Energy Savings Just Don't Add Up -- What Am I Missing?

Our local electric utility has now jumped on the peer comparison bandwagon by sending us information in our monthly bill showing us how much electricity we use in comparison with our neighbors. Well, let's get this out of the way right now -- my wife and I used 15 percent more electricity than our neighbors averaged in the last year. The idea behind this billing procedure is that we energy hogs can be embarassed into using less electricity when shown how virtuous our neighbors are.

In fact, a recent study found that consumers subjected to a peer comparison billing experiment in the Puget Sound area reduced their electricity demand by 1.2 percent and those in Sacarmento cut their use by 2.1 percent. Amusingly, that same study cited a recent survey of other peer comparison studies which found that telling people how much their neighbors use can backfire when energy misers decide that it's OK for them to start keeping the lights on when they are out of the room and air conditioner cranked up.

Another feature of this effort at power shaming is that consumers are offered what is called in the trade "targeted energy efficiency advice." In our case, the "Great investment" described as "A big idea for big savings" is to buy an Energy Star rated refrigerator. Energy Star is a program that rates the energy efficiency of appliances and other products run by the U.S. Department of Energy. In this case, Energy Star refrigerators must be 20 percent more energy efficient than the minimum federal standard.

So how much could we save if we replaced our old refrigerator with a new Energy Star appliance? The bill of shame tells us that we could "save up to $35 per year."

A quick Google search finds a several, but a medium priced one -- a Whirlpool 21.7 cu. ft. -- that is about the same size as our current one costs $864. At $35 per year, it would take 24 years to pay for that refrigerator. Gaia forfend that we buy $1,470 Frigidaire! That would take 42 years of energy savings to pay off. I also note that investing that $864 at 5 percent compounded interest yields $2,786 in 24 years.

Of course, if our old refrigerator breaks down, we'd likely replace it with a more energy efficient one. That being said, I may be confused, but I can't see why buying a new Energy Star refrigerator is a good idea financially. And let's not get into the carbon debt that replacing the old refrigerator with a new one would incur. What am I missing?