Life-cycle cost analysis of major appliances

Abstract

The Department of Energy has proposed energy efficiency standards for eight types of appliances. One of the criteria used to establish these standards is the economic impact of the standard on the consumers of the regulated products. A life-cycle cost analysis was performed for 32 classes of these eight appliances in order to gain a measure of the economic impact of equipment purchases on the consumer. Simple payback times were also computed to indicate how much time is required for the consumer to recapture his or her initial added investment in a more efficient product. Using national average energy use for each appliance type, we found that the proposed 1986 standards are cost-effective with respect to the energy efficiency levels projected to occur in the absence of standards for all classes of products. Simple payback periods range from several months for refrigerators and freezers to a maximum of 5.3 years for split system central air conditioners. A regional life-cycle cost analysis indicated that the distribution of costs and benefits from the proposed national standards varies significantly among the different regions for air conditioners and furnaces. In the region with the least cooling load hours, simple payback times are quite lengthy for air conditioners, and in some cases exceed the appliance lifetime.