New Air Conditioners Will be Pricey

Last updated on April 17th, 2022 at 06:14 am

Beginning in January, new federal regulations will require consumers to purchase central air conditioners that are more energy efficient. Consumers will be able to continue using air conditioners with seasonal energy efficiency rating (SEER) 10 standards in their homes, but after Jan. 1, they will be unable to purchase new models with efficiency ratings under SEER 13. SEER measures the cooling capacity of the appliance vs. the amount of energy it consumes.


Although consumers will save on energy bills, the installation and price of the SEER 13 models are more expensive than those for SEER 10 versions currently on the market. Additionally, consumers will have to replace the evaporator coil in their furnace to make their furnace compatible with the new air conditioner. If you need to replace your broken ac, you may need to research on energy-efficient ac units.


“Depending on the home and the installation, (the SEER 13) could cost $600 to $900 more than the standard system we use now,” said Dan Guenzel, a sales representative for Milwaukee’s Advanced Energy Concepts Inc.


Current regulations require central air conditioners on the market to have an efficiency level of SEER 10, a standard established in 1992 during the George H.W. Bush administration. The new standards, proposed at the end of the Clinton era, will raise the level to SEER 13.


Although the current Bush administration’s Department of Energy (DOE) attempted to downgrade the change to SEER 12 in 2001, they were sued by a coalition of environmentalists. The U.S. Circuit Court of Appeals for the Second Circuit ruled that the DOE’s action was improper, and the Clinton standard remains in effect.


The new SEER 13 models will accomplish 30 percent more work with the same amount of energy as their SEER 10 counterparts. Proponents of the change to SEER 13 units hope that it will lead to decreases in pollution and the overall number of power plants.


While SEER 12 models would have been marginally smaller than the SEER 13 version, Mane Novakovich of Milwaukee’s Tesla Heating and Air Conditioning LLC, believes that replacement costs would be similar.


“You would still have to change the coil, and all the machines look like dog houses now anyway,” Novakovich said.


Some dealers disagree about how much the price of air conditioners will rise and whether or not energy savings will compensate for that increase.


Although the price for natural gas in Wisconsin is one of the highest in the nation, Wisconsin’s electric rates are fairly low, Guenzel said. Therefore, the improved efficiency of the SEER 13 systems will provide little financial benefit to customers here, he said.


“I wish I could be optimistic, but based on Wisconsin’s electric rates and weather, the return on these (SEER 13) models will only be about $10 a year in savings. You’re talking about a 90-year payback there,” Guenzel said.


Novakovich emphasized that while equipment costs may rise about 25 percent, savings will depend on energy rates, which he said are increasing rapidly. He estimates the increase in the cost for the air conditioning systems at $300 to $400 dollars.


“It will take a while, but hopefully as manufacturers begin to mass produce the (SEER 13) units, the product price might come down,” Novakovich said.


Mike Mamayek, executive vice president of Illingworth Corp., also believes the SEER 13 may be more economically advantageous.


“With the price of electricity going up and the longer summer we had this year, I think payback will occur,” he said. “It might not occur in as short of time as people would like, but it will occur.”


Mamayek believes the commercial construction market will not be strongly affected by the changing standard.


“The cost increase will be more important in the residential market because in that area the equipment costs are higher than labor costs,” he said. “In the commercial market, the increase will be insignificant in comparison to the rest of the job.”


Greg Newman, manager of heating, ventilation and air conditioning programs for Focus on Energy, a Madison based organization supported by utilities companies, is also enthusiastic about potential energy savings. However, he believes the new regulations will create difficulties for air conditioning manufacturers, as well as residential consumers.


“Contractors need to differentiate and offer a range of products,” he said. “The (SEER) 13 offers a high level of options. I think there will be a lot of pressure on the part of manufacturers to offer even more premium equipment.”


The new air conditioners are about one-third larger in size than the SEER 10 units, Newman said. By taking up more space, they will increase costs for warehousing and transportation, he said.


“It’s terrific that we’ll be able to raise the efficiency level this much, but it’s also going to cause a lot of trouble for contractors and the industry up and down the chain,” Newman said.


In the meantime, sales of SEER 10 units have been rising as some builders rush to buy the less expensive systems while they still can.


“We’ve been letting our Armstrong dealers know about the [efficiency] increase so they can contact builders and see if they want to buy units now and store them for spring,” said Claude Grieger, the president and chief executive officer of Monroe Equipment Inc., a company that supplies air conditioning units to Armstrong Air dealers.


“We’ve moved a lot of 10 SEER in the past couple of months,” he said. “I don’t like this term, but when someone says builders’ model, that generally means the lowest price model. Builders are so competitive with one another that this (price increase) has spurred additional sales for those engaged in new construction.”


Residential consumers, on the other hand, seem much less aware of the changing efficiency standard. Novakovich said he has not seen a great increase in sales this fall.


“People don’t really realize that the cost is going to go up substantially in January,” he said.

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