Are You Part of the 31% of Americans Planning to Invest in This Green Technology in 2014?

SolarCity (NASDAQ: SCTY  ) recently partnered on a nationwide poll of American homeowners to determine their thoughts on going green. The poll found that overall, 88% of respondents supported renewable energy. Even better, at least in terms of SolarCity's future business, was that 62% of respondents would be interested in adding solar to their homes. That represents a significant potential market for SolarCity, considering that there are 75 million owner-occupied housing units in the U.S., while just 500,000 solar systems have been installed nationwide.

Where the green dollars are being spent
That said, in the near term, most homeowners were planning smaller-scale clean-energy-related upgrades to their home over the next year. What was interesting was that the planned purchase that was most popular with homeowners was LED lightbulbs. Overall, 31% of respondents were planning to buy LED lightbulbs in the next year. Also popular were smart thermostats such as Google's (NASDAQ: GOOGL  ) Learning Thermostat, better insulated windows, hybrid cars, and a more efficient water heater.

Source: General Electric News Center.

One of the reasons many consumers will be making the switch to LEDs is that they don't really have much choice. The Energy Independence and Security Act of 2007 mandates that all 60 W and 40 W light bulbs sold this year must be 25% more efficient, which effectively bans the production of traditional incandescent bulbs. Since these sizes happen to be the most popular ones in America, many Americans will be replacing them with either CFLs or LEDs. While LEDs cost more, the energy savings are substantial, making it the bulb of choice for many Americans.

General Electric (NYSE: GE  ) has a great energy savings calculator that shows just how much money can be saved by switching. For example, by replacing just one 60 W bulb with a GE energy smart LED 11 W bulb, an average consumer would save $5.90 per year in energy costs. That puts the payback period at less than three years. Add the fact that one GE LED bulb lasts 25,000 hours, or the life span of 25 incandescent bulbs, and the return on investment is pretty compelling.

Photo: Google Learning Thermostat.

Two other great options
Each of the other green options that homeowners are considering has a varying degree of financial payoff. For example, the 11% of homeowners who are planning to purchase a smart thermostat such as Google's $249 Learning Thermostat will save hundreds of dollars each year on their utility bills. Using the Learning Thermostat as an example, on average homeowners installing the Google thermostat will save 20% on their utility bills each year, or an average of about $173 per year. That makes for a less than two-year payback period. For a consumer who either doesn't have a programmable thermostat yet or just hasn't programmed it, the Google Learning Thermostat is a great green investment. 

Another popular green option is an Energy Star-rated water heater, which 9% of those polled plan to have installed in their home this year. Given that the water heater is the second-largest energy expense for a homeowner, or 14%-18% of utility costs, consumers can gain substantial savings from this upgrade. In fact, homeowners can save anywhere from 7% on their utility bills to up to 50%, depending on which model is selected. In most cases, a homeowner can see a payback in just a few years by replacing the water heater.

Final thoughts
For a homeowner, going green can be a solid investment. An investment of a few hundred dollars will allow a homeowner to swap out incandescent lightbulbs with LED bulbs from a company like GE or buy a Google Learning Thermostat and earn a payback in as little as two years. Meanwhile, more intensive investments like a highly efficient water heater or even a solar system from SolarCity also have a pretty compelling return on investment. All told, it makes a lot of sense to invest in greener solutions, as it's better for our environment as well as for your wallet.

Invest your energy savings in this top stock
There's a huge difference between a good stock and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.



Read/Post Comments (1) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 17, 2014, at 11:58 AM, ronwiserinvestor wrote:

    Solar leases and PPAs are not investments. Purchasing a solar system at 1/3 the cost of a lease or PPA, now that's an investment.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2875976, ~/Articles/ArticleHandler.aspx, 11/26/2014 11:46:06 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 1 hour ago Sponsored by:
DOW 17,827.75 12.81 0.07%
S&P 500 2,072.83 5.80 0.28%
NASD 4,787.32 29.07 0.61%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

11/26/2014 4:00 PM
GE $26.87 Up +0.01 +0.04%
General Electric C… CAPS Rating: ****
GOOGL $547.73 Down -1.50 -0.27%
Google (A shares) CAPS Rating: ****
SCTY $56.46 Down -0.39 -0.69%
SolarCity CAPS Rating: ***

Advertisement