We live in a day in age where there is a lot of talk about the importance of being “green”. Rightly so, much of the focus has been on the harm that the burning of fossil fuels has done to our environment, and a need to reduce our (the human) impact on this fragile ecosystem that is Planet Earth. Many paths to “greenness” have been offered: solar panels on the roof, CFL light bulbs, energy-efficient appliances, window insulation, etc. etc. Even so, you will find that most Americans do not take these, or many other, steps toward saving Mother Earth. If the recent Shelton Group survey is any indication, folks are actually increasingly likely not to take these steps toward being green.
Why is that?
Well there are probably a multitude of reasons: Maybe some people don’t know that the aforementioned steps exist. Maybe it’s inertia – people aren’t accustomed to taking green actions so they continue not to take green actions. Maybe it’s the cost of being green….it’s this last one in particular that I want to address. There is this perception by many that leading a green lifestyle is expensive. This perception breeds discouragement and this discouragement motivates inaction. I won’t dispute that many of the most popular green actions do have an upfront cost associated with them (especially in the case of installing solar panels), HOWEVER if we change the frame of reference within which we consider our green actions, maybe those upfront costs would be more palatable.
What do I mean?
What if being green has NOTHING to do with saving the environment and EVERYTHING to do with saving money? That’s right. As beautiful as Mother Earth is, and as worthy a cause it is to keep her beautiful, let’s ignore her for just a minute. That’s because many of the same actions that one would take to be green, one SHOULD take to save money. Let’s look at the very definition of “energy-efficiency”: to reduce the amount of energy required to provide products and services (thanks Wikipedia!). I will add: without diminishing the quality of these products and services. And in many cases, actually increasing the quality of these products and services. At the core of energy efficiency, we are trying to do more with less, and less energy means less money.
Now that we’ve established that definition we can look at other areas in our lives where we have tried to be financially responsible. You will find that there are few instances in which you have tried to save money or make additional money that didn’t have a cost associated with them:
- In order to grow your 401k in the long-term, you reduce cash expenditures in the short-term.
- Putting money aside to pay down credit card debt assumes you’re not spending that money on something else (again, a short-term cost for a long-term gain)
- Houses, land, stocks, bonds, gold generally aren’t free, yet you purchase them in the hopes that they will provide some return on investment in the future
Buying CFL light bulbs is no different. When making an energy-efficient purchase, don’t think only in terms of absolute costs. Also consider the fact that your energy costs will be lower, and that these savings will eventually offset the original investment. All savings after that are icing on the cake! (and additional cash that you can use to buy houses, land, stocks, bonds, gold, etc.)
Explore rebate/incentive programs from your local utility
Most, if not all, major utilities have a vested interest in, and/or are mandated by the State in which they operate, to offer programs that help consumers reduce their electricity consumption. These benefit the utility in reducing demand on the grid during peak times, and it makes politicians look good when they can say that they are helping the environment by reducing electricity consumption within their State. I live in Chicago, and a simple search of rebate/incentive programs offered by ComEd shows that there are a host of options available. Just to list a few:
- Discounts on CFL light bulbs at participating retailers
- They will pay me to recycle my old inefficient refrigerator (and will pick up the old fridge for free)
- ComEd will provide rebates on purchased ENERGY STAR appliances
- I can earn up to $750 in rebates if replace my old heating and cooling system
- They will provide a 50% discount on the cost of a home energy assessment
- My utility is even willing to finance major appliance purchases at a low interest rate
You should check your local utility website for similar incentive programs if the cost of energy efficiency scares you (or if you just want to save more money).
Explore federal tax incentives
The federal government offers a number of tax credits for investing in a green lifestyle. They include (and this is by no means an exhaustive list):
- A $500 tax credit for buying and installing energy-efficient windows, insulation, roofs, doors, air conditioners, and central-heating units.
- A tax credit equal to 30% of the cost of a geothermal heat pump or a solar energy system (and this credit has no upper limit and applies to both your primary residence and your second home).
- You can receive a $150 tax credit for a gas, oil, or propane furnace or hot water boiler.
- There are generally a number of tax incentives offered at the state level as well.
Don’t forget that green doesn’t just save you money
As noted in a previous article, when you’re shopping for a home, you may notice that your local Multiple Listing Service (MLS), a listing of homes/apartments on the market, along with number of bedrooms, square footage and amenities lists the green features associated with a particular property. The reason being, that green features are being increasingly considered when assessing the value of a property. That means that many of the investments you make in energy-efficiency that will save you money on your electricity costs may ALSO increase the value of your home. That’s even more money in your pocket long-term by making energy-efficiency investments in the short-term.
What are your thoughts on this? Please share in the comments section as always.