The tax cut in your attic and walls
Charlie Burr
The most visible efforts to achieve energy security for our region have largely focused on expanding our sources of clean energy like wind, solar, geothermal and wave. But the cheapest, greenest energy in the world is the energy we never use in the first place. In short, increasing energy efficiency is the one of the most cost-effective way to both reduce global warming gas emissions and foster long-term economic growth.
The good news is that aggressive gains in energy efficiency don't rely on new whizbang technology that's unproven or unattainable. We already know a lot of what works. And every year, our understanding of green building technology in particular continues to grow. Despite the very real barriers consumers face, more and more contractors are incorporating best practices into everyday home remodeling projects and urban infill buildings.
My wife and I recently bought an older storefront and former church that we're fixing up for residential use. The place is in a lot worse shape than other places we've renovated. But our approach to efficiency has been relatively straight forward: systematically improve the building's performance by upgrading appliances, insulation, lighting, heating and ventilation.
For heating, we're replacing one of the least efficient systems, baseboard electric, with one of the most efficient, a heat pump with high-efficiency forced air furnace back-up system. We're replacing cracked, single pained windows with new or used low-e windows salvaged from the Rebuilding Center or purchased at a discount from a local retailer. Our 20 year old toilets have now been upgraded to low-flow models from EcoHaus. The energy hog electric water heaters have been replaced with a single on-demand system that only heats water when you need it. It takes about seven seconds or so to kick in, but prevents a constant energy suck that's reflected in our utility bill each month. If your fridge looks like a Pinto, it probably performs like one too. Energy Star appliances mean that we're not really giving up any convenience, we're just getting more bang for our energy buck.
And that's the point. Energy efficiency doesn't mean going without, it just means making smarter use of finite resources. There's more we'd like to do -- solar when we can afford it -- but we're working hard to reduce overall demand first. In doing so, we're not sacrificing comfort, we're just trying to look at a lot of small decisions in a larger context of our home's overall performance.
Northwest homeowners have access to some great resources. By encouraging the development and promotion of energy efficient products and technologies, The Northwest Energy Efficiency Alliance has helped the region achieve saving of 210 aMW, enough energy to power 145,000 homes. The Energy Trust of Oregon offers homeowners free on-site energy audits, including providing folks an action plan to improve efficiency and save costs. And local utilities like PacifiCorp, PGE and others working through the Energy Trust offer incentives for weatherization, heating, appliances and lighting, water heating and renewable energy.There's a lot of low-cost, high-impact improvements that can save money while protecting our environment.
Some folks I know who bought their homes at the height of the housing bubble are now upside down on their mortgages. It's a terrible place to be. There's no silver bullet to get us out of this mess, but improving home energy performance can save folks money every month on their bills. For families facing one of the most difficult financial landscapes in memory, a few modest upgrades can make a big difference. And for local contractors facing tough times, working on cost-effective energy efficiency upgrades provides good jobs while helping our region's long-term energy security.
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Feb 25, '09
I would love to replace the inefficient windows in my house. Obama's stimulus package boosts the tax credit for efficient windows to 30% of the purchase price!
But my taxable income is low enough that I don't have any federal tax liability. Is this tax credit refundable, or am I stuck with the full cost of the windows (which I probably can't afford at full price)? Does anyone here know?
This points to a limitation in using non-refundable tax credits to deliver stimulus benefits - the benefits end up being targeted at folks earning enough money to have a federal income tax liability.
1:14 p.m.
Feb 25, '09
Robin, there are also state incentives available through Energy Trust. If you contact folks at EcoTech LLC for example, they can walk you through state tax benefits and other low-interest finance options. Sustainable Solutions Unlimited is another good resource. As mentioned in the post, the Rebuilding Center also sells many low-e windows that builders don't use. We just bought a new low-e window there for about $27, but it took a while to find one that fit. Obviously, that price doesn't include installation.
1:43 p.m.
Feb 25, '09
Charlie, do you just throw your garbage down into the pews before having a Thanksgiving dinner that can't be beat? :)
I really wanted to see a bigger weatherization push in the stimulus for just the reasons Charlie cites, but I guess I'm glad it's in there at all.
1:58 p.m.
Feb 25, '09
I would have liked to see more weatherization too, but there's a lot more we can and should do in Oregon to keep things rolling. I'll post more later.
And sadly, no pews intact at Chez Burr.
4:36 p.m.
Feb 25, '09
On-demand water heaters should be required in all new gas or propane served homes. They are great. You not only don't heat water when you are not using it, but you never run out of hot water either.
Feb 25, '09
And yet little to nothing is being done for renter-occupied housing, where renters neither have the ability to afford these improvements, nor have the clout to force the owners to do. And these homes are frequently the most expensive to heat and cool.
I speak of this as a customer service rep for a electric utility, and of course as a renter.
These are the folks that I hear from that have $200/month heating bills and can't pay them. All of the tax breaks, the incentives, the rebates...does ZERO for these folks who are most in need of these measures.
And yet the Democrats in power are...conveniently ignorant of the plight of their citizenry. I would expect this kind of behavior from the Republicans where the "well if you rent, that's your problem, you can earn more money if you want" mentality persists.
IMO, if the powers-that-be truly want to force energy efficiency, it should force owners of renter-occupied housing to make improvements, and also a law that caps electric bills of renters (where the owner is responsible for anything above the cap)...or at least at a minimum the owners MUST clearly disclose average monthly usage for the last ten years at a given site and the cost as a mandated disclosure, along with an average for a similiar sized dwelling with like HVAC systems.
Feb 26, '09
Erik:
Another Erik implemented a series of efficiency programs and requirements of apartment owners in the City of Portland. Plus landlords are eligible for many incentives and do have to meet new code for any changes to their facilities. That said, there are a few cheap changes that can have great impacts even renters can apply. Get your own CFLs and take them with you when you move. Plastic over windows can cut down on your gas costs a bunch, and can be done for 10s of dollars.
Of course we could try and force efficiency improvements, I'm sure there is probably some mechanism to do this out there. But maybe a requirement that all contracts provide utlitiy cost data could help renters anticipate costs, and compare the real costs of rents.
Feb 26, '09
Great points about options and resources for renters - we offer a checklist of things renters can do to reduce their energy use, links to weatherization resources and a flyer for renters to use in making the case for energy smart improvements to their landlords, all on our Web site at www.energytrust.org/renters.
Mar 1, '09
Erik and Peter,
The problem with "split incentives", where renters don't want to invest in making their landlord's property more efficient, and landlords don't give a rap because they don't pay the utilities, could be cured in a couple of ways.
(1) legislate that all rental properties must meet current energy code before title is transferrable, and allow tenants option to petition landlords to make specific improvements, principal & interest for which is paid off through "on bill financing" (such things are cash flow positive to tenants, for efficiency measures that pay for themselves quickly, and help tenant to lower their total payment, while helping to landlord bring property up to code), or
(2) Make it illegal to rent anything except on the basis that at least 50% of utility bills are paid by landlord, so both tenant & landlord have incentives to be efficient.
There's a bill (HB 2181) that would allow property owners to make efficiency improvements and add P&I of financing for improvements to their property tax bill. However, that does nothing for tenants of residential or commercial properties.
HB 2181 should be modified to allow for on-bill public financing of efficiency improvements by tenants, with the bill to follow whoever occupies the property.