Do Smart Thermostats Save You Money?


Smart thermostats are becoming the fastest rising trend in smart home technology, forcing more people than ever to rush to understand the technology. You may be one of those people that are wondering if they can save you money, or if they are an unnecessary expense. You would not be alone, many people are wondering the same, so we’ve decided to help you answer that question for yourself.

So, can you really save money using a smart thermostat? We would love to give you an easy answer to this question. The truth is that whether or not it reduce your energy bill depends on several variables. These include:

  • Your current energy usage
  • Your heating and cooling habit
  • Where you live
  • Your daily habits
  • Your home’s occupants
  • Your home’s insulation 
  • And more…

In order to determine if they can save you money, you really need to analyze your specific situation. Don’t worry if that sounds too complicated. We’ve put together this guide to help you decide if a thermostat might work in your home and if it could maybe save you some money down the road.

What is a Smart Thermostat?

It may sound a little like science fiction to some people, but the technology available is actually cool. A smart thermostat replaces your existing thermostat or programmable thermostat and integrates smart technology to control the HVAC system in your home to meet your needs, or what specific programs you may set it to follow and save you money on your energy bill.

Smart thermostats take programmable thermostats a step further with the remote capacity. Some smart thermostats can even compensate for other environmental changes, such as humidity. You can also analyze your energy usage with most smart thermostats with their companion apps.

What Can a Smart Thermostat Do?

Not only can a smart thermostat control the temperature in your home, heat and air conditioning (depending on your HVAC system), many smart thermostats can give you control over your homes climate system, even if you are nowhere near your home. 

Some smart thermostats provide this remote control capability as well as the technology to learn your habits (and your family) and adjust accordingly. For example, in a short time after installation, if you come home from work every day at 5 pm, the smart thermostat can adjust the temperature in your home so that it is at your desired temperature as soon as you get home. When the home is empty temperatures are adjusted to use less energy.

A smart thermostat will also alert you to issues that may arise, such as a when it is time to change the air filter. 

Smart Thermostat VS Programmable Thermostat

A smart thermostat is basically a programmable thermostat on steroids. It has all of the same features as any programmable thermostat, including home and away settings, personalize temperature settings, and automatic options for both heating and cooling (when necessary).

The reality is, if you already have a programmable thermostat, then upgrading to a smart thermostat may not be necessary. You will be adding remote access and maybe even learning capabilities, but may not see major savings with the switch.

Homes with traditional analog thermostats could potentially see some major savings using a smart thermostat. Homes with compatible HVAC systems would gain programming and remote capabilities as well as additional features depending on the model purchased.

Advantages of Using a Smart Thermostat

You may be wondering what the real advantages of having a smart thermostat. People that are not quick to jump on the latest smart technology may be in for the biggest surprise. Automating your homes climate control and heating system can offer some great benefits. Let’s take a look at some of the specific advantages.

1. No More Forgetting 

Have you ever been home for a few days and bumped the heat up or air conditioning down only to return to work and completely forget to set the thermostat back to normal? 

Maybe you like your home colder when you are sleeping, which many do. Overnight temperatures drop, sometimes drastically, even in the hottest of summers. The problem is, if you forget to set that temperature back to a reasonable level in the morning, then your AC is going to be running hard all-day, costing you more money in the process.

2. Remote Access

This is one of the benefits of a smart thermostat that makes it so worth it. Take a look at these scenarios to realize the benefits of remote access to your home’s thermostat.

Control from Anywhere

Every smart thermostat uses Wi-Fi to connect to your homes network, as well as, an app you can get on most smart devices, such as a smartphone or tablet. You can even get access to some on a PC or laptop. This gives you the ability to adjust your thermostat from virtually anywhere. 

Working Late? Delay the cool down until you are closer to heading home. Caught a cold and just can’t get warm? Bump up the temperature when you head home sick from work to keep from walking into a freezer (or what feels like it).

Second Homes 

If you have a vacation home, cabin, or another secondary home that sits empty for any length of time a smart thermostat is a fantastic choice. You can not only set the temperature to be just right when you arrive, but remote access also gives you the ability to monitor the thermostat of your other home. 

This is especially important for second homes in areas where the temperatures may change drastically, especially if they can drop below freezing suddenly and without warning. You wouldn’t want to risk pipes freezing, so you can easily prepare for a freeze warning and protect your home, from anywhere.

3. Alerts

Smart thermostats can offer several alert options, the most common and probably most important, is that a smart thermostat will let you know when you need to change the filter; the most important maintenance to ensure your system works best.

4. May Save Energy and Money

Energy and money savings are definitely possible with a smart thermostat. They give you the option of analyzing your energy consumption and make changes to your usage to save the most energy. Anytime you take steps to optimize your energy usage it will end up saving you money in the long run.

5. Easily Managed and Programmed – User Interface

Smart thermostats utilize the best programming technology coupled with apps that give you flexibility and control. All of the top smart thermostat manufacturers work hard to develop simple to use apps so you do not have to be a tech geek to program and operate your system.

6. Energy Use Analysis

One of the coolest advantages of installing a smart thermostat is the ability to see your energy usage in detail. This will allow you to make tiny adjustments to the system and your routine that can lead to a more efficient system and lower carbon footprint.

Types of Smart Thermostats

Not all smart thermostats are the same, or there would be no reason for multiple models, right? The best thermostats will have both of the following features, but some only have one.

  • Learning Thermostats

Some smart thermostats can learn your routine and make automatic adjustments. Initial set up will likely involve you setting up your basic schedule, the thermostat will then use that schedule to determine your temperature and make changes throughout the day as your home become more or less occupied. 

  • Remote Controlled Thermostats

The one improvement that smart thermostats have over programmable thermostats is the remote access capabilities. Most smart thermostats have this feature, though the remote options may vary between manufacturers. Some come with complete remote access while others may have more limited options.

Saving Money with a Smart Thermostat – Why it Varies

The reason that saving money with a smart thermostat cannot be easily explained is that every home uses their heating and cooling systems differently. There are several variables that can influence your energy usage and how much, if any a smart thermostat may be able to save on your energy bills.

Existing Thermostat

As we mentioned the type of thermostat that is currently in your home will have a big influence on your potential savings by upgrading to a smart thermostat. Homes with an analog or manual thermostat should upgrade to a smart thermostat (or at least a programmable one). You will undoubtedly save energy and money with the upgrade. 

Your Energy Habits

Depending on your family’s unique habits, your energy consumption may be improved using a smart thermostat. Some families may already have habits and consumption that is the most energy-efficient, they will see the lowest savings, if any. Here are some of the things that can have an impact on your energy consumption that may NOT benefit from a smart thermostat.

Home All Day

Homes with someone in most of the day will not see many benefits from a smart thermostat over what could be provided by a programmable thermostat.

Eradicate Schedules

Specifically learning thermostats work on the ability to detect when you (or someone else) leaves or enters your home. If there is no discernable routine exists, then the smart thermostat will not be able to make the small adjustments that can save you money over a programmable thermostat.

Multiple Occupants

Similar to the reasons above, homes with larger families will be more likely to have someone in them, or coming and going at different times. However, if your family, no matter the size has regular schedules then you may see some savings.

How You Optimize Your Energy Usage

Many homeowners already do everything they can to optimize their energy usage, while others leave that up to their thermostat. The later would experience the most benefits from upgrading to a smart thermostat, especial one with learning capabilities. After installing and initial programming, a smart thermostat takes total control and optimizes your energy usage. Over time, you may even see more energy savings.

Home Insulation

One aspect of a home that can have a huge influence on how hard your HVAC system works is the insulation. Home with lower insulation levels, leaking windows and doors will have a harder time keeping their energy costs down no matter what type of thermostat they use. While a smart thermostat may provide some improvement, we would suggest improving your home’s insulation first.

Climate Variations

Some people are lucky enough to live in climates that get neither too hot nor too cold. Many homes in these areas may not even have central heating or air conditioning, so would have no need for a smart thermostat. 

On the other hand, if you live in an area with regular drastic fluctuations in temperatures that may not follow predictable patterns a smart thermostat may not provide as many benefits without your intervention. 

Is a Smart Thermostat Worth Buying?

Deciding whether a smart thermostat is worth buying is going to depend on several things, including your current energy usage, as well as all of the other variables listed above. So, how can you decide? Look below to get an idea of the potential savings that may relate to your home compared to the costs associated with installing a smart thermostat.

Potential Savings VS Cost of Smart Thermostat

Cost of a Smart Thermostat

There are really only two costs involved in upgrading to a smart thermostat; the price for the thermostat you choose, and the cost to have it installed. These can obviously vary depending on your location and where you buy your thermostat.

  • The average* cost of a smart thermostat will cost between $200 and $300
  • The average* cost of professional installation will be between $130 and $170
  • Additional costs may include:
    • Additional Remote –$200
    • Required Smart Hub – $100-$200

*average cost based on nationwide HVAC statistics

Calculate Your Potential Savings

There are a few calculators you can use to get a better idea of your specific potential savings.

  • The most accurate calculator includes the ability to enter your current usage and see how energy and money can be saved making small adjustments (that a smart thermostat may do automatically).

Ways to Boost Your Energy Savings – Using a Smart Thermostat

Enter Your Schedule 

Most smart thermostats give you the option to enter your specific schedule. This will give the smart thermostat a baseline and the ability to adjust the temperature in your home to match your schedule. Over time it will be able to suggest small changes to optimize your energy usage.

Be Flexible with Temperatures 

Some of us use the temperatures in our homes to make us the most comfortable without little flexibility. In reality, we could likely be nearly as comfortable with the temperature a couple of degrees one way or the other. Being just slightly flexible can add up to some big energy savings over time.

  • When it is warmer outside, set your thermostat a few degrees higher – use fans to help circulate the air.
  • When it is colder outside, bundle up, wear socks and slippers, and throw blankets and turn the heat down a little bit.

Remember to Adjust to Changes in your Schedule

As smart as your new thermostat can be, it cannot read your mind or make drastic changes on its own. Whenever your schedule changes significantly, remembering to adjust your schedule in your smart thermostat interface can save energy by eliminating the time needed to make automatic adjustments.

Optimize App Usage

Many of the most popular smart thermostats come with great apps and user interface, that will not be much help if you don’t use them. Using these options to find ways that the interface can help you optimize your energy usage even more than any thermostat can do automatically.

Use Vacation/Away Settings

There are some pretty cool settings that can quickly adjust your usage for times when you will be away from your home for an extended period of time. As the advantages of installing a smart thermostat in a second home, the setting for lengthy absences can be one of the easiest ways to save energy and money.

Smart Thermostat Buying Guide

What to Know Before Buying

There are a few things that you need to know before shelling out any money on a new thermostat. Most of this information can be found using the brand and model information of your HVAC system. If you do not know this information, refer to your owner’s manual or look for the information on the HVAC unit. 

Compatibility

The most important thing you need to know is if your HVAC can be connected to a smart thermostat. 

  • Is your HVAC system a stage 1 or stage 2 system? 
    • Once you know what type of system you have, the rest is easy. The easiest way to determine what time of system you have is to refer to your documentation or look up your system by model number.
    • If you feel comfortable checking the connections of your existing thermostat can be one way of determining your system type.
  • What smart technology will be used with your smart thermostat?
    • Homes with existing smart tech, particularly a smart hub, will want to find a smart thermostat that is compatible with that system.
    • If purchasing a new smart hub, we recommend using one of the ones recommended by the smart thermostat manufacturer, with the widest compatibility with other smart tech devices.

Features

Know what features you want in your smart thermostat.

A quick checklist of some of the most common features available with smart thermostats include:

  • Built-in Speakers – some smart thermostats provide many of the features that can be found in some of the most common smart devices, including music and virtual assistants.
  • Voice-Enabled (directly or through connection to smart hub) – this feature allows you to use voice commands to control the thermostat from anywhere within range of the voice system you use.
  • Remote Sensors – a key component of many of the customization features of a smart thermostat is the quality and number of remote sensors that can be connected to the smart thermostat. These sensors allow zone controls, geofencing, and most learning technology.
  • Zone Temperature Options – Particularly larger homes can benefit from flexible zone programs that set different areas of your home to different temperatures, and even the option of shutting off areas that are rarely used.
  • User Interface – this is the app or another control device that you will use to adjust your system. Most smart thermostats come with a free smartphone app that gives you that control and ability to adjust your thermostat instantly.
  • Learning Technology – Some of the most advanced technology found in smart thermostats allow them to make specific personal adjustments based on the activities and adjustments that it detects. This technology often uses remote sensors to detect activity.
  • Scheduling – This is the option that those that currently have a programmable thermostat will be most familiar. This is available on most, if not all, smart thermostats and gives you the ability to program your thermostat to set schedules. A smart thermostat can then use that schedule as a basis for optimization changes.
  • Geofencing – Geofencing is a technology that uses your smartphone’s location to determine where you are and how close you are to your home. Some smart thermostats allow for geofencing as far as 7 miles from your home. The smart thermostat then adjusts your system in expectation of your arrival (also uses the same when you leave the “area”).
  • Touchscreen – Some smart thermostats have integrated touchscreens that give you many of the same interface options as the apps may offer directly on the thermostat. While this is not required in every situation, it does give you additional control directly at the thermostat; important if something happens to your phone!

Best Smart Thermostats

Smart thermostats are still a fairly new technology, so the field of options are still limited. However, there are a few companies that are taking a commanding lead in the industry. Here are the best ones currently available and what they each have to offer.

ecobee 5

The current undeniable leader in smart thermostats is definitely ecobee. Their newest model, the SmartThermostat with voice control offer the latest technology and whole new experience in a smart thermostat. 

This thermostat features SmartSensor technology that reads not only a rooms temperature but whether or not the room is occupied, adjusting the comfort level accordingly. The new built-in Alexa voice features allow you to use your voice in your favorite ways, to make calls, play music, and even control other smart devices.

Nest Learning Thermostat 

Coming in close behind is the Nest Learning Thermostat. This is the third version of the smart thermostat from the Google-owned company. Where this one excels is in its ability to communicate with multiple systems, not only Google Home, by Amazon Alexa, IFTTT, Samsung SmartThings, just to name a few. The only limitation is the Apple HomeKit, sorry Apple lovers.

The Nest Learning Thermostat is designed to learn your habits and make intuitive adjustments accordingly. For example, when you come home after a long day of work, the Nest will raise or lower the temperature to make you more comfortable. If you are settling in to watch your favorite movie, cuddling with your partner the Nest’s intuitive features will adjust for the number of people in the room.

Honeywell Lyric T5

By far the best budget-friendly smart thermostat has to be the Lyric T5 from Honeywell. It offers many of the same features as the more expensive thermostats, including automated temperature controls, Alexa voice-enabled controls, and mobile alerts. 

Where this thermostat shines the most is the inclusion of geofencing technology. This allows the smart thermostat to adjust based on your geographic location. Hint: it isn’t that smart, it uses the GPS in your smartphone, but that is still pretty cool. 

The biggest drawback to this smart thermostat is its lack of compatibility with some of the biggest names, including Google Home, Samsung SmartThings, Wink, and IFTTT. While it does work with Alexa and Apple HomeKit, this limited compatibility makes it a less desirable option for many smart home techies.

Final Thoughts and Recap

In short, a smart thermostat could be a great way to reduce the amount of energy you use, which may lead to cost savings in the long run. Smart thermostats can include several additional features that will allow you to control the temperature of your home from anywhere and even analyze your energy usages. 

We hope we have provided you with the information you need to make the most informed choice for you and your family. Many homes can see savings that can more than offset the cost of a smart thermostat, while others may not experience any tangible savings. Best of luck for you to decide what is right for your unique situation.

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