Payback time

I just did the energy analysis at my gas/electric company's website. I have to say, some of the information surprised me. For example...

Who hasn't heard the old tightwad tip to wrap your water heater? According to Consumers Energy, wrapping your water heater will cost you between $11-19 and will save you $2-3 a year. Air drying your dishes instead of running the "dry" cycle on your dishwasher will save you $7-12 a year.

Now I know that all of these small things add up. I know that by doing a handful of them we could save $100 a year, or more... Maybe?

Enter Payback Time
Before you decide to do anything, figure out how long the payback time is. Payback is when the cost of the item is offset by the money you will save. For example:
If I spend $10 on a widget that will save me $2 a year, the payback time is 5 years.

Cost ÷ monthly savings = Payback time

(Ok, it can be a little more complicated, by factoring in the life of the new product vs. life of the old product, etc. but you get the idea.)

Example: According to estimates, changing all of your bulbs to compact fluorescent will save you $38-47 a year. I found compact fluorescent bulbs at Sam's Club, and was able to change most of the bulbs in my house for around $18. My local club has an 8 pack of 13 watt (60 watt equivalent) for $12.73. (They have a 10 pack available online for $24.33 + shipping.) So my payback time was less than a year.