Revision Submittal Date:
To:

11‐25‐12

CEE300 Instructor & TA, Dr. Thomas Seager & Andrew Berardy

Dear Dr. Seager and Andrew,
Attached to this letter, is a revised version of our first Tech Report entitled Energy Star vs.
Conventional Refrigerators. We have received a grade of 96 on our initial submission and would like to
raise that grade to a 100. Additionally, we are aiming to better format the report in a fashion fit for
publication in the ASU Digital Repository.
All of Dr. Seager's suggested wording has been accepted and all other revisions were tailored to
address almost all comments you have both made on the report (explained in the table below). Lastly, a
combined Net Present Value graph was added to the recommendation section as an easy‐to‐read visual
aid for our readers.

ENERGY STAR vs.
CONVENTIONAL
APPLIANCES

Our team is grateful for the opportunity to improve our grades and are honored at the chance to
be published in the ASU digital repository. We hope you accept our revisions, but are willing to make
further changes if you feel it is necessary.
Thanks again,

John Barfoot, Travis Cheshire, Helene Florento, Zach Harbin, and Taylor Jensen

Technology Comparison &
Cost Analysis
Travis Cheshire
John Barfoot
Helene Florento
CEE 300‐ Engineering
Business Practices
Arizona State University
Dr. Thomas Seager
10/11/2012

Zachary Harbin
Taylor Jensen

ENERGY STAR vs. CONVENTIONAL APPLIANCES

ENERGY STAR vs. Conventional Appliances (Refrigerators)
EXECUTIVE SUMMARY
Historically, advances in technology have made it possible for modern consumers to perform
daily tasks more rapidly and efficiently. In the present technological age, innovation extends to
energy conservation. As a typical consumer may be well aware, such innovation often means
higher prices. However, in the case of appliances which run on minimal energy, advertisements
claim that higher purchase prices will be justified by long‐term monetary savings resulting from
lower energy bills. This report investigates the veracity of this claim. Generally, the findings in
this report are that it depends.
The ENERGY STAR program pioneered by the United State Environmental Protection Agency is a
voluntary green‐labeling program that helps consumers identify energy‐saving appliances.
Nevertheless, ENERGY STAR does not indicate to consumers whether a higher purchase price
for the efficient appliance will be justified by subsequent energy savings.
There are several variables which may justify spending more for energy conserving appliances.
It seems uncommon practice for a consumer to thoroughly evaluate factors which affect their
purchase, making it possible to spend more money despite the mindset of saving money. The
goal of this report is to identify and evaluate the variables, or varying scenarios, that potentially
sway the smart purchase decision in the case of ENERGY STAR refrigerators. Thus, the decision
can be tailored to a specific type of individual or household.
The ideal refrigerator for any given consumer depends on the habits and preferences of that
consumer including: time value of money preferences, food storage habits, and energy prices.
A cash flow diagram is a tool used to depict the monetary gains and losses involved in an
investment and will be a practical means to showcase both the initial costs and long‐term
maintenance costs for either type of refrigerator as influenced by each of the three criteria
introduced. This report will use cash flow diagrams to investigative the sensitivity of a
refrigerator purchase option to these three parameters. Graphs are also included which will
take the costs shown in the cash flow diagrams and display how many years it will take for the
higher initial purchase price of the ENERGY STAR refrigerator to be justified by its lower
maintenance costs, called the break‐even point. The analysis also involves calculating the net
present value, a term used largely in business, for both an ENERGY STAR appliance and a
conventional appliance; and involves calculating this net present value, also, as influenced by
the different circumstances mentioned.

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

2

ENERGY STAR vs. CONVENTIONAL APPLIANCES

TABLE OF CONTENTS
I. INTRODUCTION ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 4
‐ Background information on ENERGY STAR
‐ Statistics on the Energy Consumption of Refrigerators

II. INVESTIGATIVE METHOD ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 4,5
‐ Introduction to the concept of Present Value

III. RESEARCH & CALCULATION ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 6 ‐ 13
‐ The Time Preference Variable
(a) Cash Flow diagrams ‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐6
(b) Cost vs. Time table and graph ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐7
(c) Annual rate, Effective Rate, and Present Value comparison ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐7‐9
as a 7 & 14 year projection, including sample calculations

‐ The Food storage Habit Variable
(a) Cash Flow diagrams ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐10
(b) Cost vs. Time table and graph ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 11
(c) Annual rate, Effective Rate, and Present Value comparison ‐‐‐‐‐‐‐‐‐‐‐‐‐ 11,12
7 year projection

‐ The Energy Cost Variable
(a) Cash Flow chart & diagram ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 13,14
(b) Cost vs. Time table and graph ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐15
(c) Annual rate, Effective Rate, and Present Value comparison ‐‐‐‐‐‐‐‐‐‐‐‐ 16,17
7 year projection

IV. FINAL RECOMMENDATIONS ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 18,19
V. REFERENCES ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 20
VI. APPENDIX A ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 21
ENERGY STAR suggestions for saving energy and lowering cost with your refrigerator.

VI. APPENDIX B ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 22‐25
Tables for each corresponding Cash Flow Diagram & Graph.

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

3

ENERGY STAR vs. CONVENTIONAL APPLIANCES

INTRODUCTION
The ENERGY STAR Program was created in 1992 by the US Environmental Protection Agency (EPA) to
stimulate the development and sale of energy‐efficient goods in hopes of minimizing greenhouse gas
emissions. In addition to reducing greenhouse gas emissions, the program strives to provide the
consumer with products that meet and/or exceed their conventional counterparts in terms of
performance and standards of comfort. [1] ENERGY STAR appliances are rated on a 1 to 100 scale, 50
being an average rating. Typically, a rating of 75 or higher indicates a high performance appliance in
terms of meeting a string of energy standards set by the U.S. government. [2]
Owning an appliance rated 50 or higher by ENERGY STAR may seem most useful when considering those
household devices at the top of the list for energy consumption. According to the Energy Information
Administration in 2001, conventional refrigerators consume the highest percentage of electricity, and
thus energy, in comparison to other household appliances. Specifically, refrigerators are responsible for
approximately 14% of electricity usage by appliances followed by lighting at about 9%. [3] ENERGY
STAR refrigerators, a proposed solution to soaring energy consumption, utilize new technologies that
provide better insulation, higher efficiency compressors, more accurate temperature control measures
and better defrost mechanisms to reduce that energy usage by upwards of 50 percent.

INVESTIGATIVE METHOD
A comparison between an ENERGY STAR appliance and a conventional appliance with similar dimensions
and functionality provides a baseline investigative method for a comparative net present value analysis.
Two of Kenmore's popular refrigerator models, conventional model #68882 (sold at Sear's), and ENERGY
STAR model #68892 are both 18 cubic feet, meeting the capacity needs of most households, and are
both top‐freezer refrigerators. The price for Kenmore's conventional model is approximately $80.00
cheaper than the ENERGY STAR model at market price $619.99 vs. $699.00. The choice between these
specific two models allows us to highlight the effects of time preference, food storage habits, and
energy costs on the analysis results, without having to consider other elements that are likely to be the
same in each case, such as repair cost.
A first variable to consider when deciding to purchase an Energy Star or conventional refrigerator is a
consumer's time preference. Time preference refers to the concept that each individual varies from
another in the amount of time they are willing to wait before he or she enjoys or consumes the benefit
of an investment. The theory is that a person with patience (low discount rate, or weak preference for
the present compared with future benefits) is willing to wait longer for a return of their initial
investment. [4] This greatly influences the buyer's decision on an ENERGY STAR vs. conventional
refrigerator. A college student on a budget, an example of high discount rate, likely prefers present
savings over future savings. They may be in the market for an inexpensive refrigerator knowing that in

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

4

ENERGY STAR vs. CONVENTIONAL APPLIANCES

less than 4 years, he or she will be a successful graduate and can buy the tech savvy stainless steel
refrigerator of his or her dreams. The issue here is that in the current year, the student has no
significant income and is looking to spend the least amount of cash as immediately possible. The
analysis for the time preference variable will evaluate the initial difference in purchase cost and the
yearly operating costs to determine if and when the ENERGY STAR refrigerator begins to save the
consumer money (i.e. break‐ even point) on their energy consumption expenditures. In the case that
the break ‐ even point ends up being later than a person's time preference period, perhaps an ENERGY
STAR appliance is not the correct recommendation.
The second factor to be examined in this analysis is food storage habits. For owners with conventional
refrigerators, storing less food actually increases the appliance's energy consumption due to the fact
that the larger space causes the cooling system, which maintains the desired temperature, to stay on
longer. [5] According to a study conducted by the National Institute of Standards and Technology,
keeping a refrigerator at least 75% empty can raise monthly energy costs by about 20% [11]. ENERGY
STAR appliances, as mentioned, have the insulation technology to counter‐act the constant running of
the cooling apparatus, whether or not the refrigerator is stocked or empty. The cost analysis for food
storage habits, then, will involve using the increased price of running an empty conventional refrigerator
in place of the average yearly operating costs previously used. The team's recommendation will be
based on whether or not the outcome break‐even point is close enough to the initial purchase time.
Along with variables focused on the consumer, are economic market based variables. The price of
energy, for one, fluctuates with its supply and demand in the world market. The current 2012 price in
the Phoenix Metro Area is $0.095 per kilo‐Watt‐hour (kWh) [6] and is an approximate increase of 1.7%
from 2011 prices. [7] The team's analysis, similar to the previous two, will include initial purchase cost
and yearly operating costs of an ENERGY STAR vs. conventional refrigerator, but with energy costs at
1.7% higher, and at energy costs 1.7% lower
Perhaps the most important tool which will be utilized in the following section of the report is Net
Present Value (see Equations 1, 2, & 3 below) which indicates the future value of either refrigerator
model in terms of "today's money." The annual discount rate will be plotted against this Net Present
Value in order to illustrate which of the options is the best choice for any of the three
variables/scenarios just discussed. Microsoft Excel® computes the net present value with an embedded
formula, shown below. However, net present value calculations may also be performed manually as
shown throughout the next section (pages 8 and 9).
(1)
Where A = the amount of each recurring payment, i = the discount rate, and N = the total number of payments.

(2)
Where F = the cash flow per period, r = the rate of return, and N = the number of periods.

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

5

ENERGY STAR vs. CONVENTIONAL APPLIANCES

∑

(3)

RESULTS & CALCULATION
Time Preference Variable
Figure 1 & 2 are the cash flow diagrams reflecting initial prices (excluding sales tax) and the first year
energy cost of each refrigerator model in year 1, followed by the operating costs per year of each. As
the diagrams show, the initial cost of the ENERGY STAR appliance is higher, but requires a lower
maintenance amount per year throughout the 14 year projection. The estimated yearly operating cost
for a conventional refrigerator is $45.51 [8] and the operating cost for an ENERGY STAR Refrigerator is
approximately $36.39; both utilizing the $0.095 per kWh energy cost. [9]

Cash Flow (Conventional)

Cash Flow (Energy Star)

0

0

‐100

‐100

‐200

‐200

‐300

‐300

Dollars

Dollars

‐400
‐500

‐400
‐500

‐600

‐600

‐700

‐700

‐800

‐800
1 2 3 4 5 6 7 8 9 10 11 12 13 14

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Years

Years

FIGURE 1 – Refer to Table 1 in Appendix B for

FIGURE 2 – Refer to Table 2 in Appendix B for

plotted data

plotted data

October 11, 2012

6

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

ENERGY STAR vs. CONVENTIONAL APPLIANCES

Assuming that the typical life span of a refrigerator is 8 ‐ 14 years without major repair [10], Figure 3
above shows the linearly compounded cost of both the ENERGY STAR and conventional refrigerator over
a course of 14 years. The break ‐ even point is estimated to be around 8.7 years (without discounting to
present value). This gives us an overall view of costs over time. However, consumers are most likely
interested in how these costs over time might look in terms of money today. The Net Present Value
analysis to follow will show discounted costs.

$0
($200)
Cost (dollars)

($400)
($600)
Energy Star

($800)

Conventional

($1,000)
($1,200)
($1,400)
1

2

3

4

5

6

7

8

9 10 11 12 13 14

Years

FIGURE 3 – Refer to Table 3 in Appendix B for plotted data

October 11, 2012

7

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

ENERGY STAR vs. CONVENTIONAL APPLIANCES

NET PRESENT VALUE vs. ANNUAL RATE

7 Year
Net Present Value

($700)
($750)
($800)
($850)
($900)

Energy Star

($950)

Conventional
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
5.5%
6.0%
6.5%
7.0%

($1,000)

Annual Discount Rate

14 Year
($900)
($950)
($1,000)
($1,050)
($1,100)
($1,150)
($1,200)
($1,250)
($1,300)

Energy Star
Conventional
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
5.5%
6.0%
6.5%
7.0%

Net Present Value

Annual Discount Rate

FIGURE 4,5 – Refer to Tables 4,5 in Appendix B for plotted data
Using annual discount rates of 0‐7%, the Net Present Value plot in Figure 4 (top graph) the conventional
refrigerator is always more cost efficient than the energy star refrigerator throughout the course of 7
years. The Effective discount rate shown in the 7 year projection table was calculated as follows:
1

1

(4)

Where r = the annual rate, and m = the # of compound periods, which was 12 in this case, compounding monthly.

SAMPLE CALCULATION:

TRAVIS CHESHIRE,

JOHN BARFOOT,

1

HELENE FLORENTO, ZACH HARBIN,

.

1

TAYLOR JENSEN

0.0253

October 11, 2012

8

ENERGY STAR vs. CONVENTIONAL APPLIANCES

Using similar methods of calculating effective discount rate, the 14 year projection of Net Present Value
shown in Figure 5 above is that the Energy Star refrigerator is actually more cost efficient, or, "cheaper
in terms of today's money." Until, that is, the effective rate of 7.2%.
The following sample calculations demonstrate the method used to produce Figures 4 and 5.

SAMPLE CALCULATION:

The following calculations utilize Equations (1), (2), and (3) from the Investigative Method Section of this
Report. The example chosen for display is the calculation of the ENERGY STAR APPLIANCE Net Present
Value over the 14 year projection.

36.39

1 0.07229
1
0.07229 1 0.07229
$313.92

0
**There is no one payment in the future that differs from the recurring payments of $36.39. The initial purchase cost is not to
be discounted as it is already at present value.

INITIAL PAYMENT

$699.99

∑

= ($313.92)+($0)+($699.00) = $1012.92

October 11, 2012

9

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

ENERGY STAR vs. CONVENTIONAL APPLIANCES

Food Storage Habits Variable
According to a study conducted by the National Institute of Standards and Technology, keeping a
refrigerator at least 75% empty can raise monthly energy costs by about 20% [11]. Figure 6 above is
similar to the cash flow diagrams in Figures 1 & 2, instead replacing the average yearly costs of a
conventional refrigerator with yearly operating costs at a 20% increase; assuming that the ENERGY STAR
technology is advanced enough to be immune to raising energy consumption via an empty fridge.

Cash Flow (Energy Star)

Cash Flow (Conventional)

0
‐100
‐200
‐300
‐400
‐500
‐600
‐700
‐800

Dollars

Dollars

0
‐100
‐200
‐300
‐400
‐500
‐600
‐700
‐800

1 2 3 4 5 6 7 8 9 10 11 12 13 14

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Years

Years

FIGURE 6 – Refer to Table 6 in Appendix B for plotted data
$0
($200)
($400)
Cost (dollars)

($600)
($800)

Energy Star

($1,000)

Conventional

($1,200)
($1,400)
($1,600)
1

2

3

4

5

6

7

8

9 10 11 12 13 14

Years

FIGURE 7 – Refer to Table7 in Appendix B for plotted data
With the 20% increase in costs to run a conventional refrigerator, the break ‐ even point occurs sooner
at approximately 4.5 years.

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

10

ENERGY STAR vs. CONVENTIONAL APPLIANCES

In contrast with Figure 4 in the Time Preference Variable Section, this 7 year projection (Figure 8) shows
ENERGY STAR being more cost‐efficient. The increased 20% yearly operating costs consequent of
leaving a refrigerator at least 75% empty is enough to change the recommendation to a consumer.
ENERGY STAR now becomes a more suitable purchase. The 14 year projection would also show ENERGY
STAR as more cost ‐efficient than a conventional refrigerator.

7 Year
$0
Net Present Value

($200)
($400)
($600)
Energy Star

($800)
($1,000)

Conventional

($1,200)
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%
Annual Discount Rate

FIGURE 8 – Refer to Table 8 in Appendix B for plotted data

Cost of Energy Variable
Shown in Figure 9 are the cash flow diagrams for the Energy Star(top) and conventional refrigerator
(bottom) using yearly operating costs when energy is priced at 9.7 cents per kWh versus the current 9.5
cents per kWh ( a 1.7% increase in energy costs). As shown, the initial purchase prices remain the same
and the yearly operating costs for the conventional refrigerator are still higher than those for the Energy
Star refrigerator. It is the overall costs per year (for both) that increase. In the following Net Present
Value analysis, we will see if these increased costs are significant or not.

October 11, 2012

11

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

ENERGY STAR vs. CONVENTIONAL APPLIANCES

0
‐100
‐200
‐300
‐400
‐500
‐600
‐700
‐800

Cash Flow (Conventional)

Dollars

Dollars

Cash Flow (Energy Star)

1

3

5

7

9

0
‐100
‐200
‐300
‐400
‐500
‐600
‐700
‐800

11 13

1

3

5

Years

7

9

11 13

Years

FIGURE 9 – Refer to Table 9 in Appendix B for plotted data
Figure 10 shows yearly operating costs which reflect the use of 9.3 cents per kWh versus the current 9.5
cents per kWh: a 1.7% decrease in energy costs. Again, we shall see with the Net Present Value analysis
to follow, whether or not (this time) a DECREASE in energy costs is significant.

Dollars

0
‐100
‐200
‐300
‐400
‐500
‐600
‐700
‐800

Cash Flow (Conventional)

1

3

5

7

9

11 13

0
‐100
‐200
‐300
‐400
‐500
‐600
‐700
‐800
1

3

Years

5

7

9

11 13

Years

FIGURE 10 – Refer to Table 10 in Appendix B for plotted data

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

Cash Flow (Energy Star)

Dollars

12

ENERGY STAR vs. CONVENTIONAL APPLIANCES

When considering Energy Costs that are 1.7% HIGHER than the current costs, changes the break ‐ even
point from 8.7 years (Figure 3), to about 8.2 years (Figure 11).
$0

Cost (dollars)

($200)
($400)
($600)
Energy Star

($800)

Conventional

($1,000)
($1,200)
($1,400)
1

2

3

4

5

6

7

8

9 10 11 12 13 14

Years

FIGURE 11 – Refer to Table 11 in Appendix B for plotted data
When considering Energy Costs that are 1.7% LOWER than the current costs, changes the break ‐ even
point from 8.7 years (Figure 3), to about 9.1 years (Figure 12).

$0
($200)
Cost (dollars)

($400)
($600)
Energy Star

($800)

Conventional

($1,000)
($1,200)
($1,400)
1

2

3

4

5

6

7

8

9 10 11 12 13 14

Years

FIGURE 12 – Refer to Table 12 in Appendix B for plotted data
A quarter year difference in break ‐ even point is not a very significant alteration to time preference
projections. Thus, the team recommendation for the Energy Cost Variable will depend on the Net
Present Value diagram. Please see next page.

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

13

ENERGY STAR vs. CONVENTIONAL APPLIANCES

NET PRESENT VALUE vs. ANNUAL RATE

$0
($200)
($400)
($600)
($800)
($1,000)
($1,200)
($1,400)

Energy Star
Conventional
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

Net Present Value

7 Year

Annual Discount Rate

FIGURE 13 – Refer to Table 13 in Appendix B for plotted data
When considering Energy Costs that are 1.7% HIGHER than the current costs, the 7 year projection once
again becomes favorable for the conventional refrigerator
model as it was in Figure 4.

7 Year
($700)
Net Present Value

($750)
($800)
($850)
($900)

Energy Star

($950)

Conventional

($1,000)

Annual Discount Rate

FIGURE 14 – Refer to Table 14 in Appendix B for plotted data
When considering Energy Costs that are 1.7% LOWER than the current costs, the 7 year projection once
again becomes favorable for the conventional refrigerator model as it was in Figure 4.

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

14

ENERGY STAR vs. CONVENTIONAL APPLIANCES

The 14 projection models were ALWAYS favorable for ENERGY STAR (refer to Appendix B for these). What
differed with each variable, were the 7 year projections. It seems from Figure 13 & 14, that considering
different costs of energy (at least at the 1.7% change rate) finds the conventional model more cost‐
efficient. The cost efficiency when energy costs are more expensive, seems to be more immediate than
if the energy costs were lower.

October 11, 2012

15

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

ENERGY STAR vs. CONVENTIONAL APPLIANCES

FINAL RECOMMENDATIONS
TIME PREFERENCE
Person with a low Discount Rate
(willing to wait)
Person with a high Discount Rate
CONVENTIONAL
Explanation: A person with a low discount rate would fare well to purchase an ENERGY STAR
appliance. After 14 years, with good care, the refrigerator's yearly energy savings would justify its initial
purchase cost making Net Present Value higher than the conventional model. A person with a high
discount rate, however, may not want to wait the full 14 years in order to benefit from his/her purchase.
In the example of the college student who is in the market for a budget friendly refrigerator needed for
only 4 or so years, the conventional refrigerator is the recommendation. The break ‐ even point, as
shown in Figure 3, occurs at approximately 8.7 years ‐ long after the future value projection of the
student.

FOOD STORAGE HABITS
(assuming consumer has a high Time Preference)
Person who keeps an average to
fully stocked fridge
CONVENTIONAL
Person who dines out often, keeping
Often keeping an empty fridge
(approx. 75% empty)
Explanation: A person with a high time preference and who keeps an averagely stocked refrigerator
will have average yearly operating costs of approximately $45.51. (using the current 9.5 cent per kWh
energy price). Even when considering the lower yearly operating costs of the ENERGY STAR refrigerator,
a 7 year projection of the Net Present Value will show the conventional model as being more cost
efficient.
A person who dines out often and, thus, often keeps an empty fridge, is more likely to
experience a 20% increase in energy consumption which will lead to a 20% increase in yearly operating
costs (still using the current 9.5 cent per kWh energy price). This increase in yearly operating costs
lowers the break ‐ even point in a cost vs. time analysis (Figure 7) to about 4 years as opposed to 8.7
years. This means that the initial purchasing price of the ENERGY STAR refrigerator is justified much
sooner when compared to the raised yearly operating costs of the conventional model. Furthermore,
when considering the 20% increase in energy consumption of the conventional model, the Net Present
Value of the ENERGY STAR model becomes higher, even in the 7 year projection. It is now more cost ‐
efficient not only in the long run, but in the "short run."

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

16

ENERGY STAR vs. CONVENTIONAL APPLIANCES

ENERGY COST CHANGE
1.7% increase in Energy Cost
See Time Preference Recommendation
1.7% decrease in Energy Cost
See Time Preference Recommendation
Explanation: It was found that a fluctuation in energy prices of 1.7% (which was the case moving from
2011 to 2012) incurred no significant differences from the cost benefit analysis using Time Preference as
the primary variable. The only changes were the actual yearly operating costs for both the ENERGY STAR
and conventional appliance; it is obvious that because both models are subject to the energy price
increase or decrease, their relation to one another remains linear. Similarly, a larger percent increase or
decrease (for example, in 10 years) would affect the comparison between the two models in the same
manner.
In a seven year projection, the conventional model is more cost efficient. The Net Present
Value graph shows a smaller slope when the prices are increased by 1.7% than when the prices are
decreased by 1.7%, but the recommendation still remains favorable for the conventional model as the
overall cost efficiency prices are lower throughout the projection.

Conclusively, it is the consumer's personal time preference and food storage habits which need
to be considered as purchase decision factors. When in the market for purchasing a large
appliance which is responsible for a major portion of the household energy consumption, it
becomes important to evaluate how often it will be used, the capacity to which it will be used,
and the time period it is intended to be kept.

October 11, 2012

17

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

ENERGY STAR vs. CONVENTIONAL APPLIANCES

REFERENCES

[1] Unknown Author. “History of Energy Star.” ENERGY STAR. Available:
http://www.energystar.gov/index.cfm?c=about.ab_history . [Accessed: September 20, 2012].
[2] Unknown Author. “Energy Performance Ratings.” Wikipedia ‐ The Free Encyclopedia. Available:
http://en.wikipedia.org/wiki/Energy_Star . [Accessed: September 20, 2012].
[3] Energy Information Administration, Office of Energy Markets and End Use. “End‐Use
Consumption of Electricity 2001.” EIA Residential. Available:
http://www.eia.gov/emeu/recs/recs2001/enduse2001/enduse2001.html . [Accessed: September 22,
2012].
[4] Engelhardt, Lucas. “Time Preference, Interest Rate, and Production.” YouTube. Available:
http://www.youtube.com/watch?v=g2OK5D_3TzM . [Accessed: September 22, 2012].
[5] Reichman, Trevor. “Getting Better Efficiency from your Empty Refrigerator.” TLC ‐ A Discovery
Company. Available: http://tlc.howstuffworks.com/home/empty‐refrigerator‐efficiency‐tips.htm .
[Accessed: October 5, 2012].
[6] Unknown Author. “Arizona Energy Facts.” Institute for Energy Research. Available:
http://www.instituteforenergyresearch.org/state‐regs/pdf/Arizona.pdf . [Accessed: October 5, 2012].
[7] Unknown Author. “Consumer Price Index ‐ Phoenix ‐ First Half 2012.” Bureau of Labor Statistics.
Available: http://www.bls.gov/ro9/cpiphoe.pdf . [Accessed: October 5, 2012].
[8] http://www.kenmore.com/kenmore‐18.2‐cu‐ft‐top‐freezer‐refrigerator/p‐
04668882000P?keyword=68882&prdNo=1&blockNo=1&blockType=L1. [Accessed: September 23,
2012].
[9] http://www.kenmore.com/kenmore‐18.2‐cu‐ft‐top‐freezer‐refrigerator/p‐
04668892000P?vName=Kitchen&cName=Refrigerators+%26+Freezers&sName=Top+freezer+Refrigerato
rs&prdNo=2&blockNo=2&blockType=L2. [Accessed: September 23, 2012].
[10] Unknown Author. "Typical Lifespan of Major Appliances." The Virtual Repair Man. Available:
http://repair2000.com/lifespan.html. [Accessed: September 23, 2012].
[11] Grimes, Mulroy, Shomaker. "Effect of Usage Conditions on Household Refrigerator‐Freezer and
Freezer Energy Consumption." National Institute of Standards and Technology. Available:
http://fire.nist.gov/bfrlpubs/build77/PDF/b77002.pdf. [Accessed: October 6, 2012].

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

18

ENERGY STAR vs. CONVENTIONAL APPLIANCES

APPENDIX A
THE FOLLOWING TIPS WERE SUGGESTED BY THE AMERICAN COUNCIL for an ENERGY EFFICIENT ECONOMY at the
website: http://www.aceee.org/consumer/refrigeration

To find the most efficient refrigerators , download a qualifying product list from the ENERGY
STAR Web site. Sort by "Configuration," "Volume," and "Percent Better" to see which
refrigerators meet our recommendations (below). For a quick search by manufacturer, here's a
direct link to the list in html.
When buying a new refrigerator, consider the following:
1. Low Annual Energy Use: ACEEE recommends that you consider models that use at least
20% less electricity than that required by federal law. Models that are 20%, 25% and 30% better
than the federal standard may qualify for rebates — check with your local utility.
2. Choose top‐mounted freezer configuration over side‐by‐side: Side‐by‐side
refrigerator/freezers use more energy than similarly sized models with the freezer on top, even
if they both carry the ENERGY STAR. The government holds the two categories to different
standards, allowing side‐by‐sides to use 10‐30% more energy. Icemakers and through‐the‐door
ice also add to energy consumption. To compare energy performance across different
refrigerator types, look for the measured "kWh/year" either on the ENERGY STAR list above, or
on the yellow EnergyGuide label posted on the refrigerator (and available on‐line through many
manufacturers and retailers websites).
3. Size Matters: Refrigerators under 25 cubic feet should meet the needs of most households.
The models over 25 cubic feet use significantly more energy. If you are thinking about
purchasing such a large unit, you may want to reconsider. A smaller unit may well meet your
household's needs.
4. Minimize multiple refrigerators: That said, if you need more refrigerator space, resist the
temptation of moving your old refrigerator to the basement or garage for auxiliary purposes.
Instead, have it recycled and think about other options if you need more refrigerator space.
Depending on your situation, it is generally much more efficient to operate one big refrigerator
rather than two smaller ones. If your big fridge is likely to be empty most of the year, maybe
the better option would be to purchase an ENERGY STAR compact fridge. Compact refrigerators
less than 7.75 ft3 must be 20% more efficient than the minimum federal standard to qualify for
ENERGY STAR. They are listed alongside full‐size refrigerators at the ENERGY STAR link above.
5. Recycle your old fridge: Be sure you dispose of your old refrigerator properly. You can
usually have the utility or the city pick it up; they might even pay you to throw it out.

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

19

ENERGY STAR vs. CONVENTIONAL APPLIANCES

APPENDIX B
Table 1

Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

Table 2

Conventional
refrigerator
‐665.50
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51
‐45.51

Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

Table 3

ENERGY STAR
Refrigerator
‐736.38
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39

Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

Table 4

Annual
Rate
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

JOHN BARFOOT,

ENERGY STAR
Refrigerator
(736.38)
(772.76)
(809.15)
(845.53)
(881.92)
(918.30)
(954.69)
(991.07)
(1027.46)
(1063.84)
(1100.23)
(1136.61)
(1173.00)
(1209.38)

Table 5

14 YEAR PROJECTION
NPV
NPV
Effective Conventional ENERGY STAR
Rate
refrigerator
Refrigerator
0.00%
($1,257.13)
($1,209.45)
0.50%
($1,227.66)
($1,184.86)
1.00%
($1,199.54)
($1,161.37)
1.51%
($1,172.70)
($1,138.90)
2.02%
($1,147.08)
($1,117.41)
2.53%
($1,122.59)
($1,096.84)
3.04%
($1,099.19)
($1,077.13)
3.56%
($1,076.80)
($1,058.24)
4.07%
($1,055.38)
($1,040.13)
4.59%
($1,034.86)
($1,022.75)
5.12%
($1,015.21)
($1,006.07)
5.64%
($996.37)
($990.04)
6.17%
($978.30)
($974.63)
6.70%
($960.97)
($959.82)
7.23%
($944.32)
($945.56)

TRAVIS CHESHIRE,

Conventional
refrigerator
(665.50)
(711.00)
(756.51)
(802.01)
(847.52)
(893.02)
(938.53)
(984.03)
(1029.54)
(1075.04)
(1120.55)
(1166.05)
(1211.56)
(1257.06)

Annual
Rate
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

7 YEAR PROJECTION
NPV
NPV
Effective Conventional ENERGY STAR
Rate
refrigerator
Refrigerator
0.00%
($938.56)
($954.72)
0.50%
($927.62)
($944.95)
1.00%
($916.92)
($935.39)
1.51%
($906.46)
($926.02)
2.02%
($896.23)
($916.83)
2.53%
($886.22)
($907.83)
3.04%
($876.43)
($899.01)
3.56%
($866.84)
($890.36)
4.07%
($857.46)
($881.88)
4.59%
($848.28)
($873.56)
5.12%
($839.28)
($865.40)
5.64%
($830.47)
($857.39)
6.17%
($821.85)
($849.53)
6.70%
($813.39)
($841.82)
7.23%
($805.11)
($834.24)

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

20

ENERGY STAR vs. CONVENTIONAL APPLIANCES

Table 6

Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

Conventional
refrigerator
‐665.50
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61
‐54.61

Table 7

ENERGY STAR
Refrigerator
‐736.38
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39
‐36.39

Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

Table 8

Annual
Rate
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

Conventional
refrigerator
(674.60)
(729.20)
(783.81)
(838.41)
(893.02)
(947.63)
(1002.23)
(1056.84)
(1111.44)
(1166.05)
(1220.66)
(1275.26)
(1329.87)
(1384.47)

ENERGY STAR
Refrigerator
(736.38)
(772.76)
(809.15)
(845.53)
(881.92)
(918.30)
(954.69)
(991.07)
(1027.46)
(1063.84)
(1100.23)
(1136.61)
(1173.00)
(1209.38)

Table 9

7 YEAR PROJECTION
NPV
NPV
Effective Conventional ENERGY STAR
Rate
refrigerator
Refrigerator
0.00%
($1,002.26)
($954.72)
0.50%
($989.75)
($944.95)
1.00%
($977.53)
($935.39)
1.51%
($965.59)
($926.02)
2.02%
($953.92)
($916.83)
2.53%
($942.52)
($907.83)
3.04%
($931.36)
($899.01)
3.56%
($920.46)
($890.36)
4.07%
($909.80)
($881.88)
4.59%
($899.37)
($873.56)
5.12%
($889.17)
($865.40)
5.64%
($879.18)
($857.39)
6.17%
($869.41)
($849.53)
6.70%
($859.85)
($841.82)
7.23%
($850.48)
($834.24)

1.7% higher Energy Cost
Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

Conventional
refrigerator
‐666.45
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46
‐46.46

ENERGY STAR
Refrigerator
‐737.14
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15
‐37.15

October 11, 2012

21

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

ENERGY STAR vs. CONVENTIONAL APPLIANCES

Table 10

Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

Table 11

1.7% higher Energy Cost
Conventional ENERGY STAR
refrigerator
Refrigerator
(666.45)
(737.14)
(712.92)
(774.29)
(759.38)
(811.44)
(805.84)
(848.59)
(852.31)
(885.75)
(898.77)
(922.90)
(945.23)
(960.05)
(991.69)
(997.20)
(1038.16)
(1034.35)
(1084.62)
(1071.50)
(1131.08)
(1108.65)
(1177.55)
(1145.80)
(1224.01)
(1182.95)
(1270.47)
(1220.10)

1.7% higher Energy Cost
Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

Table 12

Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14

ENERGY STAR
Refrigerator
‐735.61
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62
‐35.62

Table 13

1.7% lower Energy Cost
Conventional ENERGY STAR
refrigerator
Refrigerator
(664.54)
(735.61)
(709.08)
(771.23)
(753.63)
(806.85)
(798.18)
(842.47)
(842.73)
(878.09)
(887.27)
(913.70)
(931.82)
(949.32)
(976.37)
(984.94)
(1020.91)
(1020.56)
(1065.46)
(1056.18)
(1110.01)
(1091.80)
(1154.55)
(1127.42)
(1199.10)
(1163.04)
(1243.65)
(1198.66)

TRAVIS CHESHIRE,

Conventional
refrigerator
‐664.54
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55
‐44.55

JOHN BARFOOT,

Annual
Rate
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

7 YEAR PROJECTION
(1.7% higher Energy Costs)
NPV
NPV
Effective Conventional ENERGY STAR
Rate
refrigerator
Refrigerator
0.00%
($945.21)
($1,270.43)
0.50%
($934.11)
($1,240.41)
1.00%
($923.25)
($1,211.77)
1.51%
($912.64)
($1,184.44)
2.02%
($902.25)
($1,158.34)
2.53%
($892.10)
($1,133.40)
3.04%
($882.16)
($1,109.57)
3.56%
($872.44)
($1,086.78)
4.07%
($862.93)
($1,064.97)
4.59%
($853.61)
($1,044.09)
5.12%
($844.49)
($1,024.09)
5.64%
($835.56)
($1,004.92)
6.17%
($826.81)
($986.54)
6.70%
($818.24)
($968.90)
7.23%
($809.85)
($951.96)

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

October 11, 2012

22

ENERGY STAR vs. CONVENTIONAL APPLIANCES

Table 14

Annual
Rate
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

Table 15

7 YEAR PROJECTION
(1.7% lower Energy Costs)
NPV
NPV
Effective Conventional ENERGY STAR
Rate
refrigerator
Refrigerator
0.00%
($938.14)
($949.33)
0.50%
($927.21)
($939.70)
1.00%
($916.52)
($930.26)
1.51%
($906.07)
($921.01)
2.02%
($895.85)
($911.95)
2.53%
($885.85)
($903.07)
3.04%
($876.07)
($894.36)
3.56%
($866.49)
($885.82)
4.07%
($857.12)
($877.45)
4.59%
($847.94)
($869.24)
5.12%
($838.95)
($861.18)
5.64%
($830.15)
($853.27)
6.17%
($821.53)
($845.51)
6.70%
($813.09)
($837.89)
7.23%
($804.81)
($830.40)

Annual
Rate
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

14 YEAR PROJECTION
(1.7% higher Energy Costs)
NPV
NPV
Effective Conventional ENERGY STAR
Rate
refrigerator
Refrigerator
0.00%
($1,259.03)
($1,210.97)
0.50%
($1,229.48)
($1,186.32)
1.00%
($1,201.29)
($1,162.77)
1.51%
($1,174.39)
($1,140.25)
2.02%
($1,148.69)
($1,118.70)
2.53%
($1,124.15)
($1,098.08)
3.04%
($1,100.69)
($1,078.33)
3.56%
($1,078.25)
($1,059.40)
4.07%
($1,056.77)
($1,041.25)
4.59%
($1,036.21)
($1,023.83)
5.12%
($1,016.52)
($1,007.12)
5.64%
($997.64)
($991.06)
6.17%
($979.53)
($975.62)
6.70%
($962.16)
($960.77)
7.23%
($945.48)
($946.49)

14 Year
($900)
($950)
($1,000)
Net Present Value

($1,050)
($1,100)
Energy Star
($1,150)

Conventional

($1,200)

October 11, 2012

23

($1,250)
($1,300)

Annual Discount Rate

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN

ENERGY STAR vs. CONVENTIONAL APPLIANCES

Table 16

Annual
Rate
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
5.50%
6.00%
6.50%
7.00%

14 YEAR PROJECTION
(1.7% lower Energy Costs)
NPV
NPV
Effective Conventional ENERGY STAR
Rate
refrigerator
Refrigerator
0.00%
($1,255.21)
($1,207.91)
0.50%
($1,225.82)
($1,183.39)
1.00%
($1,197.77)
($1,159.95)
1.51%
($1,171.01)
($1,137.54)
2.02%
($1,145.44)
($1,116.10)
2.53%
($1,121.02)
($1,095.57)
3.04%
($1,097.67)
($1,075.91)
3.56%
($1,075.34)
($1,057.07)
4.07%
($1,053.96)
($1,039.00)
4.59%
($1,033.49)
($1,021.66)
5.12%
($1,013.89)
($1,005.01)
5.64%
($995.09)
($989.01)
6.17%
($977.06)
($973.64)
6.70%
($959.76)
($958.85)
7.23%
($943.15)
($944.62)

14 Year
($900)
($950)
($1,000)
Net Present Value

($1,050)
($1,100)
Energy Star
($1,150)

Conventional

($1,200)

October 11, 2012

24

($1,250)
($1,300)

Annual Discount Rate

TRAVIS CHESHIRE,

JOHN BARFOOT,

HELENE FLORENTO, ZACH HARBIN,

TAYLOR JENSEN