How Does Energy Efficiency Relate to Renewable Energy?

Jack, While efficiency is alive and well -- the U.S. must do more -- and fast, to meet the challenges of global climate change, increased energy imports and national security. Recent studies (see links below) show we can cut our greenhouse gas emissions in half by using energy efficiency first, but it needs to be followed by an aggressive utilization of renewable energy. The President issued an Executive Order in January 2007, which set goals for federal agencies, such as to improve energy efficiency and reduce greenhouse gas emissions of the agency, through reduction of energy intensity by (i) 3 percent annually through the end of fiscal year 2015, or (ii) 30 percent by the end of fiscal year 2015, relative to the baseline of the agency's energy use in fiscal year 2003. Congress, not to be outdone, passed efficiency credits including for solar water heating and photovoltaics. Tax credits are available for qualified solar water heating and photovoltaic systems are available for systems "placed in service" from January 1, 2006 through December 31, 2008. The tax credit is for 30 percent of the cost of the system, up to $2,000. This credit is not limited to the $500 home improvement cap. For energy efficiency for homeowners (I am not going to cover automobiles, etc., or companies in this Q&A): -- Windows & Doors, which includes Exterior Windows and Skylights, must be Energy Star qualified OR meets IECC1. The tax credit is 10 percent of cost, up to $200 for all windows, skylights and storm windows. All Energy Star labeled windows and skylights qualify for tax credit. Note that Installation costs are not included, and for tax purposes, save your receipt and either the Energy Star label from all your new windows or the Manufacturer's Certification. -- On Roofing and Metal Roofs that are Energy Star qualified, consumers will receive a tax credit of up to 10 percent of cost, up to $500. The roof must be expected to last five years or have a two-year warranty. Note: Installation costs are not included, and for tax purposes, save your receipt and the Manufacturer's Certification Statement. -- For Insulation that meets 2000 IECC & Amendments, consumers save 10 percent of cost, up to $500. For insulation to qualify, its primary purpose must be to insulate. (example: vapor retarders are covered, siding does not qualify). Insulation must be expected to last five years or have a two-year warranty, and installation costs are not included. For tax purposes, save your receipt and the Manufacturer's Certification Statement. -- Central Air-conditioning units must have EER >=12.5/SEER >= 15 and Split Systems must have EER >= 12/SEER >= 14, and consumers can receive a $300 tax credit. For a list of qualified products, go to the Consortium for Energy Efficiency product directory, click on the Air Conditioners and in the "CEE Tier" enter "Residential Tier 2." Note -- not all Energy Star products will qualify for the tax credit. For tax purposes, save your receipt and the Manufacturer's Certification Statement. -- Geothermal Heat Pumps are under the same criteria as Energy Star: EER >= 14.1 COP >= 3.3 Closed Loop, EER >= 16.2 COP >= 3.6 Open Loop, EER >= 15 COP >= 3.5 Direct Expansion $300. All Energy Star labeled geothermal heat pumps qualify for the tax credit. For tax purposes, save your receipt and the Manufacturer's Certification Statement. Also, for your energy efficiency tax credits, you must file IRS Form 5695. The best reports on energy efficiency come from three nonprofits: Alliance to Save Energy, American Council for an Energy Efficient Economy and the Rocky Mountain Institute. But my two favorite recent efficiency studies show we can cut our greenhouse gas emissions in half by using energy efficiency first, followed by an aggressive utilization of renewable energy. The first report is from the European Renewable Energy Council (EREC) and Greenpeace and it is called "Energy Revolution: A Sustainable World Energy Outlook" (use first link below). The other study, "Tackling Climate Change in the U.S. -- Potential U.S. Carbon Emissions Reductions from Renewable Energy and Energy Efficiency by 2030," is from The American Solar Energy Society (ASES) (use second link below). So Jack, I couldn't agree with you more -- and while much is happening, much more could be done. -- Scott Sklar