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Smart Money

How to Create an Energy-Efficient Home to Save Money

Working to make your home more energy efficient doesn't have to involve expensive upgrades or months of renovations. Making a few changes — big or small — can significantly impact your monthly utility bills while also making your home more safe and comfortable.

Rachel Velez • April 8, 2022

In This Article

  1. What does it mean to have an "energy-efficient" home?
  2. How to make your house more energy efficient: 14 tips
  3. Finding energy-efficient buildings when apartment hunting
  4. FAQs
  5. Final thoughts

According to the U.S. Energy Information Administration, the average electricity use for a residential utility customer in 2020 was 10,715 kilowatt hours (kWh). This breaks down to an average use of 893 kWh of electricity per month, making the average monthly bill over $100. Needless to say, those monthly bills add up fast. So, why not adjust some things around your house to lower your energy usage a little bit and save some dollars along the way?

The greatest share of energy used in households is spent on basic utilities like heating and air conditioning. Advancements in technology and new innovations have made it easier to trim that usage to help save you money. You can improve your home’s energy efficiency and reduce your environmental footprint by making some low-cost and big-ticket changes. Either way, getting started is the key to making a difference sooner rather than later. 

What does it mean to have an "energy-efficient" home?

A lot of people talk about being more energy-efficient when it comes to their homes, but what does that actually mean? An energy-efficient home is designed to conserve and reduce energy use. These types of homes also cut back on greenhouse gas emissions and demands for nonrenewable resources. Energy-efficient homes also provide healthier living conditions and offer homeowners significant money savings. 

Many factors can contribute to a home’s overall energy efficiency, and both new and existing constructions can be improved with certain strategies and products. Ultimately an energy-efficient home is:

  • Cost-effective
  • Comfortable, safe, and healthy
  • Continuously adding value
  • Better for the environment

Although energy-efficient home improvements might not sound as exciting as renovating a bathroom or installing a pool, improving your health and comfort while reducing energy bills is still a win-win situation. 

Some of these energy-saving tips can only be implemented in a home that you own, but there are some renter-friendly options that might get your landlord’s stamp of approval. Check out these 14 ideas, both big and small, that will work together to make your living space more energy efficient.

How to make your house more energy efficient: 14 tips

1. Perform an energy audit

Consider hiring a professional energy auditor to evaluate the inefficiencies and wasted energy in your home. A certified and trained auditor will inspect your home, inside and out, to pinpoint savings opportunities and identify areas that need improvements. Auditors typically charge by the square footage of your house or by the hour. Many utility companies even offer a free home energy audit to their customers. 

2. Seal or upgrade windows

Without an airtight seal on your windows, you’re wasting energy when heating and cooling your home. If your windows are old and leaking air, it may be time to replace them with energy-efficient models or to boost their efficiency with weatherstripping. While this can be costly, you’ll likely experience immense savings in the long run.

3. Buy ENERGY STAR appliances

If you’re in the market for a new appliance, consider purchasing a product with the ENERGY STAR label, which uses considerably less energy. There are more than 40 product categories that offer the ENERGY STAR label, including major appliances and light fixtures. ENERGY STAR products, such as refrigerators, televisions, stoves, washers, and air conditioners, meet energy-efficient specifications set by the Environmental Protection Agency (EPA)

ENERGY STAR appliances use up to 10 to 50% less energy than standard appliances and help reduce emissions of greenhouse gases. It’s important to note that many energy-efficient appliances are more expensive to purchase than traditional appliances, but these upfront costs actually save you money in the long run. 

4. Get a tankless hot water heater

Water heaters are big energy-consuming appliances. Tankless versions, or “on-demand” water heaters, use less energy, last longer, and help cut down on hot water energy costs.

5. Install storm doors

Storm doors are a great way to prevent unnecessary energy loss. Even if you have an energy-efficient exterior door, adding a storm door gives you an extra layer of protection from harsh weather conditions year-round. Storm doors typically have low-emissivity glass or a protective coating that can help reduce energy loss. Most storm doors last between 25 and 50 years, and the installation rate generally starts at around $75.

6. Improve your insulation  

Improving your home’s insulation is one of the most affordable ways to reduce energy loss and save on your electricity bill. Heating and cooling costs account for a large chunk of your home’s energy tab, and you want to keep the hot or cool air inside your home. 

To save energy, seal gaps and cracks in your attic and basement and around windows and doors, and make sure your home insulation levels meet or exceed your local codes. The U.S. Department of Energy has an online tool that can help you determine if you have enough insulation based on the region where you live.

7. Schedule yearly HVAC maintenance

You can increase the efficiency of your heating, ventilation, and air conditioning (HVAC) system by having it inspected and cleaned at least once a year. An annual tune-up on your HVAC system will ensure that your furnace and AC are running at peak efficiency, which can save you money each month. 

These routine check-ups improve efficiency by ensuring connections are tightened, parts are properly lubricated, and coils are cleaned. And, as an added bonus, you’ll also have cleaner air circulating throughout your home. 

If you rent an apartment or townhouse, this is typically your landlord’s responsibility to schedule and have done.

8. Invest in solar panels

Solar panels are used to convert light from the sun (solar energy) into electricity you can use to power your home. Although solar panels can be expensive to purchase and have installed, they’re becoming more popular to generate electricity for the entire home. They can greatly reduce your electricity bill in the long run, promote lower fossil fuel usage, and can help you qualify for annual tax incentives. Typically, they’re installed on your roof and cut your electricity costs by generating energy independently rather than relying on a utility company. 

Since rooftop solar panels are usually permanently installed, you probably wouldn’t invest in them when you’re renting. However, there are solar charger products that are apartment-friendly for renters. You can hang them in a sunny window to produce enough energy to power devices like your cell phone or tablet. Although it won’t power your entire apartment, it’s a good starting point!

Renter friendly ✅ 

9. Replace incandescent light bulbs

A relatively cheap energy-efficient project is replacing your incandescent lights. Energy-efficient bulbs, like light-emitting diode (LED) bulbs, are a popular option that last longer than incandescent bulbs and cut down on how often you have to replace them. LED bulbs can last up to 25 times longer while using up to 90% less energy.

Renter friendly

10. Unplug unused chargers

This is an easy one, plus it’s free to do! Chargers that are plugged in draw power even when no device is attached. Once your phones, tablets, or other devices are fully charged, unplug the chargers. According to Energy.gov, the average phone charger consumes 0.26 watts of energy when not in use and 2.24 watts when connected to your fully powered phone. Although one charger won’t make a huge impact, multiple chargers plugged in can be responsible for a big portion of your monthly energy bill. 

Renter friendly ✅ 

11. Use cold water when you can

Be conscious of when you’re using hot water, especially with laundry and the dishwasher. Waiting to run the dishwasher until it’s full or turning laundry cycles down to cool-water settings can help save energy and money. Not to mention, washing clothes that aren’t super dirty in cold water can help them maintain their color and shape for longer.

Renter friendly ✅ 

12. Lower your thermostat

Adopt the habit of lowering the temperature on your thermostat while away from home. Lowering the temp by 7° – 10°F for 8 hours a day from its regular setting will reduce your monthly utility bill and use less energy. Think outside of your thermostat, too. For example, shades and curtains can make a big difference with letting in or blocking out the sun’s heat.

Renter friendly ✅ 

13. Change your filters regularly

Routinely replace the air filters in your heating and air conditioning systems. Keep your HVAC system in tip-top shape by changing the filter every 30 to 90 days, depending on the type of filter you have in your system. Factors such as the size of your house, pets, and the overall air quality in your space will typically affect how often you should change your filter out as well. Set a reminder on your phone so you don’t forget!

Renter friendly ✅ 

14. Routinely clean large appliances 

If the vent on the back of the refrigerator or the clothes dryer exhaust vent builds up dust, the motor works harder, which requires more energy use. So, clean the lint trap before you use your dryer. Excess lint can be a fire hazard, but it will also prolong the amount of time required for your clothes to dry. You should also turn your refrigerator off and clean the coil of dust a couple of times a year.

Renter friendly ✅ 

Finding energy-efficient buildings when apartment hunting

Location and space play a big part in rental costs, but another large cost of your monthly expenses is utilities. Water, garbage, heating and cooling, and energy costs should all be considered when completing your apartment search. 

Check for certain appliance ratings and ask the right questions, so you can make sure you get an energy-efficient apartment and save some money, too. Here are some other things to consider before signing the contract for a new apartment:

  • Find out which expenses are included with the rent
  • Ask for the utility bill history
  • Check for ENERGY STAR appliances
  • Ask about the policy on repairs

You can also look for apartment buildings that have the blue ENERGY STAR label. Apartments that have the ENERGY STAR label are designed and verified to be at least 10% more energy efficient than other buildings.

Apartments that earn the ENERGY STAR label also have to go through a series of inspections and testing to make sure that they’re designed properly. This is another way to guarantee that your new apartment is designed to reduce energy costs and lower your monthly utility bills.

FAQs

Are there tax incentives when improving my home to be more energy efficient?

There sure are! You can get tax credits while you’re saving energy dollars. You can receive up to $500 for using ENERGY STAR windows, skylights, or storm doors or adding home insulation, weather stripping, or caulk.

Federal tax incentives are also available for energy efficiency upgrades to existing homes. Improvements may include building-envelope improvements, HVAC upgrades, as well as on-site renewables, such as solar panels.

How do I make an old home more energy efficient?

Older homes tend to have less energy-efficient features since many were built way before energy-saving advancements and technologies were created. You can implement any of the ideas above into an older home, but a good place to start would be to conduct an energy audit to see where your home is currently wasting the most energy. You can also work to ensure all of your windows are properly sealed and your home has proper insulation. 

What is an ENERGY STAR certification?

ENERGY STAR is a program run by the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Energy that advocates for energy efficiency in homes and buildings. A building or a home can earn ENERGY STAR certification, just like an appliance or product. ENERGY STAR certified buildings save energy, money, and the planet by generating fewer greenhouse gas emissions than typical buildings. To be certified as ENERGY STAR, a building must meet certain requirements and performance standards set by the EPA.

What is the Energy Efficient Home Credit?

The Energy Efficient Home Credit lets eligible developers claim a $2,000 tax credit for each newly constructed or substantially reconstructed residence. Examples of housing for which this credit applies include single-family homes, townhouses, apartments, condominiums, assisted living homes, and student housing.

What should I look for when building or shopping for an energy-efficient home?

A home’s construction, appliances, and major features can all impact its efficiency, so there’s plenty to consider when shopping or building from the ground up. When building, it’s a good idea to consult with a home inspector who’s well-versed in energy efficiency to create an appropriate design plan and ensure the right features are incorporated into the home. 

Some additional tips for how to find an energy-efficient home include:

  1. Look for energy-efficient certifications
  2. Use energy-efficient home search sites
  3. Hire an agent who specializes in energy-efficient homes
  4. Request past utility bills for the house
  5. Apply for an Energy Efficient Mortgage (EEM)

Final thoughts

Energy and money savings emerge from taking a look at your everyday habits and your energy-consuming lifestyle as a whole. Prioritize your energy-saving investments and take it one step at a time. Small changes can lead to big results and you can take the time you need to tackle each project. 

While some lifestyle shifts will be easier than others, the fact that you’re actively making a change is what’s most important. From changing your lightbulbs to upgrading your windows, all environmentally friendly actions will likely benefit your wallet and the planet. 

 

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