Home Performance on the Move

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FenEx
Posts: 353
Joined: Fri Mar 11, 2005 3:43 pm
Location: Illinois

Home Performance on the Move

#1 Post by FenEx »

As many of you are aware, the 2005 Energy bill allows for tax credits on windows ($200) and other energy saving improvements up to $500 total. Bulders are however able to recieve a $2,000 credit for Tested and Certified new homes that meet the Home Performance criteria. The problem with the homeowner incentives are that they are too low to make a huge impact and they are material cost based- not performance based. There are already circumstances where individuals are buying products (for the receipt) and either returning them or installing them improperly, thus negating the goal of the bill as they are not saving energy.

I am proud to say that several of the organizations I am affiliated with are aggressively addressing these issues with congress.

Snowe-Feinstein - "A bill to amend the Internal Revenue Code to Improve and Extend Certain Energy-related Tax Provisions". Other supporters include Hilary Clinton and John Kerry.
Among provision of this legislation is:

Extension of the new homes credit through the year 2010
A performance based tax credit to improve the efficiency of existing homes. This proposed tax credit is based on a sliding scale depending on the percentage of energy savings. The credit ranges from $800 for 20% savings to $2,000 for 50% savings. The procedures for third-party certification parallel those currently used for the new homes tax credit enacted in EPAct 2005. The incentives begin on date of enactment and expire on December 31st, 2010. The credit applies both to owner-occupied homes and to renter-initiated retrofits. The proposed legislation states that the certification shall be "based on the Residential Energy Services Network (RESNET) Technical Guidelines on the date of the enactment of this section."

I strongly believe that making home improvements Performance Based and requiring certified verification is the only way to reach the goals. The bogus energy saving pledges and claims often used in the window industry will soon be a thing of the past. I believe homeowners will embrace this as they will not only get a larger sum as a tax credit (dollar for dollar), but they will "actually" have their energy savings % verified- No more relying on guesswork from contractors and sales pitches. I think this is a great way for the government to "Raise the Bar" for construction industry professionals. As an accredited Home Performance contractor and a multi certified energy rater, I am delighted as this will provide the incentive necessary for homeowners and contractors alike to gain a better understanding of building science.

Fenex

riddlewh
Posts: 35
Joined: Thu Jul 27, 2006 7:32 am

#2 Post by riddlewh »

Who will measure the performance gain? An energy auditor? An additional cost now for installing windows. Not to mention how will they address low and fixed income people? These people typically can't afford replacing windows, adding insulation, etc., so we give them handouts to buy for their heating bills instead of a handlut to address the root cause.

Sean B.
Posts: 3
Joined: Tue Aug 01, 2006 8:53 pm
Location: Schenectady NY

#3 Post by Sean B. »

riddlewh wrote:Who will measure the performance gain? An energy auditor? An additional cost now for installing windows. Not to mention how will they address low and fixed income people? These people typically can't afford replacing windows, adding insulation, etc., so we give them handouts to buy for their heating bills instead of a handlut to address the root cause.
I would think something like that would/could be based on ratings from industry based organizations. In the case of windows & doors, they could go by the NFRC ratings... the lower the U-Factor, the better the tax break rather than just the "energy star" guideline currently in use for the tax breaks for windows & doors.

As for low & fixed income... there ARE programs... some federal, and some which vary by state, which assist low income homeowners in home energy upgrades. You just have to search it out at various government websites.

FenEx
Posts: 353
Joined: Fri Mar 11, 2005 3:43 pm
Location: Illinois

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#4 Post by FenEx »

Riddlewh
Yes, a certified auditor will have to test the house and create performance reports, before and after. You would not be forced to have the testing done, you could simply replace your windows, but without the tax credit. If the government is going to issue an energy savings tax credit... it needs to do just that... actually save energy. Installing efficient windows and/or insulation is only measureably effective when they are proven to be the "Root Causes". Many homeowners today spend 10, 20, even 30k having their windows replaced or some additional fluff blown into their attic only to find out that their energy savings is less than 10%.

It appears you would object to this bill. I don't understand why. If one were to invest a substantial amount of money into windows, and received a very small amount of energy savings, I would think they would be pretty upset. A typical certified audit runs anywhere from $250-$600, but if it tells you where you are losing the energy, it can help you effectively correct the problems. The $800-$2,000 tax credit is actually just a perk as the real value is "knowing" that you will actually save the 20-50% on your future energy bills. These benefits greatly outweigh the audit cost and some companies even absorb the audit fee if you elect to do business with them. Some audits are very basic, and others such as BPI are very comprehensive also including health and safety standards. I can tell you first hand that the latter is very detailed and time consuming and the profit margin is pretty slim even at the higher rates.

Sean
The tax incentives will be performance based and not by industry ratings. The reason for this is that 95% of the construction industry provides products and installations but does not test to see if it made a difference in the actual home or to what degree that difference may be. Energy Star homes being the exception... they must prove it. You are correct about Energy Star windows as the guideline is very vague and there can be a huge difference from one ES to another, but it will depend on how each window performs with the other systems in each home. There really is no short cut to this... building science is based on physics and diagnostic testing, not just stats and calculators. You are also correct that low income homes can receive the audit and some/all of the repairs at no charge or reduced rates through State and Federal Weatherization Programs. As a matter of fact, many charitable and state organizations that used to "Hand-Out" utility bill money are now switching over to offering funds to test and make repairs to homes. This treats the wounds instead of offering pain killers. HUD has recently adopted these procedures for all of their properties.

I see these changes as not only necessary for our country, but extremely beneficial to homeowners. The BIGGEST obstacle anticipated will be from the contractors as it will require more responsibility and education. I say, it's about freakin' time. Virtually every highly respected profession requires discipline, committment and education (including continuing education). You cant buy a house through a realtor that isn't properly trained, licensed and current but you can have a new house built from a contractor or home builder whose license is nothing more than a filled out form and an annual payment? Lot's of work to be done to correct this.

riddlewh
Posts: 35
Joined: Thu Jul 27, 2006 7:32 am

Re: Reply

#5 Post by riddlewh »

FenEx wrote:It appears you would object to this bill. I don't understand why.
I never said any such thing. However my general knowledge of how the government works always makes me asks questions and to follow the money.

What needs to happen is with low income people is the energy audit happens by default when they request money for heatng bills. No paperwork on their part beyond what they did for heating assistance. Once qualified for that the government does the energy audit, figures out what if anything needs to be done, then does it. Requiring additional paperwork means it won't happen as the government is already giving them the money for heating so what do they care about trying to be efficient?

FenEx
Posts: 353
Joined: Fri Mar 11, 2005 3:43 pm
Location: Illinois

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#6 Post by FenEx »

Riddlewh: "What needs to happen is with low income people is the energy audit happens by default when they request money for heatng bills. No paperwork on their part beyond what they did for heating assistance. Once qualified for that the government does the energy audit, figures out what if anything needs to be done, then does it. Requiring additional paperwork means it won't happen as the government is already giving them the money for heating so what do they care about trying to be efficient?"

You just described the Weatherization Programs that are already available in many states. New York for example, responds to each call for assistance with an audit and $3,500 worth of repairs to improve the energy efficiency of the home. This may not sound like much but you would be suprised what $3,500 worth of air-sealing, insulation, etc., at key areas can do to reduce utility bills while increasing comfort and improving air quality.

riddlewh
Posts: 35
Joined: Thu Jul 27, 2006 7:32 am

Re: Reply

#7 Post by riddlewh »

FenEx wrote:You just described the Weatherization Programs that are already available in many states.
It is Federal money that often goes to paying home heating bills, so the effort for this needs to come from Federal government. Otherwise it is my opinion we are just pissing money away.

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