Gita Subramony for Zondits, July 1, 2015. Image credit: Jeff Perkins
A new study examines the cost-effectiveness of Michigan’s low-income Weatherization Assistance Program. The study concluded that the program in Michigan did help families reduce energy usage by 10%–20%, but that the program only saved $2,400 per household on average compared with costs of about $5000 per household on average. The study did not find much evidence of rebound effect, a theory that posits that energy efficient equipment might influence consumers to alter their behavior so that they actually use more energy.
So what is causing the Michigan Weatherization Assistance Program to be so cost-ineffective? Sometimes low-income programs are not designed with cost-effectiveness in mind, but rather are focused on providing other social goods, such as tenant comfort.
Another factor contributing the program’s cost-ineffectiveness could be related to flaws in the engineering analyses to predict energy savings. These studies sometimes don’t reflect what happens in real life or make concessions for the vagaries of human behavior.
Though programs like this one might not be cost-effective it does not mean that they should be abolished. Other weatherization programs might have better results. Additionally, it is important to have outcomes that are more difficult to quantify but that result in achieving social well-being goals. If anything, the study highlights the importance of field testing and program evaluation in order to improve the accuracy of engineering studies and increase program cost-effectiveness.