Wednesday, February 18, 2009

Energy Conservation

In the current economic situation people are looking for savings anywhere they can get them. Energy conservation is one area where you can generate significant savings for the long-term. Any business and homeowner can invest in energy conservation that will provide better returns than safe investments like a bank account. Obviously, scale plays a large role because if you have more to save on your return is magnified. For example, if you spent $5,000 on a conservation measure and it saved you $1,000 per year in operating costs you'll recover your money in 5 years. But that is payback, not return on investment. If it is a new HVAC unit that will last around 10 years your return is greater. When evaluating these projects you need to look beyond payback and look at the life of the project and the savings (returns) it will generate. This will make these projects look like better investments than a lot of places you can put your money these days. Finally, tax credits and grants will make the projects even more financially sound. That's putting your money to work.

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