Can smart thermostats really help save money on your energy bill?

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Are smart thermostats worth buying?
More consumers are turning to smart technology to make their home more efficient and leading the smart home revolution are smart thermostats. But do they really help save money? Nicole Bogart reports – Apr 29, 2016

Energy bills are often a sore point for many homeowners. Whether it’s the middle of a sweltering summer or the dead of winter, it seems our heating and cooling costs increase year after year.

But more Canadians are turning to smart home technology to make their homes more efficient and eco-friendly.

According to a recent study commissioned by Telus, one of the greatest perceived benefits of living in a “smarter” home includes saving money and being greener. Of those who currently own a smart home gadget, 36 per cent have invested in a smart thermostat.

READ MORE: Survey finds ‘thermostat wars’ an issue in Ontario homes

Just like regular old thermostats, smart thermostats are responsible for controlling your home’s heating and air conditioning. The difference is, smart thermostats can learn from your behaviours to automatically adjust the temperature in your home, allow you to adjust your settings remotely and show you energy consumption statistics in real time.

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But do smart thermostats really help save money on your energy bill?

The claims

Of course, smart thermostat manufacturers flaunt energy savings as a big selling point for their devices.

The Nest Learning Thermostat is perhaps one of the most talked about models on the market.

This particular model not only learns your schedule and helps to automatically adjust the temperature in your home throughout the day, it can adjust its settings depending on changes in the weather and learn specifics about your house and its energy consumption – whether it’s drafty or takes a while to warm up.

According to two independent studies and one internal study, the Google-owned company claims on average the Nest Learning Thermostat saved U.S. customers around 10 to 12 per cent on their heating bills and around 15 per cent on their cooling bills.

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READ MORE: 4 ways to make your home smarter

Canadian smart thermostat maker Ecobee also learns about your schedule to automatically adjust its settings. The Ecobee3 also uses remote sensors throughout your home to get the temperature right and uses geo-fencing to detect when you are leaving or returning home.

According to Ecobee’s research, customers in the U.S. saved an average of 23 per cent on their heating and cooling costs in 2013 – its most recent research.

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Nest and Honeywell have savings calculators on their websites that allow you to see how much you might be able to save with the thermostats, depending on where you live, the size of your home and what type of heating you use.

According to Nest’s calculator, a 500 to 1,000 square foot home in North York, Ont., that has air conditioning and gas heating could see a savings of $35 to $94 per year.

Honeywell’s calculator for a home in the same area estimated a savings of $88 per year, based on average cooling and heating usage.

However, Nest’s thermostat will cost you $329 and Honeywell’s choices range from about $229 to $299, depending on the model.

That means you might not see a return on investment for a few years.

A lot depends on how energy efficient you are now

Did you know that for every degree Celsius (1.8 F) you lower your thermostat at night or while you’re away – for a minimum of eight hours – you can save up to two per cent on your heating bill?

If you have a programmable thermostat already and you already follow this advice, you are likely seeing a savings on your energy bill. If so, you might not benefit from a smart thermostat as much as someone who doesn’t adjust their settings.

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Newsham stressed that research into the effectiveness of smart thermostats is still lacking and noted that the research that has been done does not include how people were adjusting their thermostats before getting the technology.

The Energy Star program – which rates consumer products based on their energy efficiency – does not currently rate smart thermostats on their efficiency.

However; according to a spokesperson from Natural Resources Canada, Energy Star is in the process of creating a new product category in order to rate the devices.

But – according to research from 2011 – nearly 90 per cent of people with programmable thermostats don’t program them properly or at all because of their frustrating user interfaces.

If that’s still true, installing a smart thermostat could come in handy for those who don’t know how or forget to pre-set their temperature settings.

“Smart technology is enabling automatic savings,” said Shuchi Roy, innovation director at Direct Energy. “Life happens – but you now have temperature control at your fingerprints, encouraging those savings.”

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Roy added that smart thermostats can also promote greener living and added savings by offering visual cues and daily goals that tell users they are reaching their energy saving goals. Think of it like a fitness tracker for your home – positive reinforcement does work.

Are there any government incentives for smart thermostats?

The federal government does not currently offer any incentives for homeowners who install a smart home thermostat.

However, Direct Energy does offer a Nest Learning Thermostat package to its customers in Alberta and British Columbia. The company will provide customers with a free Nest thermostat when they sign up for a three year “Comfort and Control Plan.”

Enbridge Gas will also provide customers with a $100 credit if they install a Nest Learning Thermostat between April 15, 2016 and December 31, 2016.

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