Energy Efficiency Improvements Can Save You Tax Dollars

For my clients in their first home in 2015, this year will be the first time that many will be able to write off expenses such as closing costs, job related moving expenses and mortgage interest. Also, anyone who owns a home also gets a benefit from being earth-friendly. You can receive a tax credit for many energy efficiency improvement expenses that you had in 2015. According to Turbotax, here’s what can and can’t be claimed:

You can claim:
Solar water heating costs
Solar electric costs
Fuel cell property costs
Small wind energy property costs
Geothermal heat pump property costs
Qualified central air conditioners
Certain advanced main air circulating fans
Exterior doors, exterior windows and skylights
Metal or asphalt roofs with qualified coatings
Insulation material or system to reduce heat loss
Certain electric heat pump water heaters, electric heat pumps
Furnaces and hot water boilers powered by natural gas, propane or oil

 

You can’t claim:
Energy Star appliances
Low-flow showerheads
Low-flush toilets

 

The Residential Energy Credits for 2015 are:

  • The nonbusiness energy property credit
  • The residential property credit.

 

If you use less than 80% of an energy efficient item for personal (not business) purposes, you can claim the personal use portion of the costs to determine the credits.

Example: John’s business usage of the doors and windows he installed is 82%. He can claim only 18% of the cost of these items when determining his credit.

If you received a subsidy from a public utility company for your energy-efficient purchase, remember to reduce the subsidy amount from the purchase price before you claim it. If you include the subsidy in your income, you don’t have to make this adjustment.

The residential energy efficient property credit equals 30% of what you spend on qualifying property such as solar electric systems, solar hot water heaters, geothermal heat pumps, wind turbines, and fuel cell property. These credits are claimed on Form 5695. Here’s a bit more information on this credit provided by Turbotax.

  • Generally, labor costs are included when calculating this credit. Also, no cap exists on the amount of credit available except in the case of fuel cell property. Qualified fuel cell property is limited to $500 for each one-half kilowatt of capacity of the property.
  • Not all energy-efficient improvements qualify for these tax credits. For that reason, you should check the manufacturer’s tax credit certification statement before purchasing or installing any of these improvements. The certification statement can usually be found on the manufacturer’s website or with the product packaging.
  • The IRS cautions that the manufacturer’s certification is different from the Department of Energy’s Energy Star label, and not all Energy Star labeled products qualify for the tax credits.
  • If you’re eligible, you can claim both of the residential energy credits. Because these are credits, not deductions, they increase a taxpayer’s refund or reduce the tax he or she owes.
  • Keep in mind, these are not refundable credits, which means you can take the credit up to the tax owed. There is no refund of any credit amount left over.
  • Further information on these credits can be obtained in IRS Form 5695. This form and more information can also be obtained through IRS.gov. You should also consult with your accountant for tax advice.

What is Sustainable?

What is sustainable/sustainability?

We hear the words ‘sustainable’ and ‘sustainability’ almost every day. But I find many people have questions about those terms. Is it about people and culture, our environment, or jobs and money? Is it about green homes, smart cities and energy planning? Is it about patronage to local business owners that care about and invest in your community? Is it about you and me or is it something for other people to worry about?

Sustainability is actually about all of these things and more. Everything that we need for our survival and well-being depends, either directly or indirectly, on our natural environment. Sustainability maintains the conditions under which humans and nature can exist in productive harmony, permitting fulfilling the social and economic needs of present and future generations.

It’s a big idea to get your head around. It’s really about thinking about where your food, clothes, energy and all of your products and service comes from and deciding whether you should buy and consume these things. For example, you can buy timber imported from anywhere in the world. But do you know enough about the laws of foreign countries about the prevention of animal harm during the lumbering process? Do you have information about whether the local indigenous people support the harvesting, how much they get paid, or if their process depletes the soil so much that future harvesting will be impossible?

If an activity is said to be sustainable, it should be able to continue forever. It can be applied to almost anything from how we eat to how we create products and services. For example, a food company that creates food that is harmful to their consumers will eventually lose its consumers through sickness or the lack of income due to the lost productivity of sick consumers. The production of harmful food is not sustainable as a sound business model. However, if the case is that all consumers are completely in the dark, then there is a high rate of replacing those consumers indefinitely.

Some people say it is easy to recognize activities that are unsustainable because we know it when we see it. Think of the extinction of some species of animals, often due to the activities of humans. Or salinity (salt quantity) in our rivers due to changed land management practices. And at home, the amount of packaging you put in the trash that has to go into our overfilled landfills. Another example of unsustainable practices is real estate development that does not meet the needs of local populations. Eventually, people will vote with their pocketbooks and it will not be economically feasible for developers to make profits on homes and condos that don’t reflect a sustainable mindset; these properties are not energy efficient, they are too expensive to maintain, or their materials and designs do not contribute to the healthy lifestyles and social interactions that many consumers want today.

The Green Living area of the EPA website has more on this topic and you can drill down to your specific community here: Visit the Green Living area of the EPA website.

To meet others interested in sustainability join our Sustainable Social Club.

Resources: www.landlearnnsw.org.au/sustainability/what-is-sustainability; http://www.epa.gov/sustainability/basicinfo.htm

Has the Cost of Keeping Your Home Cool Got You Overheated?

The experts at Home Depot will keep your cooling units running more efficiently while helping to keep the cost of staying cool down.

  • Change or clean your filters regularly, doing so takes the stress off your  cooling units motor and extends its lifetime.
  • Use shades, blinds and or drapes to keep out hot afternoon sun.
  • Have your cooling unit maintained at least once a year to keep it running at its best.
  • Keep your thermostat at 78 degrees and if possible install a programmable thermostat.
  • Make sure your window unit is the correct size for the size of the area you are trying to cool. A unit that is too small will not cool your room and a unit that is too big will push your cooling costs through the roof!
  • Ceiling fans help to keep cool air from your air conditioner circulated and ultimately reduces energy costs.

Here is a handy chart to help you choose the right size ceiling fan:

Image

 

Source: http://ext.homedepot.com/community/blog/cool-it-down-tips-for-cooling-your-home-efficiently-home-depot-blog/

http://www.homedepot.com/webapp/catalog/servlet/ContentView?pn=Ceiling_Fan_White&langId=-1&storeId=10051&catalogId=10053

Green Map Planned for Stamford – Please Complete the Survey

The Stamford Land Use Bureau is currently working on a Green Map and applying best practices for developing content. A green map is essential to linking and defining our community. It will not only identify green companies and walks, but also businesses and organizations that contribute to the place-making and community engagement essential for thriving cities. The team needs your input via their web survey.

Click the link to the Green Map webpage: http://www.cityofstamford.org/content/25/50/105109/122882.aspx

The links to each part of the survey are located on the bottom of the page and each part must be completed. Thanks.

Investing in Solar Energy has Unexpected Returns – By Patricia Rattray

What do you really know about solar energy? The new applications of solar are worth investigating if you want to improve your quality of life. Your return on investment might include surprising financial and familial benefits.

Consider the home of a Kevin Porter and his family. They are residents of Easton CT, that decided to install a solar energy system in his 2500 sf colonial home. They recognized the financial benefits right away, and dramatically decreased their electricity bill by 65% in the first two months of use.

The Porter family was also eager to experience the obvious environmental benefits, which was an instant decrease in his family’s contribution to the emission of harmful co2 gases. Over a 30 year period, his family’s contribution to the reduction in these emissions is equivalent to the ecological benefit of planting 473 trees.

Kevin’s excitement about the solar experience is infectious. His solar panels are aesthetically pleasing, mounted seamlessly on the back of his house. From a distance, it looks like a solid piece of tinted glass lying elegantly on his rooftop. He chose to install Sunpower panels, made by a German company that he respected. In fact, these are the most efficient panels currently manufactured. Then, he called Sunlight Solar, a Sunpower panel installer, and had a professional and educational experience that propelled him forward.

The installation was fairly simple compared to the benefits that Kevin and his family derived. Sun Power Solar completed a two phased assessment approach and was able to install the system in just a few days. They also helped him secure the applicable state and federal rebates and credits to offset his cost.

A solar installation includes solar panels, an invertor box and a meter, similar to your current eclectic meter. Once installed, Kevin could keep track of energy generated and used, and also how much unused energy was going back into the grid and available to other households. In Connecticut, households can get credit for this unused energy from the electric company. Kevin was also eligible for a state rebate that can cover approximately 50% of the installation cost. A 5040 watt system comprised of twenty-four 210 watt solar panels would cost approximately $44,000. There are also state specific programs that provide low interest loans to finance the installation, as long as you meet an income qualification. (Note: Since this article was written, cost and rebates might have changed. Consult your state web site for up-to-date information.)

Other benefits can impact your family and your finances as well:

The financial and environmental benefits of solar use are obvious, but other benefits were soon realized. Kevin’s wife and kids became more aware and interested in impacting their home energy use and understanding energy sources and issues. The inverter box displays how much energy is generated by the sun and used by the home 24 hours a day. The family started talking about how much energy their rooftop was generating, and how much energy their family was using and saving each day.

This awareness motivated them to find other ways to save energy. One way is skipping the clothes dryer and making a small investment in a portable, collapsible clothesline, that can be put away when not in use. They also use rain water (grey water) collected in a 75 gallon barrel to water their garden, and are investigating a soaker hose to minimize wasting water while watering. The family also has begun to compost and use non-toxic, natural pest repellents, such as a Cayenne hot pepper spray in their vegetable garden. These self grown vegetables are yet another way to minimize household expenses. Inside the home, a wood burning stove installed with insulation around the flute helps reduce their heating bill.

Increased property values can also be a benefit of energy saving activities, according to a recent study by the Appraisal Group. The study was conducted by ICF Consulting with funding from the Environmental Protection Agency and it confirmed energy efficiency improvements do result in higher home values.

[1]Homeowners can profit by investing in energy efficiency, even if they don’t know how long they will be staying in the home. “If their reduction in monthly fuel bills exceeds the after-tax mortgage interest paid to finance energy efficiency investments, then they will enjoy positive cash flow for as long as they live in their home, and can also expect to recover their investment in energy efficiency when they sell their home.”

Knowledge of new investment opportunities and the capabilities of eco-friendly manufacturers was another benefit of Kevin’s solar energy installation experience. By taking the initiative to research solar panels, Kevin learned about solar manufacturers. Since Kevin is a financial planner, he is now advising his clients to invest in the most promising clean energy and green companies. Such companies develop energy saving products, clean energy resources, and recycling processes and equipment.

The benefits of solar energy use are worth exploring. Whether your objectives are financial, environmental or moral, the outcomes might far exceed your expectations. You might save money, decrease harmful CO2 emission, increase your property value, get first-hand knowledge of green investments, and also create a home in which you truly understand your energy use and your impact upon the earth.  At the most basic level, a new understanding of energy use in your home is a priceless return on investment.


[1] Web Site: Energy Checkup web site May 19th, 2008  http://www.energycheckup.com/content/IncreaseHomeValue.asp

City of Stamford Green Plans as of July 2008

Greenhouse gas emissions, which are major contributors to global warming, are caused by a variety of sources:  there are millions of cars, boilers, and light bulbs contributing to our emissions.  We must all work together to fight global warming and degradation of the environment.  On October 17, 2007, Mayor Malloy issued an environmental proclamation “Stamford Cool & Green 2020,” featuring a multi-faceted approach to the climate challenge.  In addition to ongoing energy efficiency programs, the City will substantially expand its efforts, ultimately making Stamford the leading environmental steward in Connecticut.  Following are some of the initiatives listed in the proclamation:
  • Creation of an Energy Improvement District to promote the development of combined heat and power generation and renewable power.
  • Construction of two large scale solar systems on the roof of the Rippowam Middle School and Highway Department Facilities – funded by $2 million in Clean Renewable Energy Bonds.
  • Require LEED standards for private buildings.  Site plans to be LEED certifiable by 2011.  Reduce building fees by 10% for LEED silver, 20% for LEED gold, and 25% for LEED platinum.
  • Green Lights Program – encourage residents to replace traditional light bulbs with compact fluorescent bulbs.  The City plans to supply 5,000 free bulbs to its residents.
  • Tax relief for citizens who purchase hybrid cars.  Reduce the assessed value of a hybrid vehicle by $2,000.  This will result in a $68 reduction in car tax.
  • Encourage residents to sign up for clean energy through their electric bill to support electricity generated by alternative energy sources.  The goal is for Stamford to be number one in the State for enrollment and thereby the Cleanest & Greenest energy city in the State.
  • Conversion of 20% of the City car fleet to hybrids, alternative fuels, or high fuel efficiency vehicles within five years.
  • Increase solid waste recycling to 40% by 2010 by recycling of plastics numbered 3-7, more frequent electronics recycling, and broadening our composting system.
  • Develop a list of the “top 10” green items or services that are routinely purchased by the City and implement a policy to ensure that the green items chosen are purchased, such as cleaners, computers, vehicle fleets, office electronics and paint.  To-date the City has purchased nine hybrid vehicles for its municipal fleet.

The Stamford Cool & Green 2020 proclamation builds upon the success of city efforts since 1998.  We have implemented over 50 energy efficiency projects within municipal facilities, saving over $2.4 million in cumulative energy costs and receiving over $2 million in utility rebates.  On an annual basis this has resulted in a reduction of over 5,000 tons of greenhouse gas emissions (CO2).

We shed 1.5 megawatts of power over eight facilities when called upon by the electric grid operator – which is another resource that helps to defer or eliminate the need for power plant construction. 

We installed the first municipal solar system in Connecticut in 2004 and sell kilowatt-hours back to the grid.  We purchased our own street lights from the local utility company and are actively implementing reduced wattages and newer lighting technologies.   

We have created a Mayor’s Sustainable Stamford Task force, made up of residents, representatives from businesses, educational and religious institutions, and city staff.  

We have positioned ourselves as an environmental leader and we will continue to mitigate our impact on climate change.