Dan's Papers - May 9, 2008 - Eco-Friendly Solutions Keep More Green in Your Wallet

Making your home more eco-friendly might reduce your carbon footprint and help the environment, but there is another area where you can see the benefit of going green - your wallet.

Though a green home might cost more up front, money is saved through lower operating costs. Energy-efficient appliances, geothermal heat pumps, solar power panels, more efficient insulation - these can all help you realize enormous savings on your heating, water and electricity bills. But while these appliances can save you money on your bills, even more savings can come from the financial incentives offered by the federal and state governments, which offer a variety of tax rebates for creating a green home. These rebates help to encourage the installation of such energy saving systems.

Federal tax credits are available for qualified solar water heating and photovoltaic systems (solar panels) installed between Jan. 1, 2006 and Dec. 31, 2008, for 30% of the cost of the system, up to $2,000.

The Energy Policy Act of 2005, which expired at the end of 2007 will likely be renewed this year. Home builders whose homes achieve 50% energy savings for heating and cooling according to the guidelines of the 2004 International Energy Conservation Code (IECC), are eligible for a $2,000 tax credit. There is also a $1,000 tax credit allotted for those who build a home that saves 30% in heating and cooling, as well as those who meet the requirements set by the bill for the Energy Star program. Homes built between Jan. 1, 2006 and Dec. 31, 2008 are eligible.

There are also a number of incentives for homeowners, set by the same legislation. For installing an exterior or storm window that better contains heat or cool air can earn a homeowner a tax credit of up to 10% of the installation cost, up to $200 for all windows installed. Exterior and storm doors that meet the guidelines can earn you 10% on up to $500 of installation costs.

Replacing your regular roof with a metal one, which is an excellent insulator, can earn you a 10% credit on up to $500, as can putting in better and additional insulation, so that it meets the requirements of the IECC. Meanwhile, installing energy-efficient central air conditioning, air source heat pumps, geo-thermal heat pumps and water heaters can earn you a tax credit of $300.

The biggest rebate comes for solar energy systems. For a solar water heating system, where at least half of a home's energy must come from the sun, can bring in a rebate of 30% of the cost of installing it, up to $2,000. A home with solar panels is eligible for the same tax credit. New York State offers up to $5,000 for such installations.

Also at the state level, New York's Assisted Home Performance Program grants low-income homeowners up to 50% of the cost for energy efficient improvements, including refrigerators, heat pumps, washers/dryers, dishwashers and more. Single-family homeowners must meet income eligibility guidelines to qualify the grants of up to $5,000.

The State also provides incentives for small wind energy systems, with a base incentive of $4,000 for a tower at least 80 feet high. It also offers between $3 and $5 per watt for the installation of solar panels, with residential systems capped at 10kw.

The Long Island Power Authority also offers a Residential Energy Efficiency Rebate Program, including $250-600 for split central air conditioning or air source heat pumps, $200-1000 for geothermal heat pumps and $3.50 per kW, with a cap of 10kW, for homes utilizing solar panels.

For more information and to find out how to file for these and other tax rebates and incentives, go to nyserda.org or dsireusa.org.