NeutralAxis

BusinessWeek.com is reporting that this fall as part of the federal stimulus package, there will be a rebate program for home appliances similar to the Cash For Clunkers automobile program.  Certain appliances will be eligible for rebates of $50 to $200 and the old appliance will not be required to be turned in.  This sounds like a great thing for the manufacturer’s but I can’t help thinking its going to prompt a whole lot of people from spending money needlessly on new equipment thinking they’re getting a good deal.

The main offender the program targets are refrigerators.  But as I demonstrated in a post earlier this year, the amount of energy consumed by a refrigerator isn’t really all that significant.

My measurements and calculations from that earlier post on a 1994 GE refrigerator showed that I spend approx. $50 annually on its electricity.  The most energy efficient modern refrigerator I had found at the time, using only 60W, would cost around $20 annually to run in my home under my usage patterns.  But it cost $2200 to buy.  The payback period would be nearly 75 years.  Even with a $200 rebate, the payback would still be around 66 years.

Now its possible that the $200 rebate could be applied to a much less efficient, and much less efficient refrigerator.  So how efficient would a $800 refrigerator ($1000 refrigerator – $200 rebate) have to be to have a 10 year payback?  It would have to save $80 a year which isn’t possible if the most efficient model can only save $30 a year.  How about a 20 year payback?  Nope, that would still only save me $40 a year.  30 year payback?  Now we’re talking something more reasonable.  That would be a $26 savings, which is conceivable, but probably still too high for that cheap a fridge.

Basically, don’t buy a new refrigerator until the old one dies.  And when it does, cross your fingers that there’s a rebate program under way.  Your mileage may vary however, based on your electricity costs and usage patterns.  I have no doubt that a household with several children would have a higher refrigerator runtime than mine.

See my earlier post for additional supporting data.