February 1st, 2021 by John Farrell
Originally published on ILSR.org.
While ENERGY STAR® and other energy efficiency labels are familiar to many, purchasing appliances with energy saving technology is out of reach for many people.
In this episode of Local Energy Rules, host John Farrell talks with Marti Frank, principal at Efficiency for Everyone and founder and director of the Shift Consortium. Frank and Farrell discuss the Shift Model: an approach that uses utility rebates to shift home appliance sales to more efficient models.
Listen to the full episode and explore more resources below — including a transcript and summary of the conversation.
Fighting for Affordability
Efficiency for Everyone developed the Shift Consortium to further their work addressing climate change and social inequities. Developed through Frank’s decade-spanning experiences as an energy evaluator in California, she says that the Shift Model pushes consumers, retailers, and manufacturers alike to think differently about appliance rebates and energy efficiency.
Frank’s work started with a question: why were ENERGY STAR® refrigerators only representing about 50% market share, when it seems like every refrigerator in the stores and in advertisements bears the label?
When she asked manufacturers that question, Frank explains, they said that efficiency is an added feature with added production costs.
Retailers, on the other hand, have a more complete picture of who is and isn’t purchasing energy efficient products.The cheapest appliances represented a large amount of the retail sales. Frank recalls retailers saying, “We sell a lot of cheap products. In fact, we call this the volume price point.”
It’s a price point where an additional $50 for ENERGY STAR® efficient features still represents, in some cases, 20 percent or more in markup. This barrier, says Frank, is one that the Shift Consortium is working to break down.
“This is not a one size fits all approach. Retailers are fickle. They change their minds and they change their policies. They change their assortments. And so we have to be able adapt to that as quickly as possible.”
Taking On an Uphill Battle
The average, low-cost washer is still using similar technology to what it was using two or three decades ago, Frank explains. At the same time, energy efficient models at the higher price points continue to develop and improve. The lack of demand for low-cost, energy efficient models of appliances disincentivizes manufacturers from creating low cost options.
Another issue Frank describes is the prevalence of “bells and whistles” that come bundled with the energy efficient models. For example, lowest-cost refrigerators have wire shelves. The lowest-cost, energy efficient models not only improve efficiency, but come with glass shelves.
“As we see the baseline requirements for efficiency go up and what we almost always see is we see manufacturers continue to innovate, right?”
Price-sensitive shoppers cannot afford these bells and whistles, but by opting out of premium features, they are also opting out of the energy efficiency that saves money in the long run.
Start with the Low Hanging Fruit
Despite marginal individual returns, Frank says, the impact of thousands of households using more efficient appliances is significant.
Providing the rebates that cost-conscious appliance buyers need in a shorter time frame is critically important and can provide insights for other cost leveling measures. Electric vehicles, ductless heat pumps, and more need to see continued cost reduction measures in order to see mass adoption and greater effectiveness.
Frank mentions important findings from the Shift Consortium’s recent research.
“What I can tell you is that two numbers to me are really important. One number is 91%: that is the proportion of people who know the ENERGY STAR® brand,” she begins. “Then there’s this other number and that’s 44%. And that’s the proportion of people who say they’ve never bought an ENERGY STAR® product.”
Such a wide gap needs to be filled somehow, Frank says, but without the resources to do so, most buyers can trade efficiency off. Without making efficiency affordable, buyers can and do reconcile their values with their pocket books.
“The ideas behind shift as a concept are applicable to many aspects of climate change policy where the efficient, or the low-carbon, or the renewable solution is more expensive. The idea of focusing our resources on improving affordability and increasing adoption by our least resourced households has really big, cascading benefits.”
See these resources for more behind the story:
For concrete examples of how cities can take action toward gaining more control over their clean energy future, explore ILSR’s Community Power Toolkit.
Explore local and state policies and programs that help advance clean energy goals across the country, using ILSR’s interactive Community Power Map.
This is episode 122 of Local Energy Rules, an ILSR podcast with Energy Democracy Director John Farrell, which shares powerful stories of successful local renewable energy and exposes the policy and practical barriers to its expansion.
Local Energy Rules is Produced by ILSR’s John Farrell and Maria McCoy. Audio engineering for this episode by Drew Birschbach.
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