Have a Smart Thermostat? You May Be Missing Out on Cash from Your Power Company

Upgrading to a smart thermostat is already a good financial choice that can help cut your power bill. They let you use energy more efficiently, such as by reducing wasted HVAC when you're not home.

But your smart thermostat can also help you save on your bill in another way: through rebates from your power company.

How the programs work

The specifics of each program vary. Generally, however, you'll agree to let the power company adjust your thermostat before and during high-demand events so you're using less power when the grids are most burdened.

For example, the power company may pre-cool your house a few degrees before the event, then raise your thermostat temperature during the event to reduce your power usage. This would only occur during specific periods of high energy demand, and it reportedly doesn't last more than a few hours per event.

What's the savings?

In return for joining these programs, you typically get a one-time sign-up bonus, then an annual rebate. Now, it's not much; you get a larger amount for signing up -- $50 ro $75 -- then around $20 to $40 annually.

However, there's another thing to consider: Many areas charge more for power used during high-demand periods. By letting the company pre-cool your home, then reduce your usage, you should see a positive change to your energy bill because you'll be using less power during peak demand.

Determining your eligibility

A quick internet search for the name of your power company plus "smart thermostat" should show any rebates or programs you could join. Alternatively, you can contact your power company directly and simply ask. If your power company has a modern mobile app, you may also be able to find any rebates or incentive programs in the app.

Note that you need to specifically have a smart thermostat. These are wifi-enabled thermostats that connect to the internet. A regular programmable thermostat without connectivity won't be eligible.

If you don't already have an eligible thermostat, check with your power company before you go shopping. Most power companies I saw offer some type of rebate or discount to upgrade.

Other tips to keep energy costs down

Even if you don't sign up for the rebate program, a smart thermostat can definitely help you save money on power bills. But it's hardly the only thing you can do. Here are a few other ways I save on my energy bills.

Get rid of drafts

Summer or winter, leaky doors and windows that let the heat out in the winter (or in during the summer) are a bane to power bills. You'd be surprised how much heat can travel through a few poorly fitted windows.

Inexpensive weatherstripping can do wonders for leaky seams. And draft stoppers fitted to the gap under your door can make for surprisingly effective insulation.

Request an energy audit

You can hire a professional to perform an energy audit of your home. They'll go through your home with all sorts of neat equipment (those thermal imaging cameras are super cool!) and find all of the areas with drafts and/or poor insulation. They can also offer advice on the best way to address these issues.

Have your HVAC system serviced

An HVAC system that isn't operating at peak efficiency is costing you money. You should be changing your furnace and/or AC filter at least every three months (more often if it gets dirty faster). Additionally, you should have the heating and/or AC system professionally serviced every year.

Use rewards credit cards

I pay for everything I can with rewards cards, my utility bills included. In particular I earn 5% cash back on all of my power bills with my U.S. Bank Cash+® Visa Signature® Card.

If you don't have (or want) a dedicated card for your bills, simply using a good 2% flat-rate cash back rewards card could save you a decent amount over the course of a year. Just make sure you're earning more in rewards than whatever fee your utility company charges for using a credit card.

Knowledge is savings

When it comes to keeping your finances in order, any savings is generally good savings. If you already have a smart thermostat, you could be missing out on easy money and energy savings from your power company. Even if you don't sign up, it's still worth being aware of the savings programs out there.