Renewable Energy Incentives for Home Owners from the State of Texas?

By Vernon Trollinger, August 16, 2010, Energy Efficiency, FAQs, News, Save Money

Are There Renewable Energy Incentives for Home Owners from the State of Texas?

The short answer unfortunately is no. According to the State Energy Conservation Office (SECO):

“…the state does not have a program at this time that provides funding of renewable energy equipment on an individual basis, there are tax exemptions available in certain instances. For example businesses that either use or manufacture or install solar or wind energy can receive franchise tax deductions and/or exemptions. There also exists a property tax exemption involving solar, wind, biomass, and anaerobic digestion for business installation or construction of such systems.
Texas residents can also check with their local utility providers, as some have energy efficiency programs that offer low cost loans/rebates and advice on renewable energy technologies.”

Basically, the program is designed to be simple and beneficial for all parties involved. Independent contractors agree with the participating customer to do projects that promote energy efficiency and utility agrees to pay the contractor a price established by the Public Utility Commission of Texas (PUCT).  The utilities themselves do not perform any energy efficiency services or installation of energy efficient projects.  Instead, they contract with contractors to be Project Sponsors, as required by state legislation. The agreements between the electric utility and the project sponsors(energy efficiency service providers) consist of standard non-negotiable terms. The programs are based on templates approved by the PUCT.

Different utilities offer rebates or loans for mostly similar energy improvements.  For example, Oncor and CenterPoint offer energy audits, assistance programs covering Energy Star program for new home and older Homes, high performance air conditioning, and others.  It is up to the homeowner, though, to chose an approved Energy Efficiency Service provider (or “sponsors” or contractors) and then work with them and their utility to make sure the work is done properly.

Oncor’s energy efficiency programs are available at Take A Load Off Texas.

CenterPoint has info here about their energy efficiency programs.

American Electric Power Company (AEP), Texas has information about their residential energy efficiency programs here.

Meanwhile, SECO does list other federal programs encouraging energy efficiency.

One program skipped by SECO is new Property-Assessed Clean Energy (PACE) program .    The program is approved on a state-by-state basis.  Texas is one of 22 states to adopt it.  Cities implement the plan by issuing bonds to cover the up-front costs.  Basically, the plan says that a homeowner can get a loan on their property from their city in order to improve the energy efficiency.  Payments are made through higher property taxes.  The plan runs into problems, though, with Federal Mortgage financiers, Fannie Mae and Freddie Mac.  At issue is whether the PACE loan gets priority of payback over the mortgage when the house is sold. Remember, the PACE loan is paid back as a tax lien.

Edward J. DeMarco, Acting Director of the Federal Housing Finance Agency (FHFA) directed Fannie Mae and Freddie Mac not to purchase mortgages with PACE lien on them, saying “Mortgage holders should not be forced to absorb new credit risks after they have already purchased or guaranteed a mortgage.”

Both Fannie and Freddie have now been sued by the State of California.

And here you thought energy efficiency programs weren’t controversial.  ;>)
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Comments (1)


  1. JoeyQ. says:

    I really wish that they would have these energy saving incentives in Texas and in all other states as well. It would help in a lot of different ways. There are also so many things that people could do with the money that they save. I think that it could even boost the economy a little bit. I also believe that people could pay off homes faster and get lower mortgage rates .