March 2nd, 2009
More Money In Your Pocket From Obama Stimulus Plan
Stumble it!
We’ve already written several pieces about the benefits of President Obama’s economic stimulus plan for homeowners looking to go green, but there are some pretty important wrinkles that we haven’t highlighted that could really save you some significant money.
If you’re looking to make a major new green home improvement, here are some items you definitely want to keep in mind:
- Solar Hot Water Heaters. The NEW credit removes a $2,000 limit on the credit you could receive for a new system, so larger solar hot water systems will be eligible for the full 30% tax credit.The previous tax credit cap of $2,000 meant that you wouldn’t get any additional help if your solar hot water system cost more than $6,667, which many do. To qualify, the solar hot water system must provide at least 50% of your home’s hot water, and it can’t be used for heating pools.
- Solar Photovoltaic Systems. As with a solar hot water system, the NEW tax credit removes the previous $2,000 maximum benefit cap. You now get 30% of the cost as a credit regardless of the total amount. Because solar PV systems are so expensive, this is a MAJOR new benefit.
- Geothermal Heat Pumps. We’ve written about geothermal heat pumps before - they’re among the most efficient ways to heat or cool our homes, but they’re very expensive. The new stimulus package gives you a 30% credit with no upper cap for installing one, as long as it is an Energy Star version. As with solar PV systems, this can mean thousands of dollars for you. Previously, the credit was for 30% but was capped at $2,000.
- Cool Roofs. Cool roofs can save major money if you live in a climate where air conditioning bills dominate your utility spending. Now, you can get up to a $1,500 tax credit (30% of the intallation cost) for a cool roof, whereas the previous amounts were only 10% of the cost with a maximum of $300. To count, it needs to be an Energy Star qualified roofing product.
- Residential Wind Energy Systems. Today there are more options for residential wind turbines than ever before. Now, you can get up to 30% of the cost back as a tax credit with no cap on the total amount. This isn’t as much of a benefit as in other categories, for the previous maximum credit amount for small wind systems was $4,000. To get any added benefit, you’ll have to spend at least $13,300, which is a pretty large turbine on your property!
- High Efficiency Hot Water Heaters. The new tax credit is for 30% of the installation cost up to $1,500. However, the new unit must have an energy factor of at least 0.82, which rules out even the new Energy Star storage hot water heaters. All new Energy Star tankless hot water heaters will qualify, as will some very high efficiency storage versions (such as the AO Smith Vertex).
As with anything tax-related, you need to consult with your accountant before assuming any of these credits are “in the bank.” Some important caveats to note:
- The credits are for improvements made in 2009/10, with the exception of geothermal heat pumps, solar HW/PV, and wind turbines (2009 - 2016).
- The cool roof and standard hot water heater credits are NOT standalone - you get up to $1,500 for ALL of your energy efficiency improvements together, which includes windows, insulation and the other more typical upgrades we’ve written about previously. The other credits we’ve discussed above (solar HW/PV, geothermal, wind energy) are standalone credits and do not count towards the $1,500 energy efficiency cap.
- Only the solar HW/PV, geothermal heat pump, and wind energy system credits can be claimed by folks building new homes. There’s another set of incentives for typical energy efficiency measures in new home construction that flows through contractors.
For more information on all of these programs, please visit Energy Star’s great tax credit summary.
Looking to start a project? Check out Low Impact Living’s directories of solar installers, green plumbers, geothermal heat pump installers, wind power installers or energy auditors / green home consultants to get a quote near you.
Popularity: 8% [?]
January 26th, 2009
Update on Green Aspects of President Obama’s Stimulus Package
Details are finally emerging on how President Obama’s stimulus program intersects with energy efficiency and green building. The House of Representatives recently published a draft of the plan (shown here), and there’s significant money allocated to green initiatives. Depending on how you slice it, at least $50 billion will go to green-related programs. Some of the highlights include the following:
- $11.0 billion to fund the development of a “smart” electrical grid;
- $7.9 billion in energy-related grants to states;
- $6.2 billion in subsidies to low-income households for energy audits and weatherization;
- $2.5 billion to demonstrate the feasibility of carbon capture and storage technologies;
- $2.0 billion to fund research and development into advanced batteries, biomass fuels ($0.8B+) and geothermal technologies ($0.4B+);
- $1.0 billion to guarantee loans to develop advanced batteries;
- $0.5 billion to fund water reclamation and reuse projects.
The good news is that, all in all, these projects should go a long way towards jumpstarting a low-carbon economy.
The bad news? At first glance, there’s not a huge amount here that will directly benefit individual consumers and homeowners looking to green their homes. The $6.2 billion in weatherization funds will help, but that only applies to a subset of the population:
- It applies to households that are at or below 200% of the poverty level. For a family of four, that works out to be somewhere in the neighborhood of $44,000 per year of income.
- The funds don’t flow directly to the family, but instead from the Federal Government down to the states and then directly to weatherization agencies (who can be either local government or nonprofit organizations). These organizations provide services to about 60,000 homes a year, so this program will have to grow by 20-30x in order to meet President Obama’s goal of weatherizing 2,000,000 homes. It’s hard to see that happening quickly unless private sector service providers are brought into the program.
States have some flexibility to customize their programs, so we hope that the range of families and service providers involved is larger than this. And, there’s always hope that the states will broaden the reach of the stimulus package depending on how they spend their slice of the $7.9 billion allocated to state grant programs. Those details, though, have yet to be worked out.
We’ll keep you posted, of course, as things develop!
Popularity: 6% [?]
January 9th, 2009
Obama Stimulus Package Good News for Green Folk
In case you missed it yesterday, President-Elect Obama laid out his economic stimulus package plans– and there was plenty of good news for us green folk. Green leaders around the country are applauding the plan. Quoted in Grist, League of Conservation Voters President Gene Karpinski said, “This morning, President-elect Obama reaffirmed his commitment to invest in efficiency and clean energy technologies as part of his economic recovery package. [He is] ready to hit the ground running, he offered specific details that offer great hope for America’s future success.”
To read more laudatory comments from environmental leaders, visit Grist here.
To read the full text of the speech, click here.
In the speech Obama called for radically increasing the use of clean, renewable energy–both in government buildings and in private homes. He said, “To finally spark the creation of a clean energy economy, we will double the production of alternative energy in the next three years. We will modernize more than 75 percent of federal buildings and improve the energy efficiency of 2 million American homes, saving consumers and taxpayers billions on our energy bills.”
That is music to our ears. As my Low Impact Living co-founder, Jason Pelletier, wrote earlier this week, we now have an outstanding opportunity for the government to drive private and public adoption and use of renewable energy and other eco-smart technologies. And as President Obama seems to understand, driving that adoption is also an excellent way to create new jobs for Americans.
Now let’s all pray that he can get this plan signed and get the green train to leave the station!
You can see a draft of the full plan here.
Popularity: 4% [?]
