Middle Path Finance

Lower your utility bills this summer

Utility bills can hurt this time of year.

It's hot, so chances are the air conditioner is on. And if it hasn't rained in a while, your sprinkler is likely on full tilt, keeping your lawn mean and green.

It doesn't help that after years of steady decline, the percentage of income that U.S. families spent on energy began to rise in 1998.

The cost of natural gas has risen 65 percent since 2002, according to the U.S. Department of Energy. Heating oil costs have risen 11 percent, and electricity prices have gone up 26 percent.

Water and sewer rates in Columbus rose 10 percent in 2006 and went up an additional 15 percent this year.

Don't resign yourself to shockingly high bills. There are some simple things you can do to lower your costs without sacrificing comfort.

With a few simple changes, the typical family could save $50 or more a month on their utility bills, said Brad Stroh, founder of Bills.com, a consumer-finance Web site based in San Mateo, Calif.

"Any upgrade in efficiency will pay for itself in savings," said Jeff Deyette, energy analyst with the Union of Concerned Scientists.

That extra cash is nothing to sneeze at.

"You can use the savings to pay off debt and build wealth," Stroh said.

But being more efficient doesn't mean you have to be uncomfortable or spend a lot of money. A handful of low-cost, money-saving things can be done to lower your utility bills and put more cash in your pocket.

Water

The average quarterly water bill for a family of four in Columbus is between $182 and $219, according to the city public utilities department.

You can significantly reduce your water use -- and your bill -- if you install a few water-saving devices, according to Get Green Columbus, a city conservation program.

Install a low-flow showerhead : A 10-minute shower uses 50 gallons of water. A low-flow showerhead reduces that to only 25 gallons. Low-flow showerheads cost about $12 at home-improvement stores. If you shower 10 minutes a day, the savings would be 750 gallons of water a month, or about $5 a month on your water bill.

For added savings, replace your faucet aerator. Aerators are the round disks at the tip of the faucet that control how much water comes out.

Low-flow aerators cut water use from about 2.5 gallons to as low as half a gallon per minute, and cost about $1 each.

Watch the flush: The typical family of four uses 112 gallons of water a day, or 3,360 gallons a month, to flush toilets, at a cost of about $20 a month.

Replacing older toilets, which use 3.5 to 7 gallons of water per flush, with low-flow toilets using 1.6 gallons could reduce your water use by up to 73 percent. The cost to make a replacement starts at about $100, but you could save up to 2,450 gallons of water and shave about $14 a month off your water bill.

If a new loo is out of your budget, hanging a water displacement bag in the tank can reduce water use by 20 percent, or about 1 gallon per flush. Water displacement bags cost about $2, and could save you up to 672 gallons, or about $4 a month.

Lawn smarts : The average American family uses about 120 gallons a day, or 3,600 gallons a month, watering lawns and washing off driveways and sidewalks. You can reduce that by up to 50 percent by watering in the evening -- when less of the water evaporates because of heat -- and by "making sure you aren't watering your sidewalk instead of the grass," said Rick Tilton, assistant director of the city's division of water and power. Potential savings? About $10 a month.

Electricity

The average U.S. household consumes about 11,000 kilowatt-hours of electricity (kWh) a year, at a cost of about $900, according to the U.S. Department of Energy.

Switch to compact fluorescent light bulbs : Compact fluorescent bulbs use 75 percent less energy than incandescent bulbs and last up to 10 times longer, according to Energy Star, a government program that rates products by how much energy they save.

In central Ohio, it costs 95 cents to power one 75-watt standard light bulb for five hours a day for one month, according to AEP Ohio. It costs 25 cents to power a compact fluorescent for that long, a savings of 70 cents a month and $8.40 a year per bulb.

It takes only about 3 months to recoup the extra cost of compact fluorescent bulbs in energy savings, according to Energy Star.

If a houseful of new bulbs isn't in the budget, replace those in the fixtures you use most, such as the kitchen, bathroom and family room lights, Deyette said. Replacing five bulbs will save you about $3.50 a month, or $42 a year, according to AEP Ohio.

Buy a power strip : Many appliances use electricity even when they are turned off. It's called a phantom load, or vampire electricity, and the Ohio Consumers' Council says it accounts for 5 percent to 10 percent of a home's electricity use and costs Ohioans $46 to $93 a year.

Unplugging one small appliance, such as a fax machine, one computer monitor, and one television when you aren't using them will save you about $6 a month, Stroh said.

Plugging electronics such as computers, televisions and DVD players, and small appliances such as coffeemakers and microwaves into a power strip, and then turning the power strips off when you aren't using those items will save you even more money, Deyette said.

Heating, air conditioning and laundry : Heating and cooling account for 47 percent of the average household's annual energy bills, according to the U.S. Department of Energy.

The easiest way to cut that expense is to adjust your thermostat.

Every degree you raise your thermostat in the summer shaves 2 percent off of your energy bill, Deyette said. Every degree you lower the heat in winter, shaves 3 percent off the bill.

Install a programmable thermostat : This can lower your heating and air-conditioning bills even more, by about 10 percent, said Ronnie Kweller, spokeswoman for the Alliance to Save Energy, a nonprofit group in Washington.

Programmable thermostats alter the temperature of your house at different times of the day, allowing you to use less energy when you're sleeping or not home.

"If you're spending $1,000 on A/C in the course of summer, it can save you up to $100," Kweller said. "You can still come home to a comfortable house but not at the cost of running the air all day."

They cost as little as $30 and usually can be installed by the homeowner, Deyette said.

Laundry day is another cost-saving opportunity.

A family that washes seven loans of laundry a week can save about $5.25 a month, or $63 a year, in water-heating bills by washing clothes in cold water, Kweller said.

Old-fashioned line-drying will save you even more.

"A new electric dryer can use 4,500 watts per hour," more than almost any other appliance in your home, Stroh said. Old dryers use even more.

"Hanging your clothes out to dry will knock nearly $10 a month off of your utility bill."

Maximize your savings

You really can save money being more energy efficient, Stroh said.

"It's an easy -- and good for the environment -- way to stash $50 a month with only a few simple changes," Stroh said.

It might not seem like a lot of money, but it can add up to $600 or more each year that families can use to pay down credit card debt, boost their emergency fund, or save in a retirement account or college savings plan, Stroh said.

"Investing $50 a month at 8 percent interest for 30 years produces a nest egg of nearly $75,000," said Greg McBride, senior financial analyst with Bankrate.com. "That will go a long way toward improving retirement security."

Using those savings to boost your monthly credit-card payment from $75 to $125 would allow you to pay off a $3,000 balance at 18 percent interest 2 1/2 years faster and save you $860 in interest charges, he said.

The little bits of money you save here and there really add up.

"People that are successful at building wealth over the long term are the people who watch the smaller expenses just as closely as larger expenses," McBride said.

But the key is to save the money, rather than spending it "on some flashy thing," Stroh said.

Once you've made some changes to reduce your energy bills, the easiest way to make it pay off is to transfer the amount you expect to save each month into a savings or investment account, McBride said.

"You have to pay yourself first."

Denise originally wrote this article for the Columbus Dispatch in 2007.

Fight for your right to line dry

My mom likes to show my friends an embarrassing picture of me. I’m 3 years old, hanging on to my favorite blanket as it’s drying on the line.

Laundry hanging on the line, drying in the breeze, was a frequent part of my childhood, and probably yours too. I didn’t even think about it. It was just something that everyone did.

But when I hung a laundry line in my own backyard this summer, I realized that hanging laundry outside has become a hot button issue, not just in my neighborhood, but all over the country. Two hours after I hung my first load, there was a knock on my door. A neighbor I had only met once was on the porch, arms waving, furious. He was disgusted that we had hung a laundry line. He said we were bringing down property values and that only “poor white trash” would resort to hanging their socks and T-shirts outside in the breeze.

I was flabbergasted. But also confused. I might have believed that I was junking up the neighborhood, except that the line was in my back yard, not visible to the street, and visible to this one neighbor from only one room in his house.

After some research, I realized that many people share his sentiment. Homeowners associations all over the country have banned laundry lines, saying they disturb neighbors and bring down property values. Considering almost 57 million Americans live in a subdivision governed by a homeowners association, it is tantamount to an all-out attack on a staple of frugal living– the laundry line.

It seems the simple laundry line has fallen out of favor, now that more than 80 percent of all Americans think a clothes dryer is a necessity. How far we’ve come from summer afternoons hanging laundry in my grandmother’s backyard. And, from the days when an iron clothesline secured in a concrete foundation was a staple in most backyards.

Simply put, homeowners associations and municipalities that have clothesline restrictions associate laundry lines with poor people. After all, the thinking goes, only the poorest Americans don’t have access to a dryer and if you have a dryer, why wouldn’t you want to use it?

I guess I’m old fashioned. I thought line drying just made my clothes smell nice. Why pay Tide or some other company for dryer sheets that try to mimic the smell of outdoors when you can get the real thing for free?

Plus, in an era when households are loaded with consumer debt and are watching their energy bills spiral upwards, line drying is an eco-friendly, simple way to save money.

If you are like me and love your laundry line, take heart: you aren’t the only one left. Some are taking up the mantle of line drying. The states of Vermont, Connecticut, and New Hampshire have proposed legislation protecting residents’ rights to have and use laundry lines. A nonprofit, LaundryList.org, has sprouted up to fight for those whose right to line dry are under attack.

Even if you live in an homeowners association, you can lobby to have the rules changed. But you have to convince your neighbors that your socks swaying in the breeze won’t bring down their property value, which can be a hard argument to make in a shaky housing market.

I’m lucky that I don’t live in a neighborhood governed by a homeowners association. I just have a neighbor with some very particular ideas about what I should or shouldn’t do on my property. I refused to take down the line and eventually he gave up.

That fight has saved me about $100 a year in energy costs and makes my clothes last longer. Dryers are really hard on fabrics. Where do you think all of that lint comes from?

I am convinced that everyone needs to fight for their and their neighbors’ right to hang their laundry out to dry. Why should you fight for your right to line dry? Because you are also fighting for your right to lead a simpler life, and in most cases, a more frugal and earth-friendly life. How can you afford not to?

Reducing home energy use 101

Update: I figured out this weekend that the furnace shouldn't be burning this many killowatts. We had a malfunction in the installation that caused it to not cycle on and off properly. We had it repaired Saturday. This should help us reduce our electricity usage and keep our house at a cozy temperature.

Earlier, I outlined my plan to reduce our home electricity use by 10 to 20 percent by the end of the year. In a house already filled with compact fluorescent bulbs, this will be no easy task.

My most recent electricity bill arrived in the mail this week, so I now have my benchmark kilowatt numbers. It's enough to make me queasy. 

We used a total of 19405 KwH in the past 12 months. The average U.S. family uses 10,656 kilowatt-hours of electricity each year, or about 888 kwh per month. We were well below average before we installed our new furnace.

Our highest usage months were March, at 4,801 KwH (I think this is because our previous two bills were estimated, and didn't take into account our new furnace), December 2008 at 2,289 KwH, and August, at 1,520.

Our electricity usage has skyrocketed in the past year. I know what the culprit is.

In September 2007, we replaced our 1957 gas furnace with an electric heat pump. Electricity is not my first choice for home heating and cooling. But, we really wanted a geothermal system, which is supposed to be as earth-friendly as you can get. every month where we really needed heat or air conditioning sends our Kilowatt hours through the roof. Even our lowest use month is still twice what it was before we installed the new furnace.

Except for the huge amount of electricity it uses, the furnace has been great. I assume it's also more efficient than our old furnace, which at 50 plus years old was not the model of Energy Star efficiency. Although, I am not skeptical of geothermal's claim to reduce CO2 emissions and instantly turn your home into an Energy Star house. That electricity has to come from somewhere, and where we live, 78 percent of it comes from coal fired plants. But, we'll just have to deal with it and try to reduce our use in other ways. We aren't replacing it again.

In the interest of full disclosure I must admit we have another electricity loving vice: a hot tub. Not the model of efficient use of natural resources, I know. But we are clumsy and tend to get injured a lot playing sports, so we consider it therapeutic. We run the tub from September to July.

So, numbers in hand, our goal is to reduce our usage by 1,940 to 3,881 kilowatt hours a year. Our monthly average use is 1,617 kilowatt hours. Our monthly goal is to reduce usage by 161 to 323 kilowatt hours a month.

These are big numbers. As I said in my earlier post, we are planning to tackle this with a combination of upgrades large and small.

This month, We have already managed to implement part of our plan to reduce our kilowatt addiction.

• We installed the final three Energy Star windows in our house. We began this project last year, but because we are old fashioned, we only do what we can pay for out of pocket. We couldn't afford to do all of the windows at once, so we put off the last three (which we deemed to have less impact on our home's leakiness). Now, all of the windows are finished. The company also came out today to repair some window locks on the first set, so all of the windows should now be securely closed against the freezing outside air. This was our most expensive project, at $1,633.
• We have ordered the new doors for the kitchen. This doesn't sound like an energy issue, but it is. The door between our frozen garage and the kitchen is hollow and lets all that cold air right into the house. This is the second-most expensive project on our list, at $600. It is a close tie with another project slated for the laundry room.
• We have one final task: to find an energy efficient cat door. Put gingerly, the new thick door will cut off access to the "kitty loo", so we need to put a door in it. Hopefully we can find one that doesn't leak. Is there such a thing as an Energy Star cat door? I'm about to find out.

Considering we are midway through out first month, I think we are making a decent bit of progress. It's going to become more of a challenge once the big projects are out of the way, as it will be harder to find places that we can cut. 

On the agenda for this year, to help with this goal,

• We hope to purchase a front-loading Energy Star washer.These are a good bet all around, and should be much more efficient than the top-loading model we bought when we moved into this house. I will do some research on brands and post my findings here.
• Invest in some LED lights, to replace some of the much-used CFLs we have around the house.

Who knows what we will need to do. It seems like every project we do leads to another project we hadn't even thought of before. it seems our house is an onion.

Here are a few resources for those of you like me, who would like to use less electricty:

• Powerscorecard.org has this handy list of 20 things you can do to reduce your electricity usage.
• The U.S. Department of Energy has these tips, organized by power source.
• Wikibooks has a long article of tips, although some are of dubious value.

A personal energy plan for the new year

This year, I wanted to do something a little different with the New Year's plan. I set the typical goals:
Put money in the savings account, fund the Bean's 529 plan. Pay down $3,600 on the student loan. Lose that 10 pounds of baby weight that is holding on to my belly for dear life.

But I wanted to do more. Something sufficiently green to try to get our day to day life more in line with our values. After some thought, we decided to generate a list of earth-friendly resolutions as well. Or rather, an earth-friendly plan.

1. Reduce our electricity usage by 10 to 20 percent by the end of the year.
The next electric bill we receive will set the benchmark we will use to gauge our progress. It lists our month-to-month usage for the past year.

Hubby and I both would like to put solar panels on our house, but frankly, our electric bill is enough to make your jaw drop. That's not particularly conducive to solar panels. The first thing the installer will tell you is "Conserve." It saves you money on your solar installation because you'll need a smaller system to cover your needs, and it's much cheaper and easier to save energy than it is to generate it.It'll also save us money on our bill, and considering our utility plans to raise rates 45 percent in the next three years, why not start now?

The question now becomes how do we reduce our usage? We have developed a short plan, that I am sure we will have to add to later.

• Insulate the garage door. We have an electric heat-pump furnace (a geothermal system, so it's the most eco-friendly you can get, but it still burns a lot of electrity.). It runs constantly in the winter, in part, because the garage chills our kitchen to the bone. We have only a hollow-core door standing between the kitchen and the freezing garage. Step one is to replace that door with a solid door, and step two is to insulate the garage. It should cost us about $200 to $300 to do this, and will increase our comfort in summer and winter.
• Replace three windows with Energy Star windows. Last winter, we replaced most of our single-pane aluminum windows with Energy Star replacement windows. But, being finance geeks, we only do what we can afford to pay cash for, and we couldn't afford to do all of them. We chose three windows that had the least impact on our energy bills, and decided to wait on those. This is the year to finally replace those three windows. We have put in the order, and it is going to cost us $1,644 to have those windows made and installed.
• Invest in a Kill-a-Watt and use it to find out what our biggest energy drains are, and address those.
• Tackle vampire electricity. The energy your appliances and electronics suck on when they are supposedly turned off is probably adding a huge sum to our energy bill. We have a lot of electronics, so the plan is to hook them all to power strips and shut the power strips off when we aren't using the electronics in question. This will probably seem like a hassle until we get in the groove.
• Replace our washer with an Energy Star, front-loading washing machine. When we bought this house, we were living out of a storage space and recovering from Hurricane Katrina. Our house didn't come with any appliances, so we had to buy all of the big-ticket items at once: fridge, washer, dryer, etc. I admit I probably didn't buy the most efficient on the market, because I had to keep an eye on the price tag. Now that we are settled, I want to replace our washer with a more efficient version (a la scratch and dent to save money).
• Add laundry lines to the basement and the backyard. Dryers eat up a lot of energy. They don't even have Energy Star dryers. Hubby loves to line dry. Me, not so much. I guess I hate having crunchy towels and underwear. Call me old fashioned.But I do recognize that dryer use adds up, and to encourage line-drying I need to make it easy and ample. As an added bonus, every time we line dry I will add 25 cents to the vacation fund.
• Switch from compact flourescent to LED lights. This may not be practical in every lamp and socket, but one by one I'd like to change out the bulbs that make sense. It may also be a slow project, as LED bulbs are very expensive. There comes a time when we can even do better than compact flourescent bulbs. They are a great technology but if you want to go greener, you've gotta move to LEDs.
• Pay for an energy audit. I'm sure we've missed something. We may be able to insulate or plug up leaks and do even better. 

We also have some other green goals for the year. 

• Produce 100 pounds of veggies and fruit. I want to grow a lot of organic, lovely veggies at home this year. We enjoy eating out of the garden and it'll be good for the Bean to see where food comes from. I'd like to plant dwarf sweet cherry or apple trees for future fruit production, but I'm not sure where to put them. I want to  build planter boxes for the front porch, which will be used for a kitchen herb garden. My goals is also to preserve or freeze everything we grow this year. No waste. This will mean I have to learn some new skills, but it should be interesting.
• Plant a row for the hungry. I will plant extra veggies and donate it to the Mid-Ohio Food Bank. I also hope to get my neighbors involved, by asking everyone in my neighborhood to drop off excess produce at my house twice a week, and I will then drive it to the food bank. I don't know if they will be willing, but it can't hurt to ask.
  
• Add three more rain barrels. If I can find food-grade barrels at low cost, I will attempt to make these myself. If not, I will buy them. Water rates are rising 10 percent next year, which is added incentive
• Make a second composter. One composter isn't enough. We have had to throw away compostable material while we have waited for our current batch to finish. I'm not sure if we did something wrong, but hey, it was our first try.
• 
• Foster habitats for native species. The only way I know to do this is a butterfly garden, and making a bat box. I will search the OSU extension office Web site for more tips.
• Further reduce plastic bag use. We need to be super vigilant and remember to take reusable bags with us everywhere. This may mean acquiring many more reusable bags and stashing them everywhere, so no matter where we are, we have a bag. My favorite so far are the DIMPA bags from IKEA. They are strong, cheap, pretty and hold TONS of stuff.
• Reduce the amount of garbage we produce. Can we do better? Probably. This means thinking more about packaging, about reusing before we recycle, buying in bulk, etc.The composter will help with this, but it's not the only solution.
  

Do you have any eco-goals for 2009?

A quick guide to saving energy and water

This graphic originally appeared with a story Denise wrote for the Columbus Dispatch in 2007.