March 2, 2013

How to spend $600 to cut heating bills?

A proposed LePage administration rebate would be best used to reduce the amount of energy needed to heat a home, not to buy a new system, experts say.

By Tux Turkel tturkel@pressherald.com
Staff Writer

The average Maine home will burn more than $3,000 worth of oil this heating season. To help lower that cost next year, Gov. Paul LePage wants to offer Mainers $600.

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Bruce Merryman, project manager for Evergreen Home Performance, points to an open area around a chimney to be insulated as apartments in South Portland are weatherized last week.

Photos by John Patriquin/Staff Photographer

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Michael Bunker, left, and Eddie Elwell of Evergreen Home Performance wrap insulation around heating ducts while weatherizing South Portland apartments. The most cost-effective way to spend $600 in most Maine homes is on weatherization and air-sealing.

John Patriquin/Staff Photographer

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The money's not to pay for oil, however. It would be a rebate, for taking steps to use less fuel or for switching to a cheaper alternative.

But this offer would involve an important choice: Would the money best be spent on weatherization and air sealing, to cut the amount of energy needed to heat a home? Or would it make more sense to put $600 toward a new heating system, maybe to switch from oil to natural gas?

Thousands of Mainers could be doing this math, if a proposal from the LePage administration makes it through the Legislature this spring.

Three weeks ago, LePage said Maine would continue to participate in the Regional Greenhouse Gas Initiative, the eight-state plan that cuts carbon emissions from power plants, but only if the state's share of revenue from the program is refocused.

LePage wants to shift spending by Efficiency Maine from targeting electric bills to helping homeowners cut their heating bills, which make up the largest share of personal energy costs.

Many details still are being worked out. But Patrick Woodcock, the governor's energy director, told lawmakers last month that he'd like to use at least $6 million from the greenhouse gas program to convert 10,000 homes to high-efficiency electric heat pumps, wood-pellet systems or natural gas or propane boilers.

If each home could save $1,500 a year, Woodcock estimated, it would keep $15 million in Maine's economy.

It is an ambitious and well-intentioned plan, but it faces at least four obstacles that could keep it from achieving its goals, based on interviews with experts and cost comparisons prepared for the Maine Sunday Telegram:

A $600 rebate may be too little to entice most homeowners to spend the $10,000 to $16,000 that it would cost to replace a central heating system with a high-efficiency natural gas boiler or wood-pellet boiler. A $600 rebate is more likely to be used for supplemental heat, such as a wood stove or high-efficiency electric heat pump.

Homeowners who can come up with the money for a new central heating system face a long payback period on the investment. It's roughly six years for a natural gas boiler, at today's energy prices, and nine years for a wood-pellet boiler.

Natural gas is half the price of oil today. And while thousands of homes are within 100 feet of existing gas lines, most residents live too far from them to take advantage of this cheaper, cleaner-burning fuel.

The most cost-effective way to spend $600 in most Maine homes is on basic air-sealing and weatherization, with a payback of less than a year. But LePage's emphasis seems to be on alternative heat rather than building efficiency.

In an interview last week, Woodcock said both strategies would be encouraged. He said Mainers would need to decide the merits of weatherization and fuel switching in their own homes, based on facts that include the age of the home, how long they plan to live there and distance from a natural gas line.

"The bottom line is we want to lower people's energy costs," he said. "And you can do it a lot of different ways."

But Dylan Voorhees, clean energy director for the Natural Resources Council of Maine, said he has some misgivings about the governor's plan. While his group is still considering its position on whether homes that get government money for new heaters should first be air-sealed, he said a policy that "locks in waste" might be shortsighted, especially if natural gas prices rise again, as expected.

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