Legislation provides 30 percent tax credit to make homes energy efficient
Nov 18 2011
Washington—U.S. Senators Dianne Feinstein (D-Calif.), Olympia Snowe (R-Maine) and Jeff Bingaman (D-N.M.) introduced legislation today to cut Americans’ energy bills, catalyze the construction industry, reduce pollution and secure the nation’s energy future.
The Cut Energy Bills at Home Act provides a 30 percent tax credit for Americans to reduce their energy consumption and costs by making their homes energy efficient.
“By offering incentives for energy efficient renovations, this bill helps create jobs in California’s ailing construction sector while at the same time decreasing energy use and pollution,” said Senator Feinstein. “This sort of investment—putting Americans back to work while leaving behind lasting improvements—is the type of legislation Congress should be spending more time on.”
“During these challenging economic times, we must ensure energy costs for Mainers and Americans are not prohibitive,” said Senator Snowe. “This legislation provides a 30 percent tax credit up to $5,000 to assist homeowners who make an investment into energy efficiency and reduce energy consumption and costs. At a time of finite federal dollars we must prioritize tax policies towards the most cost-effective method to secure our energy future. Performance-based energy efficiency can transform America’s homes. I commend Senators Bingaman and Feinstein for their longtime leadership on energy efficiency, and look forward to working with our colleagues in Congress to address this vital issue.”
“This new tax credit rewards homeowners for reducing the amount of energy they use,” said Senator Bingaman. “It’s an incentive that encourages homeowners to choose the most sensible and inexpensive option for saving energy. And, by helping lower energy use, this tax credit also will help reduce unhealthy air pollution and greenhouse gas emissions.”
“Efficiency First applauds Senators Snowe, Bingaman, and Feinstein’s introduction of the first home performance tax credit. This legislation is a monumental step forward for both homeowners and the home performance industry. By providing financial incentives for real energy savings, the 25E tax credit will save energy, save money, and create jobs. This is a real and sustainable growth opportunity for our industry and real savings for the American homeowner. This is a win-win-win for America,” said Greg Thomas, the CEO of Performance Systems Development and Chairman of Efficiency First.
The Cut Energy Bills at Home Act:
- Provides a performance based tax credit for residential whole-home energy consumption. The value of the credit begins at $2,000 for a 20 percent reduction in the energy consumption of a residential home for heating, cooling, water heating, and permanent lighting. The credit increases by $500 for every additional 5 percentage point increase in energy savings, up to $5,000. The credit is capped at 30% of the cost of the improvements and expires at the end of 2014.
- Defines how to calculate energy savings using computer modeling calibrated to actual energy bills before the improvements.
- Sets requirements for the contractor, installation process, and the modeling software to ensure work quality. It also requires the Secretary of Treasury in consultation with the Secretary of Energy develop taxpayer documentation regulations for what the taxpayer needs to keep on file for documentation purposes.