Strong Demand Seen For Energy-Efficient Majaps

By Alan Wolf On Sep 15 2008 - 6:00am




One of the few shining stars in an otherwise tepid white-goods market are energy-efficient appliances that have been certified as such by the federal government's Energy Star program.

According to a recent spate of reports from market research firms The NPD Group and J.D. Power and Associates, as well at the Association of Home Appliance Manufacturers (AHAM), Energy Star-rated majaps, including washers, refrigerators, dishwashers and room air conditioners, are significantly outselling their less-efficient counterparts despite steep price premiums.

Industry observers believe the trend is being stoked by higher energy prices and a growing concern for the environment.

Point-of-sale information compiled by NPD's retail-tracking service, which plugs into participating retailers' checkout data, indicated that unit sales of Energy Star washers grew 3 percent during the second quarter of 2008 compared to the prior-year period, while unit sales of non-energy efficient models declined 12 percent.

Energy-efficient washers comprised 40 percent of all units sold during the April to June period, but garnered 55 percent of the dollar share, reflecting their significantly higher price points.

Among refrigerators, second-quarter sales of Energy Star-rated models increased 15 percent in dollars and 13 percent in units year-over-year, compared to 11 percent declines in unit and dollar volume for less efficient fridges. NPD noted that average selling prices of Energy Star-rated refrigerators have been more than double those of regular models, although the differential has diminished over the past two years.

In room air, second-quarter sales of Energy Star ACs grew 50 percent in both unit and dollar volume year-over-year, and represented about 60 percent of all sales in dollars and units.

Energy Star ratings lost some of their shine when it came to dishwashers. After several years of consistent double-digit growth, sales of energy-efficient models generated only a 5 percent increase in dollars and a 2 percent gain in unit volume during the period — perhaps reflecting their nearly 70-percent price point premium over less efficient models, NPD said.

On the wholesale level, factory shipments of Energy Star washers, refrigerators and dishwashers rose 55 percent during the first six months of 2008, according to the trade association AHAM.

Further bolstering the sales data is a customer satisfaction study released last month by marketing information firm J.D. Power and Associates (see story this page), which showed that the percentage of consumers who purchased high-efficiency washers grew to 60 percent in 2008, up from 53 percent in 2007. In addition, approximately two-thirds of respondents reported that their new laundry appliance is Energy Star certified.

The switch to more-efficient home appliances has had a major impact on power consumption, with majap energy usage down 43 percent since 2000, AHAM reported. Specifically:

  • washer energy consumption has decreased by 63 percent while tub capacity has grown by 8 percent;

  • dishwasher energy consumption has dropped nearly 30 percent and water consumption has declined 29 percent; and

  • refrigerator energy consumption has decreased 30 percent and efficiency, measured by a model's energy factor, has increased 39 percent.

From a global climate change perspective, the energy savings realized in 2007 shipments of all three product categories would offset the carbon dioxide emissions of nearly 700 million gallons of gasoline consumed.

"Appliance manufacturers have shown a commitment to efficiency that goes well beyond adherence to federal efficiency standards," said AHAM president Joseph McGuire. "Through additional investments in technology and consumer awareness, partnering with retailers, and promoting Energy Star, our industry has led the way in taking residential energy efficiency to the next level."

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