Vice President Joe Biden recently announced that 200,000 homes have been weatherized under the Weatherization Assistance Program (WAP). The question is, at what cost? The American Recovery and Reinvestment Act of 2009 (ARRA) appropriated $5 billion to the WAP, part of the $90 billion being proposed for national energy efficiency programs under the ARRA.
According to the GAO, as of March 31st, WAP recipients spent “$659 million to weatherize about 80,000 homes.” This comes to $8,237.50 per home. So if we have now weatherized 200,000 homes at the same cost, taxpayers have spent $1,647,500,000 to complete the task. Considering the entire $5 billion to weatherize 593,000 homes, the cost per home will rise to $8,431.70.
So is this taxpayer investment going to pay off?
Energy.gov cites a recent study claiming families will save an average of $400 in energy costs the first year after retrofits. Using the cost of a home mortgage loan at 4.43%, it will take 57 years for taxpayers to recover the initial “weatherization” investment for each home at $400 per year. So while the recipients of these improvements will save $400 a year, taxpayers will be waiting five decades or more to see a positive return on their investment. In the meantime, any temporary jobs and economic boost created by this stimulus spending will be long gone.
– Ryan Brannan