America at the plug: the proliferation of remote-controlled home appliances and inexpensive halogen lighting may create demand for energy in the next two decades that could cancel out efficiency gains in major appliances

American Demographics, Nov, 1997 by Shannon Dortch

The proliferation of remote-controlled home appliances and inexpensive halogen lighting may create demand for energy in the next two decades that could cancel out efficiency gains in major appliances.

During the energy crisis of the 1970s, most Americans got in the habit of turning the lights out while away from home. Twenty years later, that may be the only thing we do to conserve energy. In 1997, 5 percent of Americans say a potential energy shortage is one of the top two or three things they are most concerned about, according to Roper Starch Worldwide. That's down from 46 percent in 1974, when energy supplies were short and prices high.

Americans appear relatively complacent now about the current availability of residential energy, but they also recognize that ample supplies can't last forever. In December 1994, 58 percent of U.S. adults said a shortage of energy supplies would be a serious problem 25 to 50 years down the road. That share is down from a peak of 68 percent in 1980, but it represents a substantial increase from 50 percent in 1984.

Even with these long-term concerns, U.S. households are gobbling up energy as much as ever, and are expected to increase their overall consumption 17 percent between 1995 and 2015, according to projections from the Energy Information Administration (EIA) of the U.S. Department of Energy.

The increase is anticipated despite huge improvements in the energy efficiency of heating and cooling units, and of many major household appliances. Beginning in 1993, federal regulations required that all new refrigerators sold consume no more than 690 kilowatt-hours of electricity per year-30 percent less energy than used by previous models. Another round of regulations takes effect in 2001 that require an additional 30 percent increase in refrigerator efficiency.

Regulations like these have led to a 4 percent decrease annually since 1987 in energy used by home refrigerators, according to the EIA. And the agency projects about a 2 percent annual decline to 2015, as consumers replace older refrigerators with more efficient models. "Just the turnover effect is huge," says John Cymbalsky, an energy-demand analyst with the EIA. As recently as 15 years ago, home refrigerators used up to 1,200 kilowatt-hours a year. So replacement refrigerators often use 50 percent less electricity than an older unit.

The projections for energy used by home refrigerators also assume that some super-efficient models will be on the market in 1998. This is based on utility-sponsored programs such as the "golden carrot" contest, where refrigerator manufacturers competed in designing extremely energy-efficient home refrigerators. In return for designing and manufacturing these units, the winner's sales were subsidized by the sponsoring utility firms in order to keep prices competitive with less-efficient refrigerators.

Whirlpool Corporation won the contest with a full-featured side-by-side refrigerator that used 30 percent to 40 percent less electricity a year than standard models. The refrigerator sold well, largely because its subsidized price made it competitive with similar models. However, consumers shunned the refrigerators when they were marketed outside the "golden carrot" program.

"We did have trial marketing and that was not successful," says Richard Best, Whirlpool's director of environmental safety and health. "There was just no interest at the non-subsidized price. Once the subsidy disappeared, so did the sales."

"We can't continue to

produce high-efficiency models if consumers

won't pay for them."

That's the problem faced by most manufacturers of home appliances: you can usually produce less energy-efficient appliances more cheaply than high-efficiency ones. Whirlpool and its competitors have the technology to produce efficient appliances, but consumers don't value the long-term savings enough to fork out extra cash for the initial purchase. "We've actually reduced the number of high-efficiency models for competitive reasons," Best says. "We can't continue to produce high-efficiency models if

consumers won't pay for them."

It appears that refrigerator manufacturers won't put their most-efficient technology on the market any time soon, and even if they did, Americans wouldn't buy these units. However, some electricity savings will be realized in 2001, when all manufacturers must comply with the next round of energy standards.

Economists at the Energy Information Administration are also betting on some improvements in how well new and existing homes conserve the energy it takes to heat and cool them. "We have modest gains in the forecast for both new and existing homes," says Cymbalsky, the EIA analyst. "The problem is energy prices in real terms are expected to fall. So we won't have the same rate of improvement as we saw in the 1970s."

New-home builders face the same obstacle as appliance manufacturers-homes with energy-saving features cost more to construct, and many buyers aren't willing to pay the premium. Yet many communities are mandating minimum energy efficiency in new homes through building codes. Energy savings may also be boosted by loan programs that provide extra money for buyers who are willing to add conservation features, Cymbalsky says.