How Do I Know What Type Of Central Air Conditioner I Need?

Most heating and air salespeople will tell every customer they need to install an ultra high efficiency (and ultra-expensive) central air conditioning unit. The truth is, very few people actually need such a high-end unit. Even many homeowners who ultimately decide to install a 16 SEER (or higher) air conditioner don’t technically need such an ultra efficient unit to cool their homes comfortably. They install them because other considerations can sometimes make upgrading beyond a basic model a no-brainer financially,

Don’t get me wrong, I’m not against ultra high efficiency air conditioners. Quite the contrary, I think they’re fantastic. What I am against is salespeople misleading customers in order to sell more expensive equipment just so they can earn higher commissions. So I’d like to arm you with the information that will help you decide 2 things for yourself…

  1. What type of air conditioner you actually need to cool your home
  2. What factors can make a higher-end unit worth considering

What Type Of Air Conditioner Do You Actually Need To Cool Your Home

Let’s start with this basic premise… when sized correctly, even the most basic 13 SEER air conditioning unit will cool your home. Despite what any salesperson tells you, a 13 SEER unit will cool just about any home comfortably.

Should You Even Consider Installing A 16 SEER Or 17 SEER Air Conditioning Unit?

It Depends. This may come as a surprise, but installing a new air conditioner is not high on most people's list of fun ways to spend money. So why not install the air conditioner that makes the most sense for you and your home financially?

Here are the primary reasons people consider installing an ultra high efficiency 16 or 17 SEER air conditioner:

  1. High utility bills in the summer
  2. Xcel Energy rebates might offset some of the cost
  3. To qualify for special financing offers

High Utility Bills In The Summer

People who live in larger homes and older homes, especially if they have 2-story ceilings or lots of windows, will usually find it very expensive to keep their home comfortable during the summer. If your utility bills are high enough, you might want to consider a 16+ SEER ac unit. This is especially true if you are replacing your old air conditioner and furnace at the same time so you can potentially qualify for a rebate from Xcel Energy.

A 16 SEER air conditioner is approximately 20% more efficient than a basic 13 SEER unit. A 17 SEER model would be about 30% more efficient than a basic 13 SEER unit, so you can expect to lower your summertime utility bills a good bit by upgrading to one of these ultra high-efficiency air conditioners.

it’s worth spending the few minutes it takes to do a rough calculation to see how long it will take to recoup back the additional money you spend on an ultra high efficiency air conditioner. Just multiply the increase in energy efficiency (use .20 for a 20% increase for example) amount of your average summertime utility bill. Then multiply the amount you would expect to save each month during the summer by 4. (4 being the number of months that are hot enough to need your air conditioner every day here in Denver)

That will give you a good estimate of your annual utility bill savings with a higher efficiency air conditioner. Say you would save about $300/year by installing a 16 SEER unit instead of a 13 SEER. If the cost difference after any Xcel Energy rebates is $1,500, it would take you 5 years to recover the additional cost. That’s a very reasonable time frame, and certainly worth installing the upgraded unit.

Excel Energy Rebates

If you’re just replacing your old air conditioner, you can qualify for the $500 Trade-In Rebate from Xcel to offset some of the cost of installing a more efficient unit.

If you’re replacing your old air conditioner a new furnace at the same time, you can potentially qualify for both the $500 Trade-In Rebate and the New Equipment Rebate from Xcel. It’s important to keep in mind that the amount of the New Equipment Rebate you’ll actually receive depends on the EER rating of your new system, so you should think of it as being eligible for ‘up to’ the amount listed.

For example, even though the New Equipment Rebate for a 16 SEER air conditioner is listed as $500, the amount you’ll actually get back might only be $300, depending on how your new system rates out when tested for the EER.

If you can qualify for both the Trade-In Rebate and at least a portion of the New Equipment Rebate from Xcel, it’s definitely worth considering a more efficient unit.

Qualifying For Special Financing

If you’re looking to take advantage of a 0% Financing offer with an extended term (like 0% for 48 or 60 months), you will have to purchase a ‘qualifying system’ to get those terms. You can expect the 'qualifying system’ to include at least a 16 SEER air conditioner, and often times you’ll have to install a 17 SEER unit to qualify for the special financing. Don’t be surprised if you’ll also have to install a new variable-speed furnace at the same time to qualify for most of these financing promotions.

Keep in mind that even 0% Interest financing isn’t necessarily free. There will always be an origination fee built into the price of any system you purchase using financing. Typically the origination cost of the financing will range from 10% for 24 Months up to as much 15 - 20% for 48 - 60 Months.

So don’t automatically assume you’ll be coming out ahead by installing an ultra high efficiency air conditioner just so you can get 0% Financing with a longer term. So if you don’t need to install a high-end ac unit to lower your utility bills, and you don’t need extended financing terms, buy a basic air conditioner if that’s all you you need instead.