How much you can save with smart thermostat?

How much you can save with smart thermostat?

Some smart thermostats can save you a good deal of money. It turns out you can save upwards of 10-12 percent over what you might be spending now.

At the same time smart thermostat can have quite a steep price to get one. Is it worth upgrading and when you are getting your money back?

Manufacturer claims

According to Nest it can save up to 12-15% on energy bills

Nest claims on average for the US customers it can save up to 10-12% on heating bills and about 15% on the cooling bills. According to Nest it would be $131 to $145 annually. You can calculate how much you can save with the Nest Thermostat in this calculator.

For calculating savings Nest takes into consideration user location, home size, heating type and whether user has an air conditioner installed. It also considers information collected on similar homes in the same area and makes user behavior assumptions.

Ecobee would claim to save you up to 23%

Ecobee thermostat have saved US customers up to 23% on their heating and cooling bills based on the manufacturer study.

Energy savings in ecobee’s case are calculated by how long the heating and cooling system has run to local weather conditions (when target temperature 72°F or 22°C). They are also depend on estimated savings by the user equipment runtime savings, the average electricity and heating fuel rate in the specific area.

According to ecobee individual energy savings will depend on the geographic area, local weather conditions, heating and cooling system type, home size and home energy saving capabilities.

Honeywell would propose to save you $300 a year (at least on paper)

Honeywell offers quite sophisticated Energy Savings calculator, which you can try yourself here. According to the calculator you shall be able to save on average around $179 on your utility bill per year.

By entering my location and using pretty much default values for the area I got $7 savings on cooling and $334 on heating bills per year. In my opinion this is quite significant amount of money to be saved by thermostat. Although it is based on theoretical calculations.

How much you can save with smart thermostat according to studies?

Study in Oregon

The Energy Trust of Oregon has launched a research project to investigate smart thermostat energy savings. It was done on 185 Oregon homes that used heat pumps. The study was conducted over one heating season during year 2013 – 2014.

From 185 homes the 174 of those made through the season with the thermostat installed and working. The researchers looked at the energy consumption before installing Nest thermostats and after.

Study has found that on average homes saved 12% of electricity used for heating after installing the Nest thermostat. Also, more than 60% of participants have indicated that their homes where more comfortable when using Nest thermostat.

Additionally, researchers have indicated that the savings were about twice as high in homes where Nest has replaced programmable thermostat in comparison to the homes where it replaced non-programmable thermostat. This is quite surprising finding.

Homes with the highest energy consumption (1,785 kWh per year) saved most energy. The lowest income group experienced the highest percent savings – 11% (1,654 kWh).

There is a word of caution about those specific sub-segments insights as they are quite small, according to the study authors.

Two studies in Indiana

Both studies were done by two different gas & electric utility companies in Indiana and was conducted by The Cadmus Group. One study looked at 400 homes and the other – 300 homes. They tracked the gas usage during the heating season and electricity consumption during the cooling season.

This study compared energy use in homes where Nest thermostat installed versus home where the standard programmable thermostat was installed (Honeywell TH211). Study compared both cases to the homes with non-programmable thermostat as a baseline.

Results from the study found that the Nest thermostat yielded ~13% energy savings for heating and 16% / 14% for cooling compared to baseline homes. In comparison the programmable thermostat displayed 8% / 5% savings on heating and 15% / 13% on cooling in comparison to the baseline.

Study concluded that Nest thermostat saved more on heating bills in comparison to programmable thermostat, but it showed the same result for cooling.

Florida study

During the Phased Deep Retrofit project in Florida there were 26 Nest thermostats installed in participating 25 homes (22 thermostats in total were evaluated). Before the experiment the full year of hourly temperature and heating & cooling system operation data was available prior to the installing smart thermostats. It allowed to compare and evaluate the changes before and after.

The study has displayed average cooling energy savings of 9.6% (498 kWh/year) with very high degree of variation. From the total sample of 22 the 6 sites have experienced even negative savings, which largely related to the previous thermostat configuration – they most likely were already running efficiently.

Savings from heating were also quite variable, especially during the very short period of Florida heating season. Average savings were 9.5% (39 kWh/year).

The study showed that the homes where current thermostat runs already efficiently and well programmed will not yield much savings when smart thermostat is installed. Homes with high levels of vacancy are expected to experience large savings.

In conclusion it was calculated that the payback for the $250 Nest thermostat is estimated to be 4 years.

How smart thermostat would save you money?

Following or learning your temperature preferences

Smart thermostat allows you to program climate schedule you prefer or turn on the heating/cooling when you need it. You could set specific temperature for the time when you and your family are at home or sleeping and different when the house is empty. This is one of the best and easiest ways to save on your energy bills.

Climate can be scheduled on programmable thermostats as well. However, the interface on smart thermostats usually are much easier to program or they even have mobile application to set the climate schedule.

With learning thermostats such as Nest you can avoid programming at all. To start you need to adjust the temperature manually for a while. Then the thermostat will continue automatically following the pattern you have set. You’ll eventually get to a point where you can leave them alone since they’ll automatically choose the most efficient settings possible.

Remote access

Remote access will be useful in case you prefer to control your climate manually. Most of the smart thermostats has possibility to connect to your Wi-Fi network at home and you can control it over the mobile application.

You can always check your home climate and adjust it from being anywhere in the world. As long as you have an internet connection on your smartphone.

Remote sensors and monitoring occupancy

Some thermostats support remote sensors. Today those are Nest and ecobee thermostats.

Room sensors will track temperature in specific areas of your house. Readings from the sensors are returned to the thermostat, which will make heating and cooling decisions. It then control HVAC system accordingly. The result is that your specific area is as close to the desired temperature possible at the time when you need it.

Remote sensors also allows to track occupancy in each of the rooms separately. Ecobee thermostat has smart Home/Away feature, which uses remote sensors to override your schedule based on occupancy data.

If the movement will be detected during Away period then the climate will be immediately switched to comfort more. Vice versa – when there will be no activity detected during Home period the climate will be adjusted to Smart Away settings to save energy.

Tracking geolocation

In some cases geolocation data is used for saving energy on smart thermostats as well. Honeywell Lyric for example will track the paired smartphone location to make decisions on turning on or off the HVAC system.

Once you get within a few miles from your home the thermostat will set the climate settings for comfort and start heating or cooling based on your preferred settings.

Setting higher temperature during cooling period and lower during heating period

Smart thermostats have access to quite a large amount of good data on home occupancy. They have integrated sensors, room sensors and smartphone GPS location, just to name a few.

By using this data smart thermostat can find perfect opportunities to save energy by keeping temperature just a little higher during cooling period and a bit lower during heating period that you even not notice.

Understanding your heating system performance

Thermostat such as ecobee4 has feature called Smart Recovery. It learns over time how much time it takes for your HVAC system to reach your preferred temperature.

The thermostat then is able to plan in advance when to turn it on to balance the performance and economy to reach the settings you want at the time set.

Weather compensation

Weather compensation is a useful smart thermostat feature which will track how weather conditions affect your heating and cooling system performance.

The thermostat will also take advantage of outside weather conditions to reduce energy needed to heat or cool. For example on a hotter day it will delay the start of heating the rooms, instead of firing heating system right away.

What factors make a difference on how much you can save?

Temperature setbacks

Outside weather temperature usually differs throughout the time of the day.Your home occupancy also differs depending on the day of the week or time of the day. On workdays we usually spend at work and don’t need comfort temperature at home during that period.

Keeping home temperature at home higher when nobody at home during the summer and lower during winter can save 10% energy during a year. Smart thermostats will allow to set specific temperature for those periods or even track occupancy automatically will save you money.

When the day temperature fluctuates a lot the smart thermostat can help you follow the pattern much better. Also, if you prefer manual adjustments you can do it by tuning home climate through the mobile app.

Unpredictable season variations

The temperature for the season may differ from year to year. Savings on warmer winter might not be that high when comparing to different year when the winter was very cold.

Smart thermostat might not be able to save you constantly when your area has unpredictable season changes.

Climate of your area

If you live in the area where your climate is mild then your savings with smart thermostat might not be that significant. For example, if you don’t need to use air conditioning during the summer and it is not so cold during the winter then you will not be able to benefit much by having smart thermostat. The more you need to run heating or cooling the more benefit will come from installing a smart thermostat.

You could still benefit in case you would like to have more control over your home climate. Having smart thermostat would allow you to check home temperature and adjust it from pretty much anywhere.

Size and other characteristics of your home

The more energy you need to use to heat or cool your home the more you could benefit from having smart thermostat. Energy consumption obviously will depend on the size of your home – the bigger the more energy you need to use.

How good is your home insulation also matters. The better home on conserving the energy the less you need to heat and cool. It means less savings from smart thermostats. If your home is not well insulated you shall consider either improving it or getting smart thermostat.

Utilities cost

The higher utility cost in your area the more you pay for heating and cooling. If the energy cost is high at your area you can benefit from upgrading to smart thermostat. The higher the cost – the faster payback period for smart thermostat will be.

Thermostat cost (rebate)

Some of the utility companies (e.g. conEdison or Ameren Illinois) might compensate you full or some cost of the smart thermostat.

Check if your utility company does offer any of those rebates for getting smart thermostat. Sometimes they offer not only for thermostats, but changing to LED bulbs for example.

For example Nest offers number of ways how to save by upgrading to smart thermostat (or other smart home technology).

Type of technology

Depending on how “smart” the thermostat is highly depends on how much it can save you. Thermostats with internal sensors, external room sensors and learning abilities will likely much more follow your preferred home climate pattern at the same time saving you on energy bills. At the same time those might be the most expensive and therefore pay back period might be longer for such devices.

On the other hand, you should not discount the basic smart thermostats allowing you to track and program temperature remotely. Very often those thermostats will have smart home and away function to track your smartphone location and offer you comfortable temperature at the right time while saving when house is empty.

Can you save money if you have a heat pump, boiler or radiant heat?

Saving with heat pump

Heat pumps take more time to heat or cool than conventional heating systems. They were previously not recommended for programmable thermostats. To prevent such problems they are installed with auxiliary resistance heater that is used in extreme weather conditions when heat pump cannot keep up.

Auxiliary heating is much less efficient than heat pump and it is best to avoid using it whenever possible. Using programmable thermostat with such a system would result in triggering that inefficient auxiliary heating unnecessary and result in costing even more money than you can save.

New versions of smart thermostats like as ecobee or Nest can avoid such problem. These thermostats can calculate how much time it takes to reach the desired temperature and therefore start heating or cooling up to few hours early. This way the house will be up to the temperature you set at the right time without breaking the bank.

Saving with boiler or radiant heat

The main problem with the boiler or radiant heat is that it will continue heating the area for some period of time even after turning it off. It will also take quite some time to heat the space when it is turned on after it drops below certain temperature point.

This will cause an amplitude of constantly switching from too hot to too cold. It is otherwise called an “overshooting”.

Smart thermostats can reduce this problem by turning on boiler on or off in advance before reaching too hot or too cold state. Nest calls this feature True Radiant. Similar functionality has ecobee thermostats (without the name for the feature).

Tips for Saving Money with a Smart Thermostat

There are four primary ways preventing energy savings with smart thermostats:

  • Trying to work too quickly. Your home won’t get down to 77°F any faster if you have it set to 69° instead of 77° since your unit only works at a single speed. Allow your smart thermostat to switch the system off for most of the time, then start heating or cooling your system around 10 minutes before you get back home.
  • Changing settings too often. If you’re micromanaging your thermostat, then you might be forcing your HVAC system to turn and off far too much. Letting them run for a long steady time and then shut off for a long period of time will be more efficient. This is the default way that Nest, Honeywell and ecobee smart equipment manages HVAC systems.
  • Not giving the thermostat authority. This is every bit as bad as using a regular thermostat and leaving it at the same setting all of the time. Allow your smart thermostat to make changes to your schedule. You can always adjust them later if you don’t care for them.
  • Forgetting about your usage patterns. You own usage patterns can waste energy. If you’re setting your thermostat upwards of 89°F in the winter and 61°F in the summer, then there’s no way that a smart thermostat can save power. These settings are common in some areas, but they’re outside of what’s considered ideal.

Learning thermostats, regardless of who makes them, use motion sensors to detect when you’re there. Don’t be afraid of them turning off the HVAC system when you’re not around.

You’ll eventually get to a point where you can leave them alone since they’ll automatically choose the most efficient settings possible.

Most people can’t perceive a temperature shift of only a few degrees, so you might find that your new thermostat uses this fact to save a little money as well.

You could do this manually as well. If you prefer heating the house up to 70°F, then try a few days worth of 68° and see what happens. You might not even be able to notice the difference, especially if you’re dressed appropriately for the weather.

Is it worth getting smart thermostat?

Consumers who are already using a programmable thermostat shouldn’t need to upgrade to a smart thermostat if they’re using it correctly.

You can achieve many of the same benefits with a traditional programmable unit, especially if you make sure to dial the temperature up or down while you’re asleep or not home.

However, the different story would be for homes with conventional (non-programmable) thermostats. An average home can save quite significant amount of money when upgrading to the smart thermostat. For example, the Nest learning thermostat will pay for itself halfway through the second year.

Likewise, those who don’t like to use their furnace or AC unit very much won’t see any real benefit. However, these units should pay for themselves fairly quickly in most other use cases.

Users in extreme climates or those with particularly inefficient HVAC systems will stand to see the biggest savings. If you don’t mind doing the upgrade yourself, then you can stand to save even more money.

This doesn’t mean you have to be technologically inclined at all, because all it takes to install a smart thermostat is screwing in a handful of wires.

Consumers who cut out the middleman like this start saving right away since they don’t have to pay an installer’s fee. If you’re the kind of person who needs to have the house a specific temperature, then you might see a really drastic reduction on your bill when using a smart thermostat.

Depending on your situation, you could save upwards of $400 annually so these savings could theoretically pay for the unit in just a few months.

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