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Energy Costs Shrinking for Residential PropertiesContinuing a (perhaps surprising) trend from the last few years, energy usage per home has dropped again in 2013, to the lowest level since 2001. 

At an annual electricity usage rate of 10,819 kilowatt-hours per household, U.S. households have used less energy for each of the last three years, according to the Energy Information Administration.  This trend has occurred despite more widespread electronics usage nationwide. 

Residential homes have grown more energy efficient, due variously to increasingly stringent building regulations, dropping prices of energy-efficient upgrades and of course ever-improving devices that need less power to run.  Where building regulations have had an impact is in areas like insulation, where new homes are simply required to meet stricter standards that allow less leakage. 

But it is not only new homes that have improved.  Cheaper materials, such as double-paned insulated windows, have also enabled more homeowners and landlords to upgrade the efficiency of their existing homes affordably.

Individual appliances and electronics in most U.S. homes have also grown less demanding.  Power-hungry appliances, such as refrigerators, use far less electricity today than they did fifteen years ago.  Window air conditioning units, perhaps the most power-slurping device in residential properties, are being used less frequently, as more efficient (and popular) central air conditioning is found in more homes every year.  Even today’s mammoth televisions use less power than the bulky old cathode ray televisions of the 20th century – most LED televisions use less power in a year than a single incandescent light bulb. 

And we all know how much less power compact fluorescent and LED light bulbs use today, compared to those old incandescent bulbs (or maybe not – it’s 70-80% less).

Gadgets, such as phones, tablets and laptops use a tiny fraction of the power that old desktop computers do.  An iPad literally requires 1/20th of the electricity, in a given year, that a desktop computer does.  Because more of our devices are mobile, they are specifically designed to require as little power as possible to run, to extend battery life as a selling point.

Gadgets don't stop helping there either; many more homes have "smart" thermostats, which are either pre-programmed to save power or are controlled remotely through mobile apps.  As the "internet of things" becomes more of a reality, more parts of our homes are becoming either programmable or remote-accessible, which will allow for greater control and less energy usage. 

So where does the news turn sour?

As expected, Americans use many more electronic devices nowadays than they did in, say, 1995.  But that is not the greatest problem; after all, a poor family in Appalachia might not have been able to afford a window air conditioner in 1995 (and almost certainly could not afford a mobile phone), but perhaps today they can.  It is hard to overstate how much an improvement these technologies can have on families' quality of life.

If Americans want to get serious about using less electricity, there need to be better incentives for landlords to upgrade their rental properties to be more energy efficient.  Why would a landlord spend $1,500 on, say, upgrading the windows, when it is the tenant who pays the electricity bill?  The landlord sees no return on that investment. 

One option is legally requiring electricity bills to be paid by the landlord; the landlord raises the rent to cover the additional cost, and now has an incentive to maximize the efficiency of the unit, but the problem is that only part of energy efficiency is structural, the rest is based on usage.  In apartment buildings where utilities are included in the rent, tenants are twice as likely to leave lights on when they leave a room, more likely to crank up the heat in the winter and blast the air conditioning in the summer, etc.  So while regulators would love to implement this politically-easy policy, it would not actually reduce power usage.

U.S. Homes Become More Energy-EfficientA less politically attractive (but far more effective) option would be to offer generous tax credits to landlords who make energy efficient upgrades to their rental properties.  The tenants still watch their usage, because they are still paying for it, but they end up using less due to the structural upgrades. 

Another option is the gradual implementation of smart grids, that can do fun things like buy back surplus power from homes with solar panels, charge less for power used at off-peak hours, etc.  But this costs money, and with many U.S. cities already struggling to reduce bloated budgets, this is a tough sell.

Ultimately, the combination of lower energy usage and booming U.S. energy production through solar, wind, shale oil and clean natural gas means the U.S. is inching closer to energy independence (in October, the U.S. used less oil than it produced).  And a world in which the U.S. does not rely on unstable or antagonistic nations for its energy means a much safer world for America, and less money lining the pockets of dictators in the Middle East and would-be tsars in Russia.


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