The Energy Tax Credit: Is it Worth It? Part 4

By Vernon Trollinger, August 3, 2009, Energy Efficiency, Green, Save Money

Conclusion –Becoming Energy Self-Sufficient
There is a higher tier for energy efficiency some homeowners might be interested in. These complex yet more costly improvements will receive a credit of 30% of their total cost but have until 2016 to be placed in service.  They lead not only to greater energy efficiency but to significant cost reductions and energy independence:

Geothermal heat pumps are similar to conventional heat-pump systems with the exception that they use the ground instead of outside air to produce heating, air conditioning, and even hot water.  By relying on the warmth of the Earth's stable ground temperature, they are one of the most efficient HVAC technologies available.

Solar water heaters have many different configurations but all involve passing water through a glass-topped heavily-insulated reservoir (either a tank or a tubing) and letting the sun heat it up.  Some configurations can heat water on a cloudy day or when temperatures even reach –40° F.

Solar panels or photovoltaics (PV) directly convert sunshine into electricity.  These are the same kind of technology that has been around since the Apollo missions to the moon in the early 1970s. Many homes in Europe have solar panels mounted on the southern aspect of their roofs to produce electricity for the home.  Some big-box stores in the US have huge roof arrays that power most of the building.  Though the components are expensive, the technology is evolving quickly and becoming more affordable.

Residential fuel cells combine hydrogen fuel and oxygen from the air in a electrochemical device to produce electricity, heat, and water. Operating without combustion, and therefore virtually pollution free, the fuel is converted to electricity.  Fuel cells produce electricity more efficiently from the same amount of fuel than internal combustion-type generators.  They have no moving parts to wear out and are quiet.  Heat released by the system can be used to make hot water for home use.  This gives them an energy efficiency rating of 80%.  Propane-fueled versions have been shown to work in cold climates such as Alaska.

Small wind turbines generate electricity by wind power.  Available in a range of sizes ("nameplate capacity") from 1 kilowatt ones mounted on your roof or chimney (about $7,000) all the way up to 100 kilowatt turbines mounted on their own tower (about $80,000). 

There is also an energy tax credit for cars:

Hybrids purchased or placed into service after December 31, 2005 may be eligible for a federal income tax credit of up to $3,400. There is a 60,000 vehicle limit per manufacturer before a phase-out period begins. Toyota and Honda have already been phased out. Credit is still available for Ford, GM and Nissan.

Effective January 1, 2009.  The first 250,000 Plug-in hybrid electric vehicles sold get the full tax credit, $2,500–$7,500.  Like the hybrid vehicle tax credits, there is a 60,000 vehicle limit per manufacturer before a phase-out period begins.

So, to put it bluntly: Yes, the Energy Tax Credit is worth it because an energy efficiency improvement will save energy and money and make your home more comfortable.  As you can see there are many, many ways to capitalize on energy efficiency improvements to your home; from the weekend with a caulking gun to a four week wind turbine adventure with a 60 foot crane.  However, you know your circumstances and finances best.  You'll need to decide what you can do yourself and what you need a professional to do.  So, get informed.  The Energy Star website has wealth of information as well as links to other government websites with information about all the improvements mentioned here.  Remember: These are all improvements that keep saving you money each year.  Some can be improved on further, one step at a time.

You might even become so energy efficient you'll be energy self-sufficient.

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