air conditioner.  Though the savings only accrued in summer months, improvements in the energy efficiency of the new unit were so significant that it paid for itself in three years.  Our winter electric bills, however, remained exorbitant. 

Could we see as significant changes by replacing the heating unit?  The answer was no.  Not if we merely replaced it with a system with ordinary heating elements.  The only way to match the savings we got by upgrading the air conditioner was to install a geo-thermal heating and air unit and those systems are expensive.  We put that upgrade on hold for more than ten years – the reasonable life expectancy of our new air conditioner.

Five years ago we borrowed $22,547 and had Waggoner’s Heating and Air of Norman install a geo-thermal HVAC system.  That involved drilling two wells 350 feet deep in the yard and laying a loop of pipe five feet underground from the house to the wells.  Pumps circulate water to the wells and back from the HVAC unit which is fully contained in the house.  Ground temperature keeps the water in the closed loop returning to the HVAC at a constant 55 degrees.  The air handling unit of the HVAC cools in the summer with 55 degree air without using refrigeration and heats winter air from a 55 degree base temperature.

Was it worth it? 

Rebates helped lower the system’s cost.  Our electric company gave us a $3,000 rebate check a week after it was installed.  An IRS tax deduction of $6,737 came the next year.  That covered nearly half of the expense of the unit.  That still left $12,720 to work down before the system would pay for itself and we could not count on significant savings on our summer electricity bills because the energy efficiency of our twelve year old air conditioning unit matched that of the geo-thermal HVAC.

Five years out here is where we stand.  From October 2008 to September 2012 we used 123,753 kilowatt hours at an average cost of 8 cents per KWH and paid $10,498 for electricity.  According to the EPA’s Household Carbon Footprint calculator (https://www3.epa.gov/carbon-footprint-calculator/), that resulted in producing 19,844,907 pounds of CO2 emissions.  From October 2012 to September 2017 we used 60,687 kilowatt hours at an average cost of 11 cents per KWH and paid $6,611 for electricity.  According to the EPA calculator, this resulted in producing 9,731,707 pounds of CO2 emissions. 

Assuming that had we not upgraded the HVAC system we would have continued to use the same amount of energy in the last five years as we did in the previous five years, we saved 63,066 kilowatt hours of electricity and reduced our carbon footprint on the environment by 10,113,201 pounds of CO2 emissions.  That is the equivalent of 46.9 metric tons of carbon dioxide which is about the same as driving an ordinary car 115,036 miles.

From an environmental standpoint, it was definitely worth it to us. 

What about the money?

Taking 63,066 KWH and multiplying it by 11 cents per KWH, we saved $6,937 on our electric bills over the past five years.  That’s a savings of $115.62 a month and $1,387.45 a year.

How far are we from breaking even on this investment? 

Our out-of-pocket cost after rebates and tax deductions was $12,720.  Subtract $6937 from $12,720 and we are still out $5,783. 

Assuming utility rates stay the same and that there is no need to replace what would now be a 45 year old heater and/or a now 17 year old air conditioner, we still have nearly four more years to go before breaking even.  

Knowing how unlikely these latter assumptions are, I think we are close to breaking even now.