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| 01-04-2009 4:07:07 PM - 11 Comments | Posted By: Alan Meier |
| January/February 2009 Editorial: Now We Know the Value of Energy Star |
 The elections overshadowed a press release by Energy Star announcing a settlement with LG, one of the world’s largest manufacturers of appliances and consumer electronics. That’s a pity because the settlement sends an important message to manufacturers. It also reveals how valuable LG thinks the Energy Star endorsement actually is.
Recall that Consumer Reports (and Home Energy almost a year earlier) found that LG refrigerators were designed to either circumvent DOE test procedures or were tested in such a manner that led to a much lower energy use than what would actually occur in real kitchens. Indeed, these measures reduced the energy consumption enough so that the refrigerators qualified for an Energy Star endorsement. LG’s methods have been an open secret for some time and the Australian Government actually fined LG for a closely related infraction last year.
The terms of the Energy Star settlement are stunning. LG promised to replace a circuit board in each of the several hundred thousand refrigerators covered by the agreement. The circuit board will (presumably) result in lower energy use though it’s not clear from the statement how this will be accomplished. Replacing the circuit boards will require an LG representative to visit every home with a refrigerator. In addition, LG will reimburse owners for the additional electricity used caused by this design for the average lifetime of the refrigerators (but paid in advance).
How much is the settlement costing LG? Let’s assume that the settlement covers 300,000 refrigerators. I can’t imagine a home visit by an appliance technician to cost less than $80. The reimbursement for higher electricity bills will be $30 a year for 14 years (which will be made up front rather than in installments). Together, these actions cost about $500 per refrigerator and roughly $150 million for the whole settlement.
What made LG offer this settlement? Perhaps they settled because the alternative would have been even costlier. DOE could have asked to remove Energy Star endorsements from all LG products, that is, from refrigerators to TVs to washing machines. LG evidently thought that the potential damage to its reputation from loss of the Energy Star designation on all products exceeded the costs for repairs and reimbursements for refrigerators.
This settlement is also a signal to other manufacturers veering close to the edge of misrepresentation of energy use that they shouldn’t mess with DOE. Rumor has it that DOE is aware of several manufacturers in that position.
Consumer Reports recently used the article title, “Energy Star has lost some luster.” Perhaps, but you wouldn’t know it from LG’s actions.
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| Date & Time |
Comment |
By |
01-20-2009
12:45:39 PM |
Alan-
Nice post. It's very interesting to see how far LG was willing to go to keep the Energy Star seal of approval..... especially in today's economy. To everyone who thinks that consumers will start to be "less green" once money dries up- Talk to the CMO of LG!
-Cydney-
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Cydney W. |
02-12-2009
11:34:02 AM |
I’m an Energy Star Service Partner and having the name and backing has really helped my energy audit company in San Diego, CA reach more customers and also provide them with the knowledge that they are getting good advice on the best ways to save energy in their homes. |
Energy Hoarder |
02-12-2009
5:14:13 PM |
Home Energy Fraud -
My home was built in 2007 and was to be an Energy Star labeled home. However the home builder completely ignored the Thermal Bypass Checklist, even though their own Rater/inspector checked 7 items as "Corrections Needed." Is this occuring in other parts of the country? According to some Raters/inspectors that I have talked with the answer is YES. What is the EPA doing about this? Answer - very little. Are they suspending the home builder partner from participating? NO. Is the Rater/Inspector still rating and labeling homes as Energy Star, when they are not in compliance with the TBC? Looks that way.
Are the greenhouse gas emissions accurate as reported to the EPA on the REM/RATE and proudly proclaimed on the EPA website as SAVINGS or they just purely fictional paper savings recorded for global warming fanatics to get all warm and fuzzy over? My home did not save on emissions. I have the actual energy costs to prove it for one year, and over 35 color infrared pictures. The great thing about color pictures, they don't lie. Too bad home builders don't care about the truth.
Recent comment to a rater by a home builder, "I don't care if the home does not qualify for a tax credit, the other rater said it did." ENERGY FRAUD COSTS EVERYONE DOLLARS, HOME OWNERS AND TAXPAYERS. Your article about refrigerators is interesting, and I read about this months ago, however the problem persists in thousands of homes across the country, and I would think that the energy consumption of an entire home is more than a fridge. Is it more than the 300,000 refrigerators? IT IS IF 20% OF THE 120,000 ENERGY STAR LABELED HOMES LAST YEAR are like mine.
Bruce Wingfield
7429 Upper Cambridge Way
Westerville, Ohio 43082
614-891-2151
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Bruce Wingfield |
02-24-2009
8:40:45 PM |
If you go to www.ripoffreport.com and search for Energy Star you will find one consumer who tried in vain to have LG make repairs to his refrigerator. In fact, he claimed that no one at LG knew what he was talking about. DOE is asleep at the switch as it relates to Energy Star. All Talk, no enforcement.
Bruce Wingfield
Westerville, Ohio |
Bruce Wingfield |
03-27-2009
8:46:16 PM |
I strongly disagree that LG is taking the issue of its Energy Star fraud seriously. They are getting off very easy. They should permit consumers who bought refrigerators based on fraudulent information to get their money back and use it to buy a refrigerator that actually meets the Energy Star standard.
AND...the LG offer does not even attempt to address the additoinal global warming produced by their energy hog fridges. This is particularly appalling to those of us that purchased the fridge as a way to reduce our contributions to global warming.
Check out -- www.lgfridgefury.org for an example of how people are still fighting to ensure LG actually pays for its deception. |
Victim of LG Fridge Fraud |
07-30-2009
8:29:26 PM |
Wow, I didn't know about this settlement. We bought an LG fridge 2 years ago because it was backed by energy star. That is really upsetting to learn. We have really spent a lot of time making our home energy efficient. Hopefully LG will make things right. Shelly Energy Efficient Mortgage |
Green Mortgages |
10-06-2009
2:42:17 PM |
This article states that they were unaware as to how the new board was to reduce energy consumption. Well here's the fix Ladies and Gentlemen. Some geniuses at LG designed a board which eliminates the heater to the ice maker. The result is lower energy consumption. The result is also an ice maker that freezes up and doesn't make ice, moisture and ice collecting on the side of the refrigerator and water leaking (from the ice and condensation) to your floor. By the way, I had a service repairman out at the suggestion of LG. It was discovered that this energy "fix" also renders your refrigerator "non-repairable". I have a new refrigerator on the way to replace mine, compliments of LG. I am seeking a way to be reimbursed for the service fee I had to pay to find out that this was an engineering blunder which LG is already well aware of.
LG customer service reps Valerie and Simone, who are not very helpful and refuse to let you speak to anyone above their employment level, will tell you that LG doesn't reimburse and will attempt to tell you that the unit is out of warranty. Even after explaining that this is not a warranty issue but rather an engineering blunder to repair the energy consumption issue and should be considered unconscienable to require the consumer to pay a service tech for an issue LG engineers know exists, they still refuse to reimburse. I forsee another civil action in LG's future if this stand does not change. |
Rick |
10-24-2009
8:03:27 AM |
Fox News channel (Bulls and Bears) just made a big deal about how the "Energy Star Fraud" implied that the gov was incapable of doing anything especially anything to do with climate change. They did not mention specifically what the fraud was. I searched and this was about the only significant related item. And it was fixed in 2008 by the DOE. So, is this it? If so, Fox News opinion programs is full of you know what.
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Gene Kimzey |
11-19-2009
12:34:50 PM |
And if not, Gene, then I guess it would be your opinion that Fox News is not full of 'you know what'?
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Alan |
01-23-2010
12:53:28 PM |
where do you go to file for this "reimbursement"? I didnt know about this until I read it in consumer reports. |
Don |
03-30-2010
9:40:15 AM |
Has anyone had the fix done to their refrigerator yet? I'd like to know if it had a negative effect on the performance of the refrigerator. I see nothing but negatives from the posts I've been able locate. People are complaining of frost suddenly appearing. They also mentioned having to set the temperature lower in both the refrigerator and freezer to get the same results. |
Frank Fontana |
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