Category — tax credits and rebates

Dear Mr. Energy,

I want to know how to make my home Energy Star so I can get credit for my utility company. Do I get an energy audit? My house is only about ten years old. Because it’s fairly new shouldn’t my house easily qualify?

–Bargain Shopping in Benson

Dear Bargain,

Isn’t it great that some local utilities are giving rebates, credits, and lower rates for homes that have achieved a high level of energy efficiency? Mr. Energy sure thinks so, and he thinks that when the new, more stringent Energy Star guidelines for homes go into full effect in 2012 it will be even more meaningful goal. The new Energy Star guidelines will require that homes be more than 20% effiecient than code-built homes; the current guidelines look for a 15% improvement.

That said, dear reader, your home will not qualify. That’s because Energy Star for homes is only for new construction.

I will repeat: Energy Star is only for new construction.

Mr. Energy said it twice because he gets many calls from people just like you: people who are excited at the possibility of making their homes more energy efficient and saving money and who don’t understand that in order for a home to get an Energy Star rating a HERS rater – the professional who can rate a home Energy Star – must be involved from the get-go. The rater has to see the plans and make site visits every step of the way. An already existing home, no matter how efficiently constructed, simply will not qualify.

Very sorry to be the bearer of bad news.

The only way existing construction could ever qualify for Energy Star is if a homeowner were renovating his or her home so thoroughly it was being taken down to the studs. Which I doubt you want to do simply to get a percentage off of your monthly electric bills.

To answer the second part of your question, about new construction automatically being energy-efficient construction, Mr. Energy has this to say: maybe? It really depends on your builder, your house’s plans, and the various contractors your builder used. Mr. Energy hopes that your builder and HVAC company and insulation contractor had the highest level of energy efficiency in mind when they worked on your home, but new doesn’t always equal energy efficient. Mr. Energy has been in a number of homes built in the past 10 years that have been extremely energy inefficient – either because the builder didn’t know any better or because he or she didn’t care. The only way to know for sure if your home’s level of energy efficiency is to get a professional energy audit.

Here’s the good news in all of this: if you get an audit and weatherize your home according to your auditor’s suggestions, you will be saving energy and money anyway – just without the Energy Star label and without the automatic discount from your utility.

A while ago I wrote a post outlining Progress Energy’s rebates for energy efficiency projects. It’s one of the most popular posts on this blog, and I wanted to make sure that everyone reading this knows that while I wrote that post in January, the rebates offered through PE are still going on.

The way that Progress Energy’s rebates relate to Home Performance NC, our company, is that as certified PE contractors, we can apply the $60 duct-testing rebate towards our comprehensive energy audit. If you have 2 units the rebate will be $90. For a full audit that works out to 20 – 30% off the total price of the audit. If we discover that your ducts need sealing in the course of the audit, duct sealing will also qualify you for a rebate  - up to $120, or half the price of the repairs. And if it’s also determined that you’ll need your attic sealed, you can also get a generous rebate for that as well – $ .0375/sq. foot.

Nice.

For full details on the Progress Energy rebates, click here.

And to make an appointment for an energy audit, please e-mail us or give us a call: (919)360-1570. We happily travel throughout the greater Triangle area for our audits and weatherization services.

Dear Mr. Energy,

What’s this I hear about Cash for Caulkers?  I know you’re probably excited about it, because it will mean business for you, but what does it do for me? Seems like the government is just throwing money down the drain.

–Disgruntled in Durham

Dear Disgruntled,

My, my, sounds like someone has low blood sugar. No need to be so upset! Cash for Caulkers, or Home Star, or HR 5019, or S 3177, will be very beneficial to consumers, if it passes. While it will definitely benefit companies like Mr. Energy’s – after all, we conduct energy audits and are a full service weatherization company, which is exactly the kind of business that will be able to add employees and expand once the program hits — it equally benefits everyone who pays an energy bill .

Basically, Cash for Caulkers is designed to stimulate consumer demand for exactly what Mr. Energy is always telling you about: energy audits and weatherization. It will do this by offering direct rebates to consumers for qualifying home improvements. There will be two types of incentive: a “silver star” program, where consumers get rebates for things like air sealing, insulation, duct sealing or replacement, insulation, energy efficient appliances and windows, and a “gold star” level, which is a plan more tailored to individual houses, and includes a comprehensive energy audit that lays out a plan of action. People who achieve “gold star” are going for overall increased energy efficiency, and the financial incentives are greater as long as the homeowner increases his/her home’s energy efficiency by up to 20%, with additional incentives for greater increase.

Here’s why this is fantastic news for consumers: Mr. Energy has already told you how an energy audit and subsequent weatherization pays for itself in just a few years. This will make it pay for itself much quicker! A super-fast return on your investment.

 As for the government, Mr. Energy makes it a policy to stay out politics, at least publicly. It is not his job to run the country, thank goodness! Bottom line: Mr. Energy thinks this is a worthwhile piece of legislation. He will be able to hire more workers  and help everyone in the greater Triangle area save energy and money. And you, sir , can be one of them.

Here’s a super-simplified made-for-CNN version of how Cash for Caulkers will work, if/when/once it’s passed into law (sorry, commercial first…then video):

What I like about the video is the end, where the homeowners say that they’ve calculated their payback and it’ll be sooner rather than later. This is a very important point to make – yes, you have to spend money to get an audit and weatherize your home – but you will get paid back by saving energy and money over time. Not next week. Not next month. In  most cases, not even next year. But two years out? Possibly. Three years? Definitely.

What our weatherization crew chief likes best about the video is the crawl space the company in the clip is working on. It’s rare that he hangs out in crawl spaces here in central North Carolina that are that high! Maybe it’s because many of the houses we work on are older…but he’s a little envious of a crawl space in which those workers are standing upright.

I’ve written a bit about Cash for Caulkers, or the HomeStar program before, and am waiting to write much more before it’s voted on in Congress. Suffice it to say that when HomeStar hits, Home Performance NC is well prepared to help you make your home more energy efficient. We are BPI Analysts, RESNET-HERs raters, and a full-service weatherization company, and as such can help you achieve the silver star /prescriptive path or the gold star/performance path – whichever you choose to pursue.  At Home Performance NC we believe  know that an energy audit and subsequent weatherization will pay for itself – many times over the period of only a couple years. Home Star will help this payback happen much faster, which is always a very good thing.

The Home Star Coalition has an excellent fact sheet outlining the proposed HomeStar bill, if you want all the details.

This is the weekend for the NC Appliance rebate, and if you want to take advantage of 15% off a replacement Energy Star appliance you should do it ASAP. Like right now. Like this morning! News from the trenches (i.e. when we went to our local big box hardware store to buy a new replacement washer) is that yesterday (Thursday) at 2 p.m. 25% of the rebate money had already been applied for. We predict that by Saturday morning it will all be gone.

We bought a Bosch front-loading Energy Star washer to replace our old, less energy efficient washer that dates back to 1994. Our old washer will be missed – it was our first joint purchase as a couple and washed a ton of clothes for us, including our children’s baby clothes, diapers, and 40,000 mud-stained little boy socks. But our new washer will cost us lots less per year to run – largely because the newer washers get a lot more water out of wet clothing before you put them in the dryer. The dryer, which is the real energy hog when it comes to getting clothes clean, has to work a lot less.

The only thing I’m not thrilled about in the appliance rebate is that to get the rebate we have to turn in our old washer. I know the point is to get the old “clunkers” off the street, but our washer (a Maytag) has been problem-free for 16 years. I bet a family that couldn’t afford a brand-new washer would get a lot of use out of it. And if they hung their clothes on the line instead of using a dryer, it really wouldn’t impact energy use that much. I would love to donate the washer to our local Habitat for Humanity Home Store instead of sending it off to be destroyed…

Dear Mr. Energy,

What will give me the best return on my money: replacing my single-pane windows with double-pane low-e windows, replacing my traditional hot water heater with a solar hot water heater, or sealing my attic and adding more insulation?

–Perplexed in Pittsboro

Dear Perplexed,

Mr. Energy loves a no-brainer. For, neighbor friend, this is one of the easiest questions he’s had in a long time. Of these three possible home improvements the answer is obvious: seal your attic and add insulation. The reason it’s so obvious is in the math – sealing your attic and adding insulation is the cheapest fix of these three (even if you add in the cost of a home energy audit to help you pinpoint your air leaks) and will garner you the most in energy savings over time. The return on your investment is high.

The other two options will absolutely save you money and energy in the long run, but they cost a lot more, which means a much longer pay-off. We’re talking decades (even with tax credits and energy company rebates) as opposed to just a year or two for the attic sealing and insulation combo.

Your question has allowed me to get on my soapbox. Please indulge me for a moment. Here it is: companies that install windows or solar hot water heaters have done a marvelous job convincing the public that the best things homeowners can do is to buy their products. Marvelous.

It is absolutely true that new windows are more energy-efficient than old, and solar hot water heaters do save money when compared to the costs of heating water using traditional hot water heaters. But – dear readers – do not believe any company that promises a pay-off in a few short years for these two items. Do the math yourself. Base it on your own energy bills, energy use, and actual cost of installation.  Once you do this you’ll realize that if your goal is to save the most energy for the least cost, there are more immediate and cost-effective solutions.

I wish I could tell you that Cash for Caulkers was going to be retroactive from the beginning of this year, or even last year. I wish that the plan was a little further along in the process and we knew more details. This would help homeowners make decisions about what they can do now, and it would help us here at Home Performance NC know the best move to make to help out people living in central NC. We are hoping that it will be a retroactive plan, at least to the beginning of this year. Several blog posts on various energy efficiency/”green” blogs have suggested as much. 

In any case, if it *is* going to be retroactive from the beginning of the year then I suggest that anyone who wants part of the action contact a BPI analyst for an energy audit appointment as soon as you can. We’ve heard through the BPI newsletter that BPI professionals will be the ones performing “quality assurance testing,” which only makes sense to us. This means a complete, professional energy audit, including test in, to determine the problems in your home, then a test-out, to determine whether the work that was done will yield result.

We predict that energy auditors are going to become pretty busy in the next couple of months. This is great news for us, but for you – the homeowner – it means you’ll need to plan ahead. We don’t know how long Cash for Caulkers will go on, but people will need to plan several months ahead in order to get the audit and the work done, especially in a competitive environment. 

If you’re interested in an energy audit by a BPI analyst, please contact us at Home Performance NC. Mark, our lead auditor, is BPI certified, and has a bunch of other certifications and verifications to his name – in other words, he’s thoroughly qualified to do an audit on your home. He is happy to travel anywhere in central NC to do an audit – we’re located in Pittsboro, but he’s traveled to Lexington, Rougemont, Greensboro, North Raleigh – anywhere within a couple of hours of our home in central North Carolina – to do an audit. He’d also consider traveling further if he was doing more than one audit over a period of several days. E-mail: mark@homeperformancenc.com ; phone: 919 360-1570.

Here is the link to the fact sheet presented by the White House on Cash for Caulkers. Finally!

We’ve been waiting for this for a while. We are still interested to find out exactly how this will all go down, but the basics of the program (cut and pasted directly from the fact sheet) seem pretty good:

Rebates delivered directly to consumers: Like the Cash for Clunkers program, consumers would be eligible for direct HOMESTAR rebates at the point of sale for a variety of energy-saving investments in their homes. A broad array of vendors, from small independent building material dealers, large national home improvement chains, energy efficiency installation professionals and utility energy efficiency programs (including rural utilities) would market the rebates, provide them directly to consumers and then be reimbursed by the federal government.

$1,000 – $1,500 Silver Star Rebates: Consumers looking to have simple upgrades performed in their homes would be eligible for 50% rebates up to $1,000 – $1,500 for doing any of a straightforward set of upgrades, including: insulation, duct sealing, water heaters, HVAC units, windows, roofing and doors. Under Silver Star, consumers can chose a combination of upgrades for rebates up to a maximum of $3,000 per home. Rebates would be limited to the most energy efficient categories of upgrades—focusing on products made primarily in the United States and installed by certified contractors.

$3000 Gold Star Rebates: Consumers interested in more comprehensive energy retrofits would be eligible for a $3,000 rebate for a whole home energy audit and subsequent retrofit tailored to achieve a 20% energy savings in their homes. Consumers could receive additional rebate amounts for energy savings in excess of 20%. Gold Star would build on existing whole home retrofit programs, like EPA’s successful Home Performance with Energy Star program.

Oversight to Ensure Quality Installations: The program would require that contractors be certified to perform efficiency installations. Independent quality assurance providers would conduct field audits after work is completed to ensure proper installation so consumers receive energy savings from their upgrades. States would oversee the implementation of quality assurance to ensure that the program was moving the industry toward more robust standards and comprehensive energy retrofit practices.

Support for financing: The program would include support to State and local governments to provide financing options for consumers seeking to make efficiency investments in their homes. This will help ensure that consumers can afford to make these investments.

It’ll be interesting to see what’s required of already certified, licensed BPI analysts and HERs Raters. Hopefully not much more than what they’ve already done. A national standard exists – there’s no need to reinvent the wheel.
No matter what you think about Obama, the stimulus program, or government spending, there’s no doubt that this program has massive potential for companies like ours. If this goes into effect anytime in the next couple of months by the years’ end we could see tripling or quadrupling our workforce, for sure. Good for us and good for potential employees. Especially good for homeowners who want to make long-term changes in their homes’ energy efficiency!

Up until now we’ve been telling you that an energy audit and subsequent weatherization will pay for itself in 2-3 years. We have years of data from Energy Star and the Low Income Weatherization program to back this up. But now it’s time to give you real examples of ways that our clients have saved and will save money from applying the results of an energy audit to make their homes more energy efficient.

Real world example #1: Joe Suburban Homeowner Guy from Cary

The client in this first example owns a 3200 square foot home in one of the most densely populated suburbs of Raleigh, built in the 90s. It’s one of many in a neighborhood of homes built at the same time. These homes were not built to Energy Star standards and probably went up very quickly. It’s unclear if one builder built all of them or if a number of builders participated in this subdivision.  If you live in the greater Raleigh area you know that there are many neighborhoods like this in Cary, Apex, North Raleigh, Wake Forest, Holly Springs, and other suburban pockets.

We did a comprehensive home energy audit and were also contracted for follow-up weatherization. This customer’s energy company is Progress Energy, so he qualified for the duct testing and duct sealing rebate.

One of our suggestions for weatherization was to seal the home’s HVAC ducts. We did some other weatherization as well, but for this case study I want to focus on the duct testing and sealing.

Here’s what the homeowner paid for the audit + duct sealing, minus the rebates from Progress Energy:

$570

Plus, he’ll also get a $30 tax credit from the federal government. 

We calculate that his heating and cooling costs were $2600/year.

When we tested his HVAC ducts we found that they had 26% leakage. That’s right – 26%. What this means is that 26% of the heated or cooled air wasn’t reaching the house.  Every time the heat pump kicked in – either to heat or cool the home – only 3/4 of what should have been going in was going in.

Unacceptable, right?

Believe it or not, most homeowners experience 20-30% leakage in their home’s HVAC ductwork, and some research even puts it as high as 43%. So our homeowner, at 26%, was experiencing average energy loss through his ducts. But who wants to be average? Especially when it comes to wasting energy!

After sealing this homeowner’s ductwork, we re-tested his ducts for leakiness and found that we’d reduced the leakage to 4%. 74% capacity to 96% capacity. Not perfect, but darn close.

From his ducts alone, he should save, very conservatively, at least 10% on his  energy bills. We’ve looked at many reports that state duct testing/sealing can save more like %20-%30 on heating and cooling costs. 

We estimate that with the money this homeowner will save in energy costs from his HVAC system alone he will have a 100% return on his investment in the audit and the duct sealing within two years. This doesn’t count the other energy efficiency work that we did on the home, and it’s using today’s energy costs. If rates go up, the return on his investment will be even faster.

Finally, it’s worth pointing out that we’re using the savings on the duct work to calculate the pay back for the price of the entire audit – an audit that pointed out many other ways the homeowner could save money. 

A win-win for the homeowner, no?

In my last post I focused on Progress Energy’s rebates for duct testing, which can be applied towards a full energy audit done by one of their approved contractors, like us. This post will outline how Progress Energy helps its Carolina customers follow up an energy audit with weatherization to improve a home’s energy efficiency.

Basically, PE provides rebates for weatherization in the areas of duct sealing (covered in the last post), air sealing, and insulation. They will also help homeowners replace their heat/AC systems if you replace them with high efficiency systems. And finally, they offer rebates on window replacement. We don’t happen to think that replacing your windows is the best way to use energy efficiency dollars, but in case you disagree with us or have other compelling reasons to change our your windows please take advantage of this rebate.

Here are the details on PE’s rebates for air sealing and insulation:

They will give you a rebate of $.375/sq. ft for air sealing your attic and improving your insulation levels up to $375, if…

• You are improving your insulation from less than R-19 and going up to at least R-30. (For more information then you’ve ever wanted to know about “R” values and what they mean, please go to this website).
• AND you have a centrally ducted Heat/AC system
• AND you have the work done by someone on their contractor list (and YES, we are on that list, too)
• AND you are a Progress Energy customer.

That last one seems a little dumb to have to add, since we are talking about Progress Energy, but I guess they get enough non-customers asking for their rebates that they had to put that in the description.

Anyway, this is a really, really great deal for homeowners. But here’s the kicker: do not, I repeat, DO NOT do the easy thing and just hire an insulation contractor to dump a bunch of insulation on top of what you already have. No sirree! Be sure to have your audit first so you can show your contractor where you have leaks in your attic, then SEAL THE ATTIC (!!), then add the insulation.

Seriously. Dumping more insulation on top of an unsealed attic is like…I can’t think of a good analogy right now – but it’s not a smart thing to do. Sealing the attic is the #1 most important thing in this whole equation.

Seal it. First, have an audit (and get your rebate for duct testing). Then seal your attic…then, and only then, increase your insulation.

Please.