How Much Will a Smart Thermostat Really Save on Energy Costs?

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No one enjoys shelling out money for heating bills in the winter or air conditioning in the summer, which is why smart thermostats, which claim to keep those energy bills down, continue to be one of the hottest household items around. But are they worth it?

According to a recent Coldwell Banker survey, 77% of home buyers crave one of these smart devices, even more than they covet smart locks or smart security cameras.

Buzz factor aside, though, a smart thermostat can cost upward of $300, including installation, so it’s worth taking a hard look at this pricey purchase to see how much you’ll really save.

How smart thermostats work

Smart thermostats enable homeowners to adjust the temperature in their house in a variety of ways that don’t entail fiddling with the thermostat. For one, you can adjust the temperature remotely with a smartphone app or other device—useful if you forgot to turn the heat off before a trip, or want to warm up your place before you return.

“Higher-end models may also contain smart tracking that can sense whether there are people in the house or if the air is getting warm and adjust the temperature accordingly,” says Josh McCormick, vice president of operations for Mr. Electric, an electrician network. “Other models have learning features that let it auto-program itself based on your habits.”

“Mostly, a smart thermostat is about maximizing convenience and comfort while minimizing your energy costs,” says Eric Blank, editor of The Smart Cave, a smart home product review site. “You could probably save nearly as much with a much cheaper thermostat, but it would require constant monitoring and adjustments. And, it might require sacrificing some comfort.”

Plus, a smart home thermometer is good for the environment. If everyone in the U.S. switched to an Energy Star–certified smart thermostat, 13 billion pounds of annual greenhouse gas emissions would be offset.

How much smart thermostats save in energy costs

There’s no hard and fast answer to this question.

One report found an average cost savings of $100 to $150 per homeowner each year. McCormick has seen annual savings as high as $180. Blank notes that manufacturers often advertise that you can save 15% to 25% on your heating and cooling bills. However, he points out, “they base their claims on someone who always leaves their home set to 72 [degrees Fahrenheit].”

If you already adjust your thermostat fairly regularly—turning down the heat at night when you’re sleeping, and when you’re at work—you may not save that much, Blank cautions.

“However, a smart thermostat will allow you to stop worrying about whether you set the heat back before you left,” he adds.

And peace of mind is priceless, right?

The amount you’ll save will also depend on the following:

• Where you live: “There’s always more savings to be found in extreme climates,” Blank notes.
• How you heat your home: For instance, if you use electric baseboard heat, a smart thermostat might be a huge money saver. “Since those homes are typically controlled in zones, large savings can be attained by leaving unused rooms minimally heated,” says Blank.
• What type of thermostat you currently use: “The oldest and cheapest analog versions use mercury, and the temperature readings are far from exact,” notes McCormick. Upgrade to a smart thermostat and you’ll notice a big difference.

Other info about smart thermostats

Saving the environment should be reason enough to get one of these thermostats, but keep these details in mind:

Setting up a smart thermostat can be a pain—or pricey. “Most manufacturers provide great installation instructions,” says Blank, “but initial setup can still be intimidating if you’re not a very handy person.”

Hiring someone to install it for you can cost $300 to $550, but McCormick points out that many energy companies offer deals.

Glitches will cost you time or money, or both. As with any smart product, glitches happen. In winter 2016, a software bug in Nest thermostats left many homeowners literally in the cold. Once it could be fixed, customers needed to go through a tedious nine-step process to reboot their device.

With smart thermostats, “there’s always the potential for a more complicated problem to arise,” Blank says. “If you end up having an expensive service call, any savings from using the smart thermostat could be spent in a hurry.”

They are a plus for home sellers. If you’re preparing to move and wondering if adding a smart thermostat will add to your home’s value, the answer is yes, says Paul Saperstein, a broker for eXp Realty in South Florida— but perhaps don’t stop there.

“Buyers are more excited about smart home thermostats when they see them as part of an overall smart home system, including smart lighting, window coverings, and entries,” Saperstein says. “Adding one or two additional smart devices maximizes the impact for buyers and the overall return on investment.”

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