Eco Investor February 2020
Electrify Everything and Save on Energy Costs
By Victor Bivell
The best way to lower your total energy costs and your carbon emissions is to electrify everything and get off the petrol and gas grids. But it takes capital, so most people have to do it slowly. It took me six years, and went like this.
In 2014 I replaced our very old gas hot water system with a solar hot water system with electric boosting.
Also in 2014, I switched our home lights to LEDs; and installed insulating glass for our rear sliding doors and kitchen windows.
In 2016 I replaced our gas cook top with an induction cook top and got off the gas grid.
In 2017 we installed an awning on our master bedroom window.
In 2018 I got a 4.55 kilowatt roof top solar system.
In October 2019 we added ceiling fans to the four upstairs bedrooms.
And in December 2019 I got the last big missing piece - an electric car.
Before the changes, our electricity bill was $1,769, our gas bill was $960, and I estimate the petrol for the short city trips in my old V6 car plus the servicing costs was about $3,000.
Our latest 12 month electricity bill for the home is $794, we have no gas bill, and I expect to pay about $200 to $300 to run the electric car.
On those numbers I have lowered our total energy costs from $5,729 to what I expect will be around $1,000 to $1,100. That's an annual saving of over $4,600.
The capital outlay for these changes was $41,547.
The costs, starting with the most expensive, were:
- Electric car including the ownership transfer and stamp duty: $17,638.
Yes, $41,547 is a lot of money. But many people spend that sort of money and more on, say, a new car or an expensive family holiday.
Others can afford it by spreading the capital improvements over a period of time, as I did.
A key financial benefit of the improvements is that they reduce annual outlays and in the long term save money. In my case, annual savings of $4,600 will recoup the $41,547 capital cost in about nine years. Spreading the improvements over time means that the savings start immediately so I am already well on my way with the solar hot water system, the LEDs, the induction cook top, the awning, and the rooftop solar system.
Another key financial benefit is that the improvements add to the value of the house. While the added amount is hard to quantify, it is possible that the total capital cost and any profit on this could be realized earlier if the house is sold before the savings recoup the cost.
With hindsight, there is only one thing I would do differently if I were doing it now. The insulating glass on the back doors was installed to retain heat in winter so the dining area was warmer on cold days. We think it has been of only marginal benefit. I measured only about a 1.5 degree improvement. In hindsight we may have been better off to have chosen the more expensive option of double glazing.
While I have come a long way, there are a few more things I would like to do.
Our 14 solar panels have been a great investment, and as we now have the electric car I feel a few more would be money well spent.
So the next step I am look at is adding some more solar panels. I have worked out how to add at least four and possibly five. We have 325 watt panels so another four or five will bring our 4.55 kilowatt system to 5.85 or 6.175 kilowatts capacity. A few years ago that was not possible on our wiggly east-west roof.
The idea of a home battery is in the maybe-one-day zone. There is a role for a battery to cut into our evening and winter grid draw in particular. But we have reduced our power bill by so much that battery costs will have to come down a lot more to make it worthwhile. So I am in watch-that-space mode.
Further out, a wish-list item is installing double-glazed windows, but we have enough windows for the cost to make that seem unlikely.
New appliances of course need to be energy efficient, and over the six years we updated our air conditioner, dish washer, washing machine, and portable fans. Still to do is our 23 year old fridge.
From the start, the plan was to electrify everything and get off the gas grid, get off the petrol grid, and reduce our reliance on the coal grid. It has been worthwhile both financially and environmentally, and was a lot of fun too. #
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