Green Energy Incentives Workbook

Green Energy Tax Services

Sustaining Business Growth
with Energy Tax Incentives

Summary of Key Questions to Energy Savings –
General Federal Incentives for Businesses
• Did the taxpayer build or renovate a facility?
• Did the taxpayer design a building for a government entity?
• See Sec.179D, Energy-Efficient Commercial Building
Deduction
• Did the taxpayer invest in alternative energy property to
generate power?
• See Business Energy Investment Tax Credit
• Did the taxpayer own a specified energy property?
• See Payments for Special Energy Property

General Federal Incentives for Businesses (continued)
• Did the taxpayer purchase a qualified alternative vehicle?
• See Alternative Motor Vehicle Credit
• Did the taxpayer purchase or lease a qualifying plug-in
hybrid vehicle?
• See Plug-In Electric Vehicle Credit
• Did the taxpayer install qualified clean-fuel vehicle refueling
property?
• Alternative Refueling Property Credits

General Federal Incentives for Businesses (continued)
• Did the taxpayer have qualified reuse & recycling property?
• See Qualified Reuse & Recycling Property
• Did the taxpayer provide fringe benefits for employees?
• See Fringe Benefits for Employees
• Did the taxpayer qualify for any alternative fuel credits?
• See Alternative Fuel Credit

Federal Incentives for Specific Manufacturers/Developers
• Did the taxpayer produce 190-proof alcohol for use as fuel or
blending into fuel?
• See Alcohol Fuel (Ethanol) Producer Credit
• Did the taxpayer produce qualifying biodiesel & renewable
diesel?
• See Biodiesel & Renewable Diesel Credit
• Did the taxpayer manufacture energy efficient appliances?
• See Energy-Efficient Appliance Credit
• Did the taxpayer construct new homes that meet certain energy
efficiency standards?
• See Energy-Efficient New Homes Credit

Federal Incentives for Energy Industry
• Did the utility company produce and sell electricity from
renewable sources?
• Did the taxpayer produce excess electricity from renewable
sources and sell it back to the grid?
• See Renewable Electricity Production Credit
• Did the utility company invest in a qualified advanced energy
manufacturing project?
• See Qualifying Advanced Energy Project Investment
Credit

Federal Incentives for Individuals
• Did the taxpayer install energy-efficient property?
• See Residential Energy-Efficient Home Improvements
Credit
• See Summary of Tax Credits for Homeowners for
qualifying products
• Does the taxpayer have an energy-efficient property?
• See Residential Energy-Efficient Property Credit
• Did the taxpayer purchase or lease a qualifying plug-in
hybrid vehicle?
• See Plug-In Electric Vehicle Credit

State & Local Incentives for Businesses & Individuals
• Does the taxpayer qualify for any state & local incentives?
• See Appendices A & B for State & Local Incentives for
Businesses & Individuals

General Green Incentives and Credits for Businesses

FEDERAL INCENTIVES

Energy-Efficient Commercial Building Deduction –
Section 179D
Did the taxpayer design a Did the taxpayer build a
NO No Section 179D
building for a government OR new facility or renovate an
entity? existing facility? NO benefit available
Y Y
E E N
S S O
Did the new facility or renovation include
If 50% reduction is NOT met, is energy
installation of interior lighting, HVAC or hot
NO reduced by 20% for lighting,
water systems, and building envelope that
20% for HVAC, or
reduces power use 50% or more?
10% for building envelope?
(compared to reference building)
Y Y
E E
S S
NO Need certification?
Was the project certified? Call Matt Becker at
NO
Y Y
616.802.3413
E E
S S
Potential YES Potential
Was the property placed
$1.80 per square foot $0.60 per square foot
in service before 2014? YES
deduction deduction
(whole building) N N (lighting, HVAC, or envelope)
O O

No Section 179D
benefit available

Business Energy Investment Tax Credit –
Section 48
Did the taxpayer invest in
alternative energy NO
No additional benefit
property to generate power available
for its own use?
Y
E N
S O
Was the property: Is the property: NO
1. Qualified fuel cell? Is the property:
1. Solar property used to
2. Qualified small wind 1. Equipment for producing
generate electricity,
turbines?
NO or distributing
heating/cooling, or solar
3. Solar used to generate geothermal energy?
process heat?
electricity for heating or 2. Qualified micro-turbines
2. Equipment that uses the
cooling or to provide (small combustion)?
ground or ground water
solar process heat? 3. Combined heat and
to heat or cool a
power systems?
Y structure?
E Y Y
S E E
S S
Was the property placed
in service before 2016? Was the property placed
10% credit
Y in service before 2016? YES

E
S
Note that the credit for geothermal property, with the
30% credit exception of geothermal heat pumps, has no stated
(10% for solar after 2016)
expiration date.

Payments for Specified Energy Property in Lieu
of Tax Credits – Section 1603
1. Specified energy property are
depreciable properties that are,
among others, part of an electricity
production facility using wind,
Did the taxpayer own a biomass, geothermal or solar energy,
specified energy No additional benefit or certain power plants using fuel
NO
property? cells or micro-turbines.
available a. Qualified property includes
Y
expansions of an existing
E property that is qualified
N
S property under §45 or § 48 of
O
NO the IRC.
2. For property placed in service in
Was the property placed in If construction of the 2009 or 2010 OR for properties that
service between 1/1/2009 property began between were not placed in service in 2009 or
and 12/31/2010? 2010, but for which construction
1/1/2009 and 12/31/2010,
began in 2009 or 2010, applications
was the property placed in must be submitted after the property
Y service after 2010 and has been placed in service and
E before the credit before October 1, 2011.
S 3. Eligible persons must be the owner
termination date? or lessee of the property and must
YES
Grant amount equal to have originally placed the property in
service.
10% or 30% of the tax 4. See
basis of the eligible http://www.treas.gov/recovery/docs/g
property, depending on uidance.pdf for more information
regarding credit termination dates
the type of property and applicable payment percentages.

Alternative Motor Vehicle Credit – Section 30B

Did the taxpayer purchase
a qualifying fuel cell, No additional benefit
NO
hybrid, advanced lean burn available
technology or alternative
fuel vehicle?
Y
E
S

Credit up to $2,400

Plug-In Electric Vehicle Credit – Section 30D
Did the taxpayer purchase No additional benefit
or lease and place in NO
available
service a qualifying plug-in
hybrid vehicle?
Y
E
S
10% credit up to $2,500
10% credit up to $4,000
$7,500 maximum for low-speed vehicles,
OR OR for plug-in vehicle
credit motorcycles and three-
wheeled vehicles
conversions

Alternative Refueling Property Credits –
Section 30C

Did the taxpayer install
qualified* clean-fuel vehicle
refueling property to be NO
used in a trade or available
Y business?
E
S

50% credit of up to 30% credit of up to
OR
$50,000 $200,000 for hydrogen

* Clean-burning fuels are at least 85% composed of ethanol, natural gas, compressed natural gas, liquefied natural gas, liquefied petroleum gas
or hydrogen – or any mixture of biodiesel and diesel fuel containing at least 20% biodiesel.

Qualified Reuse & Recycling Property –
Section 168(m)

* Qualified reuse and recycling
Did the taxpayer have property is machinery or
qualified reuse and No additional benefit equipment that is used
NO
exclusively to collect, distribute or
recycling property*? available recycle qualified reuse and
Y recyclable materials. It also
E includes software necessary to
S operate such equipment.

Bonus Depreciation
Equivalent

Fringe Benefits for Employees – Section 132
There are two new “green”
provisions allowing increased
fringe benefits. Fringe benefits Fringe benefit
Bicycle provided to employees are not exclusion for
commuters - taxed as income, even if the transit is
$20/month fringe employer offers the employee a increased to
benefit exclusion choice between cash $230 in 2009
compensation and the fringe
benefit.

Incentives for Specific Manufacturers & Developers

FEDERAL INCENTIVES

Alcohol Fuel (Ethanol) Producer Credit –
Section 40

Did the taxpayer produce No additional benefit
190-proof alcohol for use NO
available
as a fuel or blending into
fuel?
Y
E
S
Additional 10¢/gallon
Higher credit rate for
60¢/gallon credit small ethanol producer
cellulosic biofuel
credit

Biodiesel & Renewable Diesel Credit – Section 40A
Did the taxpayer produce No additional benefit
NO
qualifying biodiesel & available
renewable diesel?

Y
E
S
Incentive may be taken as an income tax
$1.00/gallon credit credit, an excise tax credit or as a payment
from U.S. Treasury Department

See Appendix C

Energy-Efficient Appliance Credit – Section 45M

Did the taxpayer
manufacture energy- No additional benefit
NO
efficient clothes washers, available
dishwashers and/or
refrigerators?
Y
E
S

Washers Dishwashers Refrigerators
$75 - $250 per appliance $45 - $75 per appliance $50 - $200 per appliance

Energy-Efficient New Homes Credit – Section 45L
Did the taxpayer construct No additional benefit
new homes that meet NO
available
certain energy efficiency
standards?
Y
E
S

Up to $2,000 credit
per home

Incentives Geared to Energy Industry

FEDERAL INCENTIVES

Renewable Electricity Production Credit –
Section 45
2.1¢/kWh for wind,
geothermal, closed-loop
biomass; 1.1¢/kWh for
other eligible
technologies*

Did the utility company
produce and sell electricity from
renewable sources such as Did the taxpayer produce
landfill gas, wind, solar, O excess electricity from
hydroelectric, geothermal or R renewable sources and sell it
biomass that were placed in back to the grid?
service before 12/31/2012?

available

*Note that the duration of the credit is generally 10 years after the date the facility is placed in service, but there are two exceptions:
Open-loop biomass, geothermal, small irrigation hydro, landfill gas and municipal solid waste combustion facilities placed into service
after October 22, 2004, and before enactment of the Energy Policy Act of 2005, on August 8, 2005, are only eligible for the credit for a
five-year period.

Open-loop biomass facilities placed in service before October 22, 2004, are eligible for a five-year period beginning January 1, 2005.

Qualifying Advanced Energy Project Investment
Credit – Section 48C
Did the utility company invest in a
qualified advanced energy No additional benefit
NO
manufacturing project(s) that available In total, $2.3 billion worth of
establishes, re-equips or expands a
manufacturing facility?
credits may be allocated under
Y this program.
E
S In determining which projects to
certify, the U.S. Treasury
Did the project produce any of the following: Department must consider those
1. Equipment and/or technologies used to produce energy from the sun, wind, geothermal or “other” which most likely will be
renewable resources; commercially viable, provide the
2. Fuel cells, micro-turbines or energy-storage systems for use with electric or hybrid-electric motor
greatest domestic job creation,
vehicles;
provide the greatest net reduction
3. Equipment used to refine or blend renewable fuels; or
4. Equipment and/or technologies to produce energy-conservation technologies (including energy-
of air pollution and/or greenhouse
conserving lighting technologies and smart grid technologies)* gases, have great potential for
technological innovation and
Y commercial deployment, have the
E lowest levelized cost of generated
S (or stored) energy or the lowest
Did the taxpayer apply and receive U.S. Treasury Department levelized cost of reduction in
certification for the project? energy consumption or
Y greenhouse gas emissions, and
E have the shortest project time.
S
30% credit (taxpayer may not combine with business energy
investment tax credit)

*This credit may be expanded in the future to include other energy technologies that reduce greenhouse gas emissions, as determined
by the U.S. Treasury Department.

Note: The U.S. Treasury Department, in consultation with the U.S. Department of Energy, must create additional specific program
guidelines and the application process by August 16, 2009.

Alternative Fuel Credit – Sections 6426 & 6427
The credit may be claimed as:
Alternative fuels that may qualify
(1) an excise tax payment on
for the 50¢ per gallon refundable
Form 8849, Claim for Refund of
tax credit include:
Excise Taxes; (2) an excise tax
credit on Form 720, Quarterly
Liquefied petroleum gas,
Federal Excise Tax Return; or (3)
including propane; alcohol fuels
as a refundable income tax credit
defined by the Department of
on Form 4136, Credit for Federal
Energy as “P Series Fuels” under
Tax Paid on Fuels. The taxpayer
42 USC 13211(2); compressed or
must coordinate its claims to
liquefied natural gas; liquefied
prevent double usage of credits
hydrogen; liquid fuel derived from Sections 6426 & 6427 provide various and refunds. Excise tax
coal; compressed or liquefied gas
per-gallon credits for alternative fuels, payments and credits are
derived from biomass defined
generally included in taxable
under §45K(c)(3); liquid fuel including alcohol or ethanol. income, but refundable income
derived from biomass defined
tax credits claimed on Form 4136
under §45K(c)(3), but excluding
See Summary of Alternative Fuel Credit Incentives Chart may not be.
ethanol, methanol or biodiesel.
To claim alternative fuel credits or
payments, the taxpayer must first
register for excise tax activities by
filing Form 637, Application for
Registration (for Certain Excise
Tax Activities).

Summary of Alternative Fuel Credit Incentives
Alcohol Fuel Qedit (Neat) §40(a)(2) Alcohol 1mm biomass that is at least ISO-prool. Income Tax ISO-Prool [tha nol = 12/31/2010
Neatluel mustbe usedasa luelin producers 45C/Gal
business or sold at retail byproducer into a motor
vehidetanlc. 150-Prool[thanol =
33.33C Gal

ISO-Wool Methanol =
I
&C Gal

ISO-Wool Methanol =
451/Gal
Alcohol Fuel lixture Credit §40(a)(1) Mixture of alcohol Irom biomass that is at least Income & ISO-Prool [tha nol = 12/31/2010
I50-proolwith gasoline or motorfuel that is used [iseTax 451/Gal
as a fuel in producer's business orsold by
§6126(b) roduceras a fuel. 15O-Ptool[thanol =
33.331 Ga

§6121(efll) 1S0-Prool Methanol =
01 / Gal
150-Prool Methanol =
451/Gal
Small Ethanol ProducerCiedit §40(a)(3) Small pioducerof 150-proof ethanol 1mm biomass IncomeTax 150-ProolEthanol = 12/31/2010
that producer uses as a fuel or sells as a luel. 101/ Gal
May be mixed or neat. limited to 15 mil. gallons
perar.Asmall produceris generallyOmil.
allonsorless er ar.
Cell ulosic Biofuel Credit §40(a)(4) liquid fuel lorm renewable cellulosic matterthat Income Tax SLO1/ Gal, reduced by 12/31/2012
meets(Iean AirAct §211,and which produceruses alcohol mixture and
as a fuel or sells as a luel. May be mixed or neat small etha nol producer
If alcohol, it must be 150-proof. credits, ilfuel is alcohol

Summary of Alternative Fuel Credit Incentives
(continued)

Biodiesel Ciedit (Neat) §40A(a H?) Fattyacids from plant or a nimal mailer that meets Income Tax $1.00, Ga lion 12/31/2000
ji) clean AirAct §211, and (ii) ASIM Standard
D6JS1. Neat fuel must be used as a fuel in
producer's business orsold at ,etail bypioducer
into a motor tiehicle tank.
Biodiesel MixtureCredit §40A(a)(1) Mixtureofbiodiesel anddiesel fuel thatis used lncome& $1.00/Gallon 12/31/2009
as a fuel in producer's business or sold by ExciseTax
§6426(c) producer as a fuel.

§6421(e)(1)
Small Agri-Biodiesel Credit §40A(a)(3) Small producer of biodiesel that producer uses as Income lax 1OC/ Gal Ion of 12/31/2009
a fuel or sells as a fuel. May be mixed or neat. flgri-Biodiesel
limited tol5mil.gals/year. Asmall producer is
generally 60 mu. gallons or less per year.
IU(.1tflstIttSiItURIIIIII.1[,)t}. , IiftII.taPnzgtc,,lI[EI IhJ4

and which meets Clean Air Act4211.
Reduces ExciseTax from Indicated

24.3C down to 19.1C
Alternative Fuel Credits (Neat) §6426(dJ liquid petroleum gas; .P Series alcohol fuels; ExciseTax SOC/ Gal Ion 12/31/2009

§6421(e)(2J Compressed or liquefied natural gas; liquid
hydrogen; liquid coal fuel; Compressed or
liquefied biomass gas; liquid biomass fuel
(excludingethanol, methanol, or biodieselj. Fuel
must be used or sold for use in a motor vehicle.
Alternative Fuel MixtureCredits §6426(e) Mixtureofalternativefuel with diesel fuel, ExciseTax SOC/Gallon 12/31/2009
gasoline, or kerosene. The mixture must be sold
as a fuel or used as a fuel in the producer's
§6421(e)(1) business.

Personal Incentives for Individuals

FEDERAL INCENTIVES

Residential Energy-Efficient Home
Improvements Credit – Section 25C

Did the taxpayer install energy-efficient property,
NO No additional benefit
such as water heaters, central air conditioning and
heating, boilers, heat pumps, air conditioners, available
building insulation, windows, doors, roofs or
circulating fans used in a qualifying furnace?

Y
E
S
30% credit of up to $1,500
Were the qualified purchases
for all improvements
between 1/1/2009 and
combined during 2009 and
12/31/2010? YES
2010

You can find a list of qualifying home improvement equipment from the Energy Star web site:
www.energystar.gov/index.cfm?c=tax_credits.tx_index

Summary of Tax Credits for Homeowners
Insulation Insulation Meets 2009 IECC & Amendments 30%of cost urflç For insulation to qualify, its primary purpose
s15001 must beth insulate (example: insulated siding
doesnot.uali ).

Check to see if you have Home Performance with
ENERGYSTAR in your ares. Adding insulation to
ur home is covered.
Windows & Doors Exterior Windows and Beforelunel 2009: 30%of cost up to Notall ENERGYSTAR labeled windows and
Skylights 51,5001 s lihts .uali fortaxcredit
Must mea ENERGY STAR criteria More information

Afteriunel 2009:
Ufactorc=030

SIIGCc=0.30
Storm Windows In combination with the exterior 30%of cost up to FAQ on storm doors and storm windows.
window over which itis installed: 51,5001
1. has a U-factor and SIIGC of 030
or below
2. Meets the IECC
Exterior Doors Beforeiunel 2009: 30%ofcosç up to Notall ENERGY SlARdoors will qualify.
Must med ENERGY SFAR criteria 51,5001 More information

Afteriunel 2009:
Ufactorc=0.30

SIIGCc=0.30

(continued)

Windows & Doors (cont) Storm Doors In combination with a wood door over 30%of cost up to FAO on storm doors and storm windows.
which itis installed: 51,5001
1. has a U-factor and SIIGC of 030
or below
2. Meets the IECC
Roofing Metal Roofs, All ENERGYSTARqualified metal and 30%of cost up to FN on roofs thatqualify for the tax credit
Asphalt Roofs reflective asphalt shingles 51,5001

Central A/C SplitSystems 30%of cost up to FMI on Central Ns thatqualify for thetax credit
51,5001
[ER '=13
SEER 16 FAQ on Air Source Heat Pumos that uualify for
the tax credit

'a.i'gesy r1fl5 '. noa ' ipr..uc.wi
qualify for thetax credit View ENERGY SMR
criteria.
[[R'=12
SEER 14
Air Source 1-leat Pumps SpktSysterns. 30%ofcosç up to
I-ISPF 83 $is001
[ER 123
SEER 15

Package systems:
IISPF>=8
EER 12
SEER 14

(continued)

uvw (cont) Natural Gas or Propane AFUE >= 95 30%of cost up to FM) on Furnaces and Boilers thatqualify for the
Furnace $15001 tax credit
Oil Furnace AFUE 90 30%ofcosç up to
$15001 Note notall ENERGYSIAR products will
qualify for thetax credit View ENERGY STAR
Gas, Propane, or Oil I-lot AFUE 90 30%of cost up to
criteria for furnaces, boilers.
Water Boiler $15001
Advanced Main Air No more than 2% of furnace total 30%of cost up to Read this FM) if the fan qualifies, but the
Circulating Fan energy use. $15001 furnace does not
Water 1-leaters Gas, Oil, Propane Water Energy Factor '= 022 30%of cost up to FAQ on Water Heaters thataualifv for the tax
I-lea ter or a thermal efficiency of at least 90%. $15001 credit
Electric Heat Pump Water Samecriteria as ENERGYSTAR: Energy 30%of cost up to View ENERGY STAR criteria for water heaters.
I-lea ter Factor '= 2.0 $15001
Biomass Stove Biomass Stove Stovewhich burns biomass fuel to 30%of cost up to FAQ on biomass stoves.
heata homeor heat water. $15001

Thermal efficiency rating of at least
75% as measured using a lower
heating value.

(continued)

Geothermal Heat Pump Geothermal Heat Pump Samecriteria as ENERGY STAR: 30% of the cost All [N[RGYSTAR .-thermal heat urn's .uali
for the tax credit

Closed mop: Must be "placed into servic before December
31.2016.
[ER '= 14.1
COP '=3.3

Open Loop:
[ER '= 16.2
COP '=3.6

Direct Expansion:
[ER >= 15
COP >=3.5
Solar Energy Systems Solar Water Heating At least half of the energy generated 30%of cost All ENERGY STAR solar water heaters qualify for
by the ifying property must the lax credit
come from the sun. Homeowners may
only claim spendingon thesolar
water heating system property, not the
entire water heating system of the
household.

The credit is notavailablefor Must be placed in service before December31
expensa for swimming pools or hot 2016.
tubs.

The water must be used in the
dwelling.

The system must be certified by the
Solar Ratingand Certification
Cor oration (SRCC).

(continued)

Solar Energy Systems Photovoltaic Systems Photovoltaic systems must provide 30%of cost Must be placed in service before December31
(cont) electricity for the residence, and must Z1!1L
meetapplicablefireand electrical
code requirement
Small WindEnergy Residential Small Wind has nameplatecapacityofnotmore 30%of cost Mustberilaced inservicebeforeDecember3l.
tems Turbines than 100 kilowatts. 2016.
Fuel Cells Residential Fuel Cell and Efficiency of atleast3o% and must 30%of the cost up Mustbeplaced in service before December 31
microturbine system have a capacity of at least 0.5 kW. to $500 per .5 kW 2016.
of wer ca aci
Cars Hybrid gasoline-electric, Based on a formula There is a 60,000 vehicle limit per manufacturer
diesel, battery-electric, determined by before a phase-out period begins. Toyota and
alternative fuel, and fuel cell vehicle weight Honda havealready been phased out Credit is
vehicles technology, and still availablefor Ford, GM and Nissan.

compared to base
yr models
For more information visit Fueleconomy.gov
Use IRS Form 8910
for hybrid vehicles purchased for personal use.
Use IRS Form 3800
for hybrid vehicles purchased for busi ness
purposes.
Plug-in hybrid electric 5250041,500 Thefirst25o,000 vehicles sold getthefull tax
vehicles credit (then it phases out like the hybrid vehicle
tax credits).
[ifectiveianuary 1,2009.

to a $1500 mudmum per homeowner foruI improvements combinet

Residential Energy-Efficient Property Credit –
Section 25D

Does the taxpayer have an energy-efficient
property, such as solar water heaters, geothermal
heat pumps, fuel cells or wind turbines? NO
Y available
E
S

30% personal tax credit

See Appendix C

Plug-In Electric Vehicle Credit – Section 30D
Did the taxpayer purchase No additional benefit
or lease and place in NO
available
service a qualifying plug-in
hybrid vehicle?
Y
E
S
10% credit up to $2,500 for
low-speed vehicles, 10% credit up to $4,000 for
$7,500 maximum credit OR
motorcycles and three-
OR
plug-in vehicle conversions
wheeled vehicles

Starting January 1, 2009, there is a new tax credit for Plug-in hybrid electric vehicles, starting at $2,500 and capped at $7,500 for cars and trucks
(the credit is based on the capacity of the battery system). The first 250,000 vehicles sold get the full tax credit (then it phases out like the hybrid
vehicle tax credits).

Tax credits are available to buyers of hybrid gasoline-electric, diesel, battery-electric, alternative fuel, and fuel cell vehicles. The tax credit amount
is based on a formula determined by vehicle weight, technology, and fuel economy compared to base year models. These credits are available
for vehicles placed in service starting January 1, 2006. For hybrid and diesel vehicles made by each manufacturer, the credit will be phased out
over 15 months starting after that manufacturer has sold 60,000 eligible vehicles. For vehicles made by manufacturers that have not reached the
end of the phase-out, the credits will end for vehicles placed in service after December 31, 2010. See the IRS website for updated information
http://www.irs.gov/newsroom/article/0,,id=157557,00.html .

Incentives for Businesses

STATE & LOCAL INCENTIVES

State & Local Incentives for Businesses
• There are many state and local incentives available to
businesses that are energy efficient, invest in energy-
efficient products, produce renewable energy, manufacture
renewable energy products, construct energy-efficient
buildings, or remodel buildings so that they are energy-
efficient.
• These incentives could include tax credits, abatements or
exemptions, cash grants or rebates, accelerated
depreciation, and below-market financing.
• In addition, many utilities offer incentives for operating in an
energy-efficient manner, such as reduced rates or rebates.

See Appendix A for information with
respect to specific states.

Incentives for Individuals

STATE & LOCAL INCENTIVES

State & Local Incentives for Individuals

To encourage the use of
Many state and local governments alternative fuel vehicles,
also provide incentives to states offer credits,
individuals to promote the use of grants, loans, rebate
energy efficient products such as programs, incentives and
exemptions.
alternative fuels. These incentives
could include such things as tax
credits, tax rebates, tax
exemptions, tax deductions and
cash grants.

See Appendix B for information with respect The matrix also lists the
to the incentives for using alternative fuel available credits, grants,
and energy-efficient vehicles in specific loans, rebate programs,
states. incentives and exemptions
for vehicles.

Energy Credits & Incentives

APPENDIX A

Renewable Energy & Energy Efficiency Credit
Incentives

Renewable Energy & Energy Efficiency Credit
Incentives (continued)

Alternative Fuel & Vehicle Credits & Incentives

APPENDIX B

(continued)

Tax Incentives Assistance Project Summary of Federal Energy
Efficiency Tax Incentives

APPENDIX C
Source: American Council for an Energy-Efficient Economy

Tax Incentives Assistance Project Summary of Federal Energy Efficiency Tax Incentives
For more information see: www.energytaxincentives.org

Eligibility Information Amount of Incentive Years Covered Notes
Product
Existing homes and other non-business applications $1,500 per taxpayer cap for existing home energy efficiency incentives
Central Air Conditioners and Air-Source Heat Pumps Must achieve highest efficiency 2009-2010 For list of qualified products, go to the Consortium for Energy
tier established by CEE as of 30% of the cost of installation (includes Efficiency Product Directory web site:
1/1/2009. For most equipment, materials and labor)
this is SEER 16. www.ceehvacdirectory.org/continue.html
Water heaters (non-business applications) See AHRI Web site for list of qualifying products:
30% of the cost of installation (includes
Electric 2.0 EF 2009-2010
materials and labor)
Gas and oil 0.82 EF 2009-2010
*or a thermal efficiency of at least 90% http://www.ahrinet.org/Content/FederalEnergyEfficiencyTaxCredits_853.aspx
Gas and oil furnaces and boilers See AHRI Web site (link above) for list of qualifying products.
Furnaces (gas & propane) 95 AFUE 2009-2010 There is also an incentive for furnace fans. Check the TIAP site for details.
materials and labor)
Boilers and oil furnaces 90 AFUE 2009-2010
Biomass Stoves Thermal efficiency of 75% as 30% of the cost of installation (includes
measured using a lower heating materials and labor) 2009-2010 See www.pelletheat.org for more information
Envelope improvements to existing homes
Insulation, duct sealing and infiltration reduction Meet 2009 IECC & supplements Includes duct sealing and infiltration reduction.
Exterior doors, windows and skylights Equal to or below 0.30 U Factor
and SHGC of 0.30 2009-2010 There is also an incentive for window films. See the TIAP site for details.
materials only)
Roofs made of metal with pigmented coatings or asphalt with cooling Meet Energy Star spec
granules
All appliance incentives go to manufacturer, not consumer; manufacturers are
Appliances expected to reduce prices accordingly.
Refrigerators
Save 20-22.9% relative to federal standard Look to left $50 2008
Save 23-24.9% relative to federal standard Look to left $75 2008 & 2009
Save 25-29.9% relative to federal standard Look to left $100 2008, 2009 & 2010
Save 30% or more relative to federal standard Look to left $200 2008, 2009 & 2010 MEF: Modified Energy Factor. The higher the MEF, the more efficient the unit.
Clothes Washers
Meet/Exceed 1.72 MEF, do not exceed 8.0 WCF residential, top-loading $75 2008 WCF: Water Consumption Factor. The lower the WCF, the more water efficient
Meet/Exceed 1.8 MEF, do not exceed 7.5 WCF residential, top-loading $125 2008 & 2009 the unit.
Meet/Exceed 2.0 MEF, do not exceed 6.0 WCF residential or commercial $150 2008, 2009 & 2010
Meet/Exceed 2.2 MEF, do not exceed 4.5 WCF residential or commercial $250 2008, 2009 & 2010 The credit to manufacturers is capped at $75 million for the period of 2008 -
Dishwashers 2010. The most efficient refrigerators (30%) and clothes washers (2.2 MEF/4.5
Models using no more than 324 kilowatt hours/year and 5.8 gallons of water/cycle $45.00 2008 & 2009 WCF) are exempted from this cap.
Models using no more than 307 kilowatt hours/year and 5.0 gallons of water/cycle (5.5 gallons/cycle $75 2008, 2009 & 2010
for dishwashers designed for greater than 12 place settings)
New Homes Incentives go to the builder, not the homebuyer.
Site-built or manufactured homes 50% savings $2,000 2006 - 2009 Savings relative to 2004 IECC.
Manufactured homes 30% savings $1,000 2006 - 2009 Savings relative to 2004 IECC.
or meets Energy Star 2006 - 2009
Commercial Buildings Max. is $0.60/sq.ft. per system or $1.80/sq.ft. for whole bldg.
Whole building 50% savings Deduction of $1.80/sq.ft. 2006 - 2013 Savings relative to ASHRAE 90.1-2001.
Lighting, HVAC or envelope 50% savings Deduction of $0.60/sq.ft. per system 2006 - 2013 Savings relative to ASHRAE 90.1-2001.
Lighting savings of at least 25% 25-50% savings Sliding scale: $.30/sq.ft. for 25% svgs Unclear Term of this provision depends on Treasury rulemaking.
Combined Heat and Power 10% investment tax credit, applicable to the first 15MW of CHP property. See www.energytaxincentives.org/business/chp.php for details.
Fuel Cells and Microturbines Systems >=0.5 kW for credit. The increase to $3,000/kW incentive for
Fuel Cells: Businesses, utilities, telecommunications firms 30% efficiency 30% up to $3000/kW businesses is valid for units placed in service after October 3, 2008. Prior to that
Fuel Cells: Residential 30% efficiency 30% up to $1000/kW 2006 - 2016 the incentive is $1,000/kW.
Microturbines (only business credit) 26% efficiency 10% up to $200/kW Systems < 2000 kW.
On-Site Renewables 30% of system installed costs, with some caveats (see below)
Solar Photovoltaic (PV) and Solar Water Heating Systems See site for details. 30% up to $2,000* 2006 - 2016 *On-site renewable property installed after December 31, 2008 is not subject
On-Site Small Wind 100 kW capacity or less 30% up to $4,000* 2008 - 2016 to any cap or restriction beyond the 30% of installed cost.
Geothermal Heat Pumps Meets Energy Star spec. 30% up to $2,000* 2008 - 2016** See TIAP web site for details.
**Commercial buildings installing heat pumps can only take the $2,000 incentive if installed after Oct. 3, 2008. See http://www.geoexchange.org/ for more information
Vehicles For details on passenger vehicle/consumer vehicle incentives:
Passenger hybrid and alternative-fuel vehicles, and plug-in electric www.energytaxincentives.org/consumers/vehicles.php
See www.aceee.org/transportation/hybtaxcred.htm for details on credit Dependent on
vehicles For details on commercial vehicle incentives:
calculation manufacturer sales
Heavy-duty vehicles www.energytaxincentives.org/business/commercial_vehicles.php

Key: AFUE= annual fuel utilization efficiency; ASHRAE = American Society of Heating, Refrigerating & Air-Conditioning Engineers; CEE = Consortium for Energy Efficiency
EF= energy factor; HSPF= heating season performance factor; IECC= International Energy Conservation Code; kW= kilowatt; SEER= seasonal energy efficiency ratio; SHGC= Solar Heat Gain Coefficient; WF= water factor.

Prepared by the American Council for an Energy-Efficient Economy for the Tax Incentives Assistance Project (TIAP)
www.energytaxincentives.org Updated February 2009

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