Is Going Green Too Expensive for Most People?

I was watching an episode of the reality television show Greensburg on the Planet Green channel where they were talking to an old ex-Marine, who declared, All this green stuff is bull! Green construction is for rich people, he said; it's too expensive for average folks. Greensburg, Kan., is the town that was wiped out by an EF5 tornado in May 2007. We had the pleasure of visiting Greensburg in August

I was watching an episode of the reality television show Greensburg on the Planet Green channel where they were talking to an old ex-Marine, who declared, “All this green stuff is bull!” Green construction is for rich people, he said; it's too expensive for average folks.

Greensburg, Kan., is the town that was wiped out by an EF5 tornado in May 2007. We had the pleasure of visiting Greensburg in August and talking to town officials, homeowners and business owners about the town's goal of rebuilding itself as the greenest city in America (Greensburg Working to be Greenest Town in America).

Money is an issue in Greensburg not just for building green but rebuilding at all. Rebuilding from scratch will cost double or triple the value of the houses that once stood in Greensburg, so the payouts from homeowners' insurance cover only a fraction of the cost.

Then there are two news items that I've come across that bear conflicting information about whether green is for the rich or the rest of us.

Fireman's Fund Insurance Co., which launched the first green homeowners insurance in the U.S. this summer, has found that high-end homeowners favor “green” homes.

The survey revealed that affluent individuals are most interested in replacing heating, cooling and electricity systems, appliances, roofing and flooring with green materials. The same respondents had a high familiarity with water-conserving plumbing and automatic control systems.

On the other side of the debate, the Research Institute for Cooking & Kitchen Intelligence's (RICKI) latest research study, Remodelers 360, a survey of nearly 9,500 American consumers, examined kitchen remodeling experiences and attitudes.

“As we've found in our research over the years, price, design and other factors take priority over environmental issues,” according to Brenda Bryan, executive director of RICKI. But wait.

“When slicing and dicing the data, one finding that surprised me and may seem counterintuitive to some is that lower-income respondents are more likely than their wealthier counterparts to have considered the environmental impact of their purchases for their kitchen remodel,” says Bryan.

This is not a new issue. Contractors have been saying for years now that you can't get homeowners to replace their water heaters, furnaces or boilers, no matter how inefficient, if it means spending money to replace an appliance that's still working.

One of the best way to overcome this is the method described by CONTRACTOR plumbing columnist Dave Yates. In both his column in the last two issues (Getting Your Walk Away Money, Part 2) and in his seminar Shades of Green presented at the RPA's recent Radiant Expo, Dave explains how to sell to homeowners based on return on investment not payback.

Here's Dave's sales approach. His customer has an 81.4% efficient boiler with a domestic water coil. The oil company wants $450 a month for a “budget” figure plus $300 to lock in the rate. Dave proposes a properly sized boiler with outdoor reset and sealed combustion that heats domestic water on demand only. Even for $4,000 more, a 92% efficient boiler will save an extra $2,000 over five years, making it a better deal that putting the money into a 60-month certificate of deposit. If the homeowner has to borrow the money, the 30% fuel savings and the tax write-off of the home equity loan make the high-efficiency equipment a better deal.

Note that Dave is insisting on sealed combustion. Every 10 Btu of gas combustion requires a cubic foot of air, he notes, and heating that air adds up. Dave has the numbers for heating infiltration air for both gas and oil.

Dave notes that the initial jump of about four grand to install equipment with AFUEs in the mid-90% range sounds frightening - until he shows the homeowners the ROI numbers.

If the price of high efficiency equipment is scary, the price of fuel will be scarier. Yates notes the electricity deregulation is predicted to raise electric rates 81% in his home state of Pennsylvania. Natural gas? Up 11% this winter, according to the federal Energy Information Administration. LP gas? $3.50 per gallon. Back in Greensburg, Mayor Bob Dixson wants a community wind farm to protect residents from the price of deregulated electricity.

Instead of asking if can we afford green construction, the question may become can we afford not to?