Kermit the Frog had it right, especially for home builders.
- Energy describes those resources such as petroleum, coal, gas, wind, nuclear fuel, and sunlight from which energy in the form of electricity, heat, etc., can be produced.
- Energy efficiency is simply the process of doing more with less. The goal is to accomplish the same tasks and functions as before while using less energy.
- What's the objective:
- To reduce energy required to regulate temperatures, run appliances, etc.
- To provide cost savings to customers
- To have customers experience useful benefits and perceive great value
- To reduce the world's energy needs
- To help control global emissions of greenhouse gases
- In many countries, energy efficiency is also seen to have national security benefits.
- It's the right thing to do.
Presenting Home Energy Efficiency to Buyers: How It's Done
- Present the percentage savings as a monthly amount.
- Let's assume that the estimated monthly cost for energy (heating, cooling, and lighting) for a home that is comparable in size to the product you are offering, but does not have any energy-saving systems, is approximately $500 a month at today's cost of energy. The 30-percent savings in energy efficiency translates into a dollar savings of $150 per month—a sizable number to be sure, but still not impactful enough.
- Now create the comparison. Take the $150 monthly savings and convert it to buying power. Explain that at today's current rates (let's say 4.5 percent for this example), it takes approximately $5 per month to pay off the interest and principal on each $1,000 of mortgage money borrowed on a 30-year loan.
- Here is where you can turn that 30-percent figure into buying power. In your head, you can estimate as follows. Each $5 per month will pay off approximately $1,000 of borrowed money. Also, you are showing an approximate monthly savings as a part of their total cost of ownership in energy savings of $150 monthly. Divide that $150 by $5, and for each $1,000 of mortgage money you get 30, which represents $30,000 of mortgage money not being borrowed. To validate, use Google search to find any amortization table and plug in the $30,000 mortgage amount at 4.5 percent interest for 30 years. The answer will show a monthly payment of approximately $150.
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