Insulation, replacement windows, and gadgets may fail to deliver energy savings : Internet Scambusters #1,037
As we head into cooler weather, scammers use the opportunity to push energy-saving products and services that often fail to deliver on promises.
They're dishonest about the savings you can achieve from home insulation, replacement windows, and gadgets that are supposed to cut electricity usage.
We'll give you all the details in this week's issue, along with 10 tips that can help you beat the fraudsters.
Let's get started…
Watch Out For These 3 Energy Saving Scams
Who doesn't want to score energy savings these days? Not only are utility bills climbing, but we're also increasingly aware of the environmental cost of using our precious natural resources.
Cue a bunch of scammers and their misleading sales spiels, tricking people into handing over their cash for dubious products and services they claim will deliver those savings and make us more eco-friendly.
A big challenge for consumers is that we usually lack the technical savvy to check out these claims. So, if you don't do your research, it's easy to get conned into paying.
Here are three of the most common energy savings scams you may encounter.
Insulation Scams
Most of us know that properly insulating the walls and roof spaces in our homes can significantly reduce heat loss. But it's difficult to know what works and how much you'll likely save.
For example, a few weeks ago, a Florida company was ordered to stop making deceptive claims about a special wall paint that supposedly reduced heat loss.
They allegedly inflated the insulating power (or "R-value" in tech-speak) of their coating in their marketing materials.
With attic insulation, scammers also exaggerate the insulation properties of their products or fail to install the optimum amount of fiberglass or foam. In some cases, they even use a technique known as "fluffing" in which the material is "fluffed up" to appear thicker than it really is.
Replacement Windows
Spammers are currently bombarding consumers with ads for double- and triple-pane windows, which they say will result in significant noise and heat insulation.
While it's true that properly manufactured multi-pane windows can achieve savings, once again, scammers make outrageous claims about the R-value of their products, without providing any supporting evidence.
Often, these windows are sold via spam or using high-pressure door-to-door and telesales tactics, including too-good-to-be-true prices that give them a foot in the door. These turn out to be only for basic, standard-size frames - and you discover your windows will cost a lot more.
Sometimes, the scammers say there's a special discount for your neighborhood if you sign up now or that their reduced prices (which actually haven't been cut at all) will enable them to use your home as their neighborhood model.
They may also offer short-term warranties with all sorts of get-out clauses, which they may try to avoid showing you.
Plug-in Energy Saving Devices
Social media is full of stories about energy-saving devices developed by inventors that supposedly the big utility companies are trying to suppress.
You simply connect them to a power outlet to produce savings of up to 60 percent in energy use, they claim.
Promoters may use charts and statistics that seem to back up their energy-saving claims. But, in general these are false or, at best, misleading.
There's a technical issue behind these claims that we won't go into. But it boils down to a difference between what are called "real power" and "apparent power." Unless you're a big company, you're billed for real power, but apparent power is usually the "evidence" used in savings claims.
Of course, there are some devices that can help you save energy, most notably "smart" thermostats. These are often available at a substantial discount from your utility supplier. But scammers may sell them at an inflated price and claim the discount for themselves.
Solar Panels and More
The tricks we've listed aren't the only energy-saving scams. The current hot topic relates to solar power scams, which we plan to cover in depth in a later issue.
Others relate to unverifiable claims about energy usage in domestic appliances. Generally, the numbers you see on those yellow stickers in the store are accurate and comply with regulations - but beware that salesperson's exaggeration about how much you'll save.
Plus, there are crooks using so-called home energy audits, often described as "free," but which provide a platform for them to get into your home and invent issues that they then offer to put right.
We also covered utility scams in our issue #758, which you can read here: 5 Utility Scams and Where You're Most Likely to Encounter Them.
How to Avoid an Energy-Saving Scam
Here are 10 commonsense tips to avoid being hoodwinked by these scammers.
- Learn and understand a little about R-values. Forbes magazine has a good guide: What Is Insulation R Value? Everything You Need To Know. There's also a map showing recommended home wood frame wall insulation values.
- Ask for evidence to support any money-saving claims.
- Contact your utility providers for information on devices and tactics to reduce your consumption. Don't rely on salespeople.
- Seek customer references from contractors and others about their work and products.
- Read contracts including all the small print. And check warranties, especially for length of coverage and exclusions.
- Never sign a contract under pressure, especially with claims that the offer is only available right now. In fact, if you feel pressured to sign, that should be enough to make you distrust a salesperson.
- Beware of imposters claiming to be from utility companies or energy-efficiency experts such as the government's EnergyStar service. Don't let them into your home without thoroughly checking them out.
- Don't provide confidential financial information over the phone or to a doorstep visitor, again until you've verified their identity.
- Get at least two competitive bids for any type of insulation or replacement windows you're considering.
- If you're thinking of buying and using a device that claims to cut electricity consumption, research it on the Internet to see what others are saying. Be skeptical - mostly, they don't work.
Yes, we all want to make energy savings. But the best way of making them is to monitor your usage to identify ways of cutting back - and taking guidance from your utility providers.
This Week's Scam Alert
IRS Warning: The Internal Revenue Service (IRS) has issued an urgent warning about a sudden and massive increase in identity theft attacks via SMS text messages (smishing). The texts pretend to be from the IRS and offer help with setting up an account or news about tax credits. The scammers use a fake IRS sign-on web page to steal victims' confidential information. The agency never asks for this type of information in emails or texts, so, if you get one, it's a scam.
That's all for today -- we'll see you next week.