Let others put their retirement investments in banks and brokerage
houses, Phil Duran has put his portfolio in his basement - oh yes, and
also on top of his barn. He has a portion in his fields, too.
Duran is a Lawrenceville resident and the owner of Envirophysics
www.envirophysics.com), a one-man firm that performs geological
surveys for engineers, environmental scientists, archaeologists,
police, and military investigators. A graduate of the the University
of Connecticut (Class of 1979), he holds a master's degree in
geophysics from Boston University, and did extensive doctoral work at
Rutgers. His father, Manuel Duran, taught Spanish literature at Yale
and is an acclaimed poet and the co-author of "Fighting Windmills." He
mother, with specialities in English and Spanish, was also an
academic. His wife, Kyra, is the editor of the League of
Municipalities magazine and the magazine of the New Jersey Board of
Some 12 years ago the couple, then living in Yardley Borough and
yearning for more elbow room, found a nightmare of a dream house. They
have turned the wreck around, and want to stay there for the rest of
their lives, well past retirement age. But they know that the state's
high cost of living, including murderously steep utility bills, has
forced many a golden age couple to relocate. So, instead of spending
their spare cash on scouting trips to the Carolinas, or stashing all
of it in mutual funds, hoping that it will grow, they have been
methodically paring down their cost of living.
"People think of how much income they will have in retirement," says
Duran. "They don't think about out-go." Heating oil alone can run to
$4,000 a year in a house the size of the Duran's, about 2,700 square
feet. Electricity can easily add another $3,500 to a household's
expenses. Then there are property taxes, which can run up to and right
past five figures. None of these costs are going to be lower in 15
years, when Duran, now nearly 50, is set to retire. He is sure that
the reverse will be true, and dramatically so, at least in terms of
costs related to fossil fuel.
"Prices are down a little now," he says, "but they are going to go up
again." He cites mathematical analyses and studies of international
trends to support his contention that the peak of American oil
production occurred in 1970 and that the peak of international oil
production is occurring right about now. Even factoring in discoveries
of new oil fields, he says, new worldwide demand from a number of
countries, including rapidly industrializing countries like India and
China, means not only that prices will rise, but that gas and oil may
become difficult to obtain at any price.
Should spot shortages occur, the Durans will not be much affected. Or,
as a neighbor says, "If the world's coming to an end, we're going over
to Phil's house."
The Duran house, now pretty much self-sufficient in terms of energy
use, was anything but when the couple first saw it. When they began
looking for a house, says Duran, "our choices were limited. We could
afford a decent house with no land, or a lot of land with a bad
He fell hard for a home squarely in the latter category. A farm house
with numerous out buildings on 10 acres of land, it had been on the
market for five years and was about to be condemned. The electrical
system was so bad that municipal authorities insisted that it be
replaced. The furnace and septic systems were shot, and so was the
roof - "literally," says Duran. "There were bullet holes in it."
The next step was a gut renovation, necessary for so many reasons,
including the fact that the house had been sub-divided into two units,
complete with two kitchens. It also had two staircases, which carved
up the house in an awkward, difficult to reconcile way.
When they bought the house, the couple had planned to complete the
renovation in stages, but Duran's grandfather died just as they were
about to begin. His bequest turned out to be the sum they had
calculated that they would need to turn the derelict into a home.
It was not, however, enough to allow for the installation of the
costly equipment that can let a homeowner supplant gas and oil with
the heating, lighting, and cooling power of the sun and the earth.
Perhaps ironically, it is vastly more expensive to harness these free,
universally available resources than it is to use oil from several
continents away. Therefore, most people don't.
"The average American moves once every seven years," Duran says, "so
there's not a whole lot of incentive to put money into conservation."
The pay-back time for the installation of energy-saving devices,
ranging from double-pane windows to geothermal heat pumps, can be
eight or more years.
Planning to stay put for the rest of his life, Duran, whose family
includes 11-year-old Alexis Duran, a Chapin student, Ronald Wong, a
medical student at the University of Medicine and Dentistry of New
Jersey, and Loriann Wong, graphic designer for a web-based car parts
distributor, is willing to make the investment.
He just finished putting in snugly fitting, energy efficient windows,
and is planning a trip to Lowe's to get more insulation to blow into
his walls. But that's the least of it.
Having been ordered to tear down his outbuildings, and with a house
shaded by trees, facing in the wrong direction to catch the sun, and
"not angled right," Duran built a south-facing barn to hold solar
panels. He had the panels installed two years ago, when state
subsidies covered 70 percent of the cost. The state subsidy has since
dropped to 50 percent, but Duran says that it is still among the most
generous deals in the country. The state offers help with the cost of
solar panels up to 10 kilowatts. Duran installed an 8.4 kilowatt solar
array. It cost $64,000, but with state rebates, he was only $19,000
out of pocket.
"Before the solar panels, I was paying $185 to $325 a month for
electricity," he says. "Last year my electric bill was minus $1,000."
This is so because his utility company, PSEG, is under a mandate to
supply a certain percentage of its power from renewable energy
sources, including solar power. Unable to meet its quota from other
sources, the utility buys excess power from homeowners like Duran.
When the panels pull in more juice than the family needs, it is
automatically redirected back to the utility for use elsewhere, and
the Durans are compensated for it.
With the lights - and computers, hair dryers, and televisions -
powered on-site, Duran turned to the home's heating and cooling costs.
Heat, provided by the oil furnace he installed during renovations,
cost more than $2 a gallon last winter, for a total oil bill north of
$4,000. Unplugging his family from that bill, Duran has just installed
a geothermal heating and cooling system.
The home has two geothermal exchange units, serving each of the home's
two floors. Located in the basement, the units are about the size of
central air conditioning units. After processing the well water, the
system dumps it into the pond out back. The system cost $34,000. The
payback time for Duran will be about eight years, or possibly much
less if the price of oil spikes.
Duran has now cut his family's utility bills by some $7,000 a year. Is
he through? No, not at all. He would like to add fuel cells to the
mix, insuring a steady flow of electricity at midnight, during snow
storms, and in every other instance during which the sun refuses to
show its face.
"The technology is there," says Duran, "and it's so reasonable." It
may be reasonable as a solution to dependence on foreign oil and all
that that entails. But it is not reasonable for conservation-minded
homeowners' budgets. Duran knows someone who has just finished putting
together a hydrogen-powered fuel cell using grants from the state. "It
cost him hundreds of thousands of dollars," he says. Duran says that
he doesn't have that kind of money laying around for that purpose -
"or for any purpose" - but he is intent on moving ahead "little by
little" toward the goal of being energy self-sufficient.
Receiving checks, rather than bills, from PSEG, will make Duran's
retirement more comfortable. He has also turned four acres of his
property into a Christmas tree farm, thereby earning farmland
assessment for that parcel and cutting his tax bill. He sells some
trees now through his church and through non-profits to which he gives
his time as a volunteer, and gives a portion of sale proceeds back to
the charities. By the time he retires, he plans to sell about 200
trees a year. He has also begun to raise chickens for their eggs. (He
also keeps guinea pigs, but solely "for comic relief.") He and his
family eat fruit from their trees and turn tomatoes from their garden
into pasta sauce.
The Duran agricultural enterprises do not cut the family's grocery
bill all that much, he admits, but he says that he enjoys the feeling
of being able to do something for himself. "It's the same thing that
drives people to can preserves," says Duran. "It's a little more of
your life that is under your control."