Since 1980, EnergyGuide labels—which report an appliance’s estimated annual operating cost, compare the energy use of similar products, and list its energy use—have appeared on major appliances sold in the United States. The program, administered by the Federal Trade Commission (FTC), requires manufacturers to affix the EnergyGuide label to products.
However, according to a March 2013 report—Overcoming Market Barriers and Using Market Forces to Advance Energy Efficiency by the American Council for an Energy Efficient Economy—the program has failed to keep pace with the ever-evolving marketplace. Few new products have been added since the program started requiring labels in 1980. Televisions were only added in 2010, while clothes dryers and ranges are among the products still excluded. The report calls for reforms to the program, and better coordination of appliance standards and labeling activities among the FTC, the U.S. Department of Energy, and the U.S. Environmental Protection Agency.
The EnergyGuide label provides the estimated annual energy cost of the product along with a continuum comparison graphic to show how the annual energy use compares to similar models. One problem is that the rate used to determine the average national electricity cost is updated on a five-year schedule and does not reflect current or local cost. Your local utility rate could vary greatly, making a product more or less affordable over time. For example, in 2012, electricity rates in the United States ranged from $0.06 to $0.38 per kWh. That, coupled with a long lead time (up to several months) required to produce and place EnergyGuide tags, means that the performance comparison shown on the yellow tag is likely outdated before products even hit the sales floor.
For the best comparisons of different products, focus on the products’ estimated kWh usage and ignore where they sit on the continuum graph, as the continuum of similar products on the market is constantly changing and likely changed by the time you read the tag. But, remember that this estimate is based on average usage assumptions—your actual energy consumption may vary depending on how often you use the product.
The Limitations of Energy Star
The Energy Star label is a useful starting point to help you focus in on energy-efficient products, but the label’s presence does not mean a product is the most efficient on the market. While officials at the U.S. Department of Energy and the U.S. Environmental Protection Agency, which jointly run Energy Star, have been working to improve standards, a 2010 audit found that the program is vulnerable to fraud and abuse due to self-reporting by manufacturers. The audit found that some consumer products lacking Energy Star approval consume less energy than some that carry the label, since not all companies seek Energy Star certification.