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EPACT Tax Credits forAppliances and HVAC –Program Implications2006 National Symposium on Market TransformationMarch 21, 2006Glenn ReedVermont Energy Investment Corporation
Two Different Types of Tax Credits Manufacturer Tax Credits for Appliances Refrigerators, dishwashers, clothes washers US production only Consumer Tax Credits for “Qualified Energy Property” Furnaces, boilers, water heaters, CAC/HPs, furnace fans,GSHPs Taxpayer’s principal residence IRS Notice 2006-26 (2/21/06) provided details Specified need for Manufacturer Certification Statement
Appliances - Manufacturer Perspective Potential interest driven by multiple factors: Tax credit availability New ENERGY STAR specs New CEE Tiers Limited timeframe to respond – many can’t/won’t retool for atwo-year creditSome “most” efficient units produced offshore – not eligible Some production moving to USManufacturers have engaged some regions
Appliances - Program Administrator Perspective Appliance efforts are receiving less attention in many regions Delay in new ENERGY STAR specs – CW & DWMany programs not aligned with 2007 CW spec Shrinking savings increments, even for most efficient units High market share for units at current ENERGY STAR specs Lack of a longer-term strategic vision to transform markets Lighting is King – fewer dollars to appliances However, some regions are actively promoting most efficientunits within the ENERGY STAR umbrella Tentative discussions with manufacturers NEEA goal of 50% of CWs at 1.80 MEF or above by 2007
NW Alliance Promotion
Appliance Opportunity? Can ENERGY STAR play a more active role inbrokering discussions between manufacturersand PAs? Current 2006 ENERGY STAR Appliance plan doesn’texplicitly address this opportunity
HVAC – Manufacturer Activities Some early interest in leveraging credits Goodman/Amana furnace ads in trade publicationsand promotion on website Others are planning – promotional flyers underdevelopment
GoodmanAd
HVAC – Manufacturer Challenges Eligible product identification GAMA has developed directories for: Furnaces Furnace fans DHW – gas instantaneous ARI is meeting later this month ARI-CEE Product Directory?– EPACT HP requirement is at 13.0 EER, not 12.5
HVAC – Manufacturer Challenges How to provide Manufacturer Certification Statement?“Consumers and contractors are screaming fordocumentation” Website – e.g., Goodman furnaces and furnace fans Problems w/third party coil combos Lack of consumer access Contractor leave behind ARI-CEE Product Directory ARI meeting later this month
HVAC – Program AdministratorPerspective CAC/HP Focus moving from equipment to installationpractices – QIV New Federal standard, new ENERGY STAR spec, lesssavings Limited HP availabilityCEE Tier 2 and EPACT requirement not aligned Limited number of public benefits gas efficiency programs Most programs promoting 90 or 92% AFUE Limited product availability at 95% AFUE Some interest in water heaters and furnace fans, e.g.,GasNetworks – information, possible joint promotions
Contact infoGlenn ReedVermont Energy Investment Corporationgreed@veic.org781-646-1505, x203
HVAC - Program Administrator Perspective CAC/HP Focus moving from equipment to installation practices - QIV New Federal standard, new ENERGY STAR spec, less savings Limited HP availability CEE Tier 2 and EPACT requirement not aligned Limited number of public benefits gas efficiency programs Most programs promoting 90 or 92% AFUE Limited product availability at 95% AFUE
