Air conditioning, gadgets drive up energy use

Near-Record Heat Wave Grips U.S. East Coast, Midwest
In-window air conditioners for sale at Lowe’s home improvement store. As a heat wave grips the nation, the increased use of air conditioning and other gadgets, like computers, is taxing energy providers.Tim Boyle / Getty Images file

Steve Shapiro never knows exactly when the deluge is going to hit, but one thing he can count on is that some time during the summer, he’s going to get busy. Really busy.

For Shapiro, general store manager at Abt Electronics in Glenview, Ill., that busy spell started Monday, when high temperatures sent his phone ringing off the hook with requests to replace faulty air conditioning wall and window units.

“The more hot days in a row, the rougher that it’s going to be,” he said.

By now, it should come as no surprise that Americans like their houses big, and they like them comfortable. That is boosting demand for energy providers — especially, as is the case now, when heat waves envelope large swaths of the country.

Cities including New York, Washington, D.C., Philadelphia and Portland, Ore., are grappling with higher-than-normal temperatures this week. In New York, where the mercury was already rising uncomfortably at dawn, high temperatures were forecast in the 90’s through Wednesday.

The latest heat waves follow similar patterns that had air conditioners humming at full blast in portions of the West last week.

Idaho Power, which supplies energy for southwestern Idaho and parts of eastern Oregon, hit a record for energy use last week amid a stifling heat wave. Spokesman Dennis Lopez said company officials believe the growing demand is due to a mix of population growth and increased air conditioning usage, although hard numbers are not yet available.

In the Philadelphia area, where temperatures hit the mid-90s Monday and were expected to stay high Tuesday, energy provider PECO is not yet seeing record demand but is watching the situation closely. Overall, the company's customers are using more energy in their homes than five or six years ago, said spokesman Cameron Kline.

Kline attributed the increase not just to air conditioning, but also to increased use of other gadgets such as more televisions and computers.

“All those things in the home do add up,” Kline said.

Like many energy providers, PECO is now offering tips and kits for saving energy, which range from weatherproofing to using more energy-efficient lighting.

“There’s a lot more demand on the home, and if consumers want to conserve we give them options to do so,” Kline said.

Energy companies also have done more to brace for increased usage. In the Chicago area, spokeswoman Judy Rader said provider ComEd postponed some projects and added work crews Monday to deal with high temperatures.

Rader said unofficial data showed Monday was one of the company's 10 biggest days in terms of energy usage, but the company did not expect to have to resort to power outages or other extreme measures.

“We are prepared for summer,” Rader said.

The growth in energy usages comes as air conditioning is becoming more ubiquitous in the United States. The National Association of Home Builders said 89 percent of single-family homes built last year included central air conditioning. That compares with 81 percent in 1996 and just 69 percent in 1986.

Some of that increase can be attributed to the fact that more are homes being built in hotter parts of the country. But Gopal Ahluwalia, staff vice president for research with the National Association of Home Builders, said builders are seeing more demand in regions where many people have traditionally just sweated out a hot spell.

In the Northeast, for example, 76 percent of homes completed last year had central air conditioning, vs. 64 percent in 1996 and 43 percent in 1986. In 1976, just 13 percent of homes built in the Northeast came with central air.

Air conditioning doesn’t necessarily add a lot to the profit margin of a new home, Ahluwalia said, but it does add a lot of marketing power.

“People want everything in their home,” he said.

A 2004 survey by the National Association of Realtors found that the No. 1 most desired feature in a home was central air conditioning. The second most desired feature was a walk-in closet in the master bedroom.

“There’s not a lot of places in the country where air conditioning is not a priority,” said Walter Molony, spokesman for the Realtors.

The demand for energy is worsened in areas where big houses, sometimes dubbed “McMansions,” are popping up. In some cases, Molony said, “The utility bills have got to be bigger than the mortgage payments.”

Still, that doesn't necessarily translate into a boon for everyone who sells air conditioners.

Shapiro, of Abt, said the yearly spike in business is predictable. And Sue Ellen Nutt, manager of investor relations for Goodman Global Inc., which makes units under the Amana and other brands, said a spike in business in one hot area is often balanced out by cooler temperatures in another.

But in a buyer's housing market like the one the U.S. is experiencing now, sellers who don’t have the cool air flowing may be in for an even tougher time. Unless that home is really special, Molony said the comparable home with the air conditioning will simply be more likely to sell.

A heat wave won’t help, either. Molony said hot temperatures often keep would-be home buyers from touring homes, although he noted that such hot spells usually aren’t long enough to impact overall sales data for a given month.

“It’s going to slow everything down, but it doesn’t mean that things aren’t happening,” he said.