June 1st, 2009
Funds from the Obama Administration’s American Recovery and Reinvestment Act economic stimulus package are finally beginning to make their way to green projects near you. Aside from the expanded tax credits that we’ve highlighted previously, it’s often tough to figure out how you as a home owner/renter can benefit from the confusing maze of funding sources.
One of the key funnels for money to local green projects is the Energy Efficiency and Conservation Block Grants program. Under the EECBG, the Department of Energy will distribute over $2.7 billion to local governments across the country. All cities/towns with over 50,000 residents are eligible, and most will receive several hundred thousand dollars or more (click here to see how much your town is receiving). Towns smaller than that can still receive funds, but must apply for them through their state energy office.
How can this program benefit you as a resident of an EECBG recipient? It’s up to local government officials to determine how the local grants can be used, but many eligible activities could funnel resources directly to individual homeowners or local neighborhoods, including:
- Incentives for residential energy audits;
- Local energy efficiency financial incentives (rebates, financing assistance, etc);
- Funds to reduce transportation emissions by supporting employee flex time programs, bike lanes, rideshare commuting programs, etc.
Others that might impact your daily life include retrofits of traffic and street lights, changes in building codes to promote energy efficiency, and new incentives to promote recycling and use of recycled content products. You can find the entire list of efforts promoted by the EECBG program here.
The trick, as with any government funding program, is to make sure that your local officials structure the program in a way that benefits you and your fellow residents (vs. special interests who are also clamoring for these funds). The best way to do that is to contact your local government officials, and in particular anyone associated with energy or greening initiatives, and to make sure that your voice is heard. Applications by cities are due to the DOE on June 25th, and cities have to submit an Energy Efficiency and Conservation Strategy document that lays out their plans for the money within 120 days of application. Many cities will submit the EECS before that, so start advocating for your favorite programs now!
Popularity: 4% [?]
March 2nd, 2009
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: 6% [?]
January 26th, 2009
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: 5% [?]
January 23rd, 2009
It’s pretty clear that we’re in uncharted economic waters these days. Unemployment numbers just get worse and worse, stock portfolios continue to tank, and companies formerly at the pinnacle of the US economy flirt with bankruptcy.
At Low Impact Living, we have a pretty strong view into how small green businesses are doing out there, and it isn’t pretty. Part of that has to do with the housing market. New green homes aren’t getting built. Major remodels that often occur when people are prepping their homes for sale or have just purchased a new one are few and far between. And even medium-sized projects are hard to fund due to the evaporation of home equity.
But there’s another disturbing driver that’s starting to rear its ugly head: the shutdown of major green infrastructure projects by governments across the country.
California often leads the way when it comes to major green investments, with CA voters funding billions in bond measures over the past ten years for environmental projects. In mid-December, all of that came to a screeching halt: construction projects across the state were put on indefinite hold to the detriment of the environment. Multi-million dollar projects ranging from urban stormwater treatment to watershed restoration to dam removal are affected, as are the jobs and ecosystems that depend on them. (disclaimer: I’m involved with several projects that were affected).
In New York, the governor’s proposed budget for the next fiscal year cuts off all state funding for zoos, botanical gardens and aquariums. In addition to protecting threatened and endangered species, these facilities often serve as the only open and green space for residents of urban areas. Check out the Wildlife Conservation Society’s funny but poignant plea below:
In Florida, the legislature has proposed suspending the $300M / year Florida Forever program, which is used to fund the acquisition and protection of natural lands throughout the state. Also on the chopping block: $10M per year to clean up the state’s waterways.
And in Colorado, the governor recommended cutting Colorado’s Solar Incentive Program rebates in half and making major cuts to the state’s wastewater and drinking water facilities inspection and groundwater monitoring programs.
I’m sure that you have examples from governments big and small near you (and if you do, please share them via comments below!). The consequences of these cuts are pretty clear: lost jobs, lost open space, and a dirtier environment. Let’s hope that President Obama’s stimulus plan ends up filling these gaps before even more damage is done.
Popularity: 15% [?]