Bill offers home insulation retrofits
An Energy Efficiency and Sustainable Technology law will provide $15 million in loans in the next 2 years
 
By David Steves – The Register-Guard – August 3, 2009

How would you like to be able to add insulation that keeps your house cooler in the summer and warmer in the winter — and then pay for it with the money you could end up saving on your utility bill over the next 20 years?

It may sound too good to be true, but it’s just what new state legislation promises to deliver.

The new Energy Efficiency and Sustainable Technology bill, signed into law in Eugene by Gov. Ted Kulongoski, will provide $15 million in loans over the next two years to Oregon homeowners. Unlike conventional home improvement loans, the money can be repaid with utility bills.

The bill’s authors, including Rep. Chris Edwards, D-Eugene, say they fully expect that the reduced energy usage — and lower utility bills — will provide consumers with enough savings to pay back the loans.

Edwards was part of a bipartisan group of House members who came up with the bill and worked it through the 2009 session. It is now awaiting Oregon Department of Energy rule-making so it can be tested in a few areas.

Eugene is one of five places in Oregon to express interest in piloting the program. If it’s included as a testing area, then Eugene residents could be taking out loans and hiring contractors to retrofit their homes for greater energy efficiency or to add renewable energy components by late this year or early next year, Edwards said.

Edwards became interested in pursuing such a program a couple of years ago, after having an energy audit on his west Eugene home and deciding to add insulation to the walls, replace the front door with one that kept out winter cold and summer heat, and upgrade ductwork that was letting heat from the furnace escape before reaching rooms in the house.

It cost a few thousand dollars. The Edwardses were able to pay for it out of their savings account. But it got the state lawmaker thinking about what other people can and can’t pay for once they learn about energy inefficiencies in their homes.

“I recognized in the process that a lot of people could not afford the up-front cash,” he said. “But if you can spread that out over time, the cost is lower than the amount you’ll save in lower utility bills.”

Under the EEAST program, applicants can get loans up to $40,000, although architect and state Rep. Jules Bailey, D-Portland, said most loans will most likely be for $7,000 or less.

With interest rates of 1 percent or 2 percent, the principal and interest would add $20 to $30 to most monthly utility bills over 15 to 30 years, he said.

The idea, although on Oregon’s law books only a week, has been gaining attention nationally. Bailey said he was peppered with questions about it from other states’ lawmakers at a recent National Conference of State Legislatures convention in Philadelphia.

Last week, U.S. Sen. Jeff Merkley, D-Ore., successfully pushed an amendment on the Senate floor that spells out the U.S. Department of Energy’s authority to offer loan guarantees to energy efficiency retrofit programs patterned after the Oregon EEAST program.

The Eugene Water & Electric Board already offers a no-interest loan program for such upgrades, but borrowers must pay EWEB back in full within five or fewer years, said the utility’s Jason Heuser. That limits the program to those who can afford to pay back several thousand dollars in a few years.

“There might be a demographic out there of people who, because of their monthly income, may be willing to have a 2 percent interest rate if it means they have 15 or 20 years to pay it back,” said Heuser, EWEB’s lobbyist, who worked on the EEAST legislation.

New tax credits: What’s out there?
Energy efficiency upgrades can be pricey, but incentives may cover 40 to 60 percent
By Kate Ramsayer - The Bulletin - April 25, 2009

After a winter of paying high heating bills but still living in a chilly house, Tania Piper and Colin Mahood, of Bend, decided to see what they could do to make their house less drafty.

“I want our house to be efficient; I don’t want to be wasting our money or wasting resources,” Piper said. “So for me, it was obvious that it was something that needed to be a priority.”

They hired a company to do a series of tests to find the home’s problem spots and received a list of improvements that would help make the house more airtight, like adding insulation in the floors and sealing leaks around ducts — work that came with a price tag of more than $2,000. But with federal and state tax credits and power company incentives, that cost was cut by more than half.

And this year, under the federal economic stimulus plan, more federal tax credits are available to homeowners who want to make energy-efficient upgrades.

Piper and Mahood wouldn’t have hired businesses to make the improvements if they didn’t have tax credits or rebates, Piper said.

“It was huge for us to get the tax credits and incentives,” she said.

With the increase in federal tax credits available, as well as the continuing state tax credits and incentive programs from local utilities, it’s a good time for people to consider energy conservation and renewable energy projects, said Lou Torres, a spokesman for the Oregon Department of Energy.

“It becomes very cost-effective all of a sudden,” he said, noting that even with the declining economy, people are still making improvements and applying for the tax credits.

The stimulus bill removed the cap on federal tax credits for installations like solar panels and geothermal heat pumps, so people who put in those systems can get 30 percent of the cost back when they do their federal taxes, Torres said.

And the cap for tax credits for other improvements — like energy-efficient windows and doors, heating, ventilating and air conditioning systems, insulation and more — was set at 30 percent of the cost, up to $1,500.

That’s triple what it previously was, said Kendra Van Note, with GreenSavers USA, a Bend business that conducts home energy audits and helps people determine what they can do to make their homes more efficient.

“This gives people money back in their pocket to do those weatherization upgrades and become more energy efficient,” Van Note said. “The first step to reducing dependence on foreign oil is for all of us to become a little more efficient in our daily lives.”

And when people upgrade their insulation, seal off leaks or install new windows, it not only uses less energy but also can lower the homeowner’s bill.

“If your ducts are severely leaking, 30 percent of your home’s heating and cooling can be lost,” Van Note said. “That’s money literally spewing out of your ducts every month.”

Her company will test a house, using tools like a blower door test to see where the air leaks out of a building or a thermal imaging scan to determine where heat is escaping, she said, adding that the tests cost about $300, on average.

The Energy Trust of Oregon has a list of companies that can perform an energy audit at www.energytrust.org.

Energy officials can then present a homeowner like Piper with a prioritized list of what work should be done, how much it would cost and what incentives or tax credits are available for the work.

Many times, people can get rebates and tax credits worth between 40 and 60 percent of the cost of the improvements, Van Note added.

There are many incentives out there for people, said Randall Marchington, mechanical estimator with Ponderosa Heating & Cooling in Sisters, which also does home performance energy audits.

Pacific Power and Cascade Natural Gas Corp. customers can get incentives from the Energy Trust of Oregon, while Midstate Electric and Central Electric Cooperative have rebates for things like heat pumps.

Ponderosa Heating provided a quote for one homeowner for around $8,000, which was reduced to $3,100 once all incentives and credits were included, Marchington said.

Some homeowners could qualify for financing, he said, and if the rates are good enough, the monthly payments people make for the improvements are offset by the amount of money they now save on energy costs.

“That exact same money you were throwing away is going to pay for your investment,” he said.

The federal stimulus package also set aside funds to improve the energy efficiency and weather-resistance of low-income residents’ homes.

In Central Oregon, NeighborImpact expects to receive about $1.4 million in July for the program, said Colleen Neel, who runs the organization’s weatherization program.

And the threshold for what qualifies as low income has shifted from 150 percent of the federal poverty level to 200 percent, so more people could be eligible for funds, she said.

Neel recommends homeowners call the organization to fill out an application to find out whether they’re eligible for the program.

For Bruce Sullivan, a green building consultant with Earth Advantage in Bend, the stimulus also provides a boost by informing homeowners about some of the different ways they can improve the way their homes consume energy.

“Every little bit will help,” Sullivan said. “It simply attracts people’s attention so they begin to think of these things as viable options.”