Connect Ecobee3 thermostat - no c wire but c terminal occupied

Question

I am trying to install a new Ecobee3 wi-fi thermostat to replace my old mercury thermostat. When I pull off old thermostat there are only 4 wires (red, white, yellow, green and a blue tied around). When I look at my furnace there are same 4 wires, plus two additional red and white wires (white is occupying com 24v and red is on Y terminal). Those two wires appear to be running outside to my A/C unit. I do have power extender kit that Ecobee supplies, but unsure which wire goes where or how to fix easily since there is no C wire running to thermostat. thanks for your help.]2

Answer 1

Connect the blue wire from the thermostat cable, to the C terminal in the furnace. Then connect the blue with at the thermostat, to the C terminal of the new thermostat.