Energy-efficient appliance prices trap low-income residents in cycle of high bills

The money Malika Francis owes to her utility company isn’t even at the forefront of her mind anymore.

“That’s just everyday life,” she said. “It’s just you pay or you don’t. I’m really mute on it because I can either pay it and keep my life going, or not and face the consequences.”

A 25-year-old single mom, Francis doesn’t have any outside financial support for her family. She clocks in hours at McDonald’s so she can rent an apartment in Kansas City. Sometimes her sister will help with her four children, but when it comes to money, Francis is on her own.

She’s fallen into debt with her electricity provider, Kansas City Power & Light. It happened a few months ago when she first moved into her current apartment and forgot to change her billing address.

“I’m trying to get caught up,” she said. “You know, you never get caught up. It’s impossible. I only get paid every two weeks, and I don’t get paid that much.”

Francis is moving to a different apartment complex soon, one that’s being remodeled.

“I’ll be moving to a better one with more systems, the air and heat and stuff will be newer,” she said. “So maybe it (my bills) won’t be so high.”

Not everyone has a chance to upgrade to a more efficient place. Most people who struggle to pay their utility bills every month often find themselves in a seemingly endless cycle of high costs.

Utility costs depend on energy consumption, and one of the most effective ways to decrease energy consumption is by upgrading to high-efficiency appliances. For people who pinch their budgets to pay the bills they already have, that kind of upfront investment is unthinkable.

Without more efficient appliances, monthly bills won’t decrease. And without a lower bill, there’s no way to save up for high efficiency products.

And around it goes.

Even with the available rebates and tax credits, it takes disposable income to access long-term solutions to expensive utility costs.

Take a refrigerator. It can be the biggest energy-guzzler in a home. According to a tool on Energy Star’s website, if a Missouri resident wanted to get rid of a standard-size fridge with a top-mount freezer from 1996, for example, and upgrade to a more efficient model, they would save more than $220 over five years. A Kansas resident, whose electricity rates are a bit higher, would save $235.

Getting rid of an even older fridge, say one from before 1980, would mean savings of more than $955 over five years.

All of that savings comes through in lower utility bills, but it takes years to get back the money spent initially on the refrigerator. Waiting that long for a return doesn’t work if you’re already squeezed for funds.

A typical American household spends more than $2,000 every year in utilities. By switching to energy efficient products, people can reduce their bills by 35 percent according to Energy Star, the efficiency standard that identifies appliances that provide significant energy savings.

The Metropolitan Energy Center, a local nonprofit organization that promotes resource efficiency, helps facilitate appliance upgrades. Executive Director Warren Adams-Leavitt said most people applying for rebates are homeowners in the upper- and middle-class. It takes disposable income to make a home more energy efficient.

“The improvements pay for themselves over time, and the rebates make that more attractive,” he said. “But you have to have the wherewithal to make that investment. You have to have the ability to invest.”

Rebates will rarely cover all of the costs of home improvement, and they aren’t intended to, Adams-Leavitt said. The real savings come over time, through lower utility bills.

Most rebates come from utility companies. Depending on where someone lives in the Kansas City metro area, they could have access to up to $1,200 in rebates, Adams-Leavitt said.

Kansas City energy providers Kansas City Power & Light and Missouri Gas Energy both offer rebates for up to $600. If a home is in both companies’ coverage area, it could qualify for both — a joint rebate.

Power & Light just started offering those rebates for the KC metro area this month, said Katie McDonald, Power & Light’s director of corporate communications.

“Across the board, we’ve found customers are interested in us offering them,” McDonald said. “Because regardless of their socioeconomic status, customers have been very interested in reducing their bills.”

To qualify for a rebate, you have to first hire an auditor. An auditor will produce a report that indicates the flaws in a home and make recommendations about how to make the home more efficient.

Residents are expected to pay the auditor themselves, who typically charge about $400, Adams-Leavitt said. They can use the rebate they receive from a utility company to cover the expense. To get the rebate, though, they must follow through on some of the auditor’s recommendations.

Energy auditors should produce a report on a home looking at factors like air flow, air leakage and insulation. They should also check that appliances are working properly and safely.

Federal tax credits are available are certain products as well, but only for certain products like geothermal heat pumps, small wind turbines, solar energy systems and fuel cells. The credit covers up to 30 percent of the cost.

The process to upgrade a large appliance just isn’t cheap, no matter how much money you receive through rebates and tax credits.

But there are ways to decrease energy consumption on a tight budget, said Brittney Gordon-Williams, a spokeswoman for Energy Star.

Upgrading to high efficiency appliances like refrigerators, air conditioning units and furnaces would make a dent in energy costs. But smaller changes, as small as your light bulbs, can also have a big effect.

“A lot of times, we do tell people that our entry point is lighting,” she said. “Because we understand it may not be possible to invest in (other) high efficiency products.”

Replacing the five most-used light bulbs in a home with Energy Star-labeled bulbs, which use 70 percent less energy than an old-fashioned bulb, can save up to $80 a year.

And the cost of high-efficient bulbs is coming down, Gordon-Williams said. Lighting tends to make up about 12 percent of utility costs.

“Financially, there really isn’t any reason for people, no matter how much money they make, to not buy energy efficient light bulbs,” she said.

Setting a programmable thermostat properly can save $180 and people tend to waste about $100 powering devices that are not in use every year.

“That’s just an easy way to save money,” Gordon-Williams said.

And if that’s a stretch, there are weatherization income assistance programs.

“Weatherization funding helps make people’s homes more efficient,” Brandon Avila said. “A lot of the homes might have old windows, old doors, so they’re using up more power than these high efficiency homes.”