2005 Federal Energy Act:
The Impacts on Energy Efficiency

Key Provisions
Commercial and Industrial Buildings

For 2006 and 2007, tax deductions up to $1.80 per square foot for energy efficient upgrades to lighting, HVAC, hot water, and the building envelope that reduce energy and power consumption by 50% compared to ASHRAE standards, and 60 cents per square foot for sub-systems.

State incentives for residential and commercial energy efficiency code improvements.

Residential Buildings
New Homes—For 2006 and 2007, tax credits for home builders for up to:

$2,000 for new single family and manufactured homes with annual heating and cooling energy consumption less than half a comparable home (with other provisions).

$1,000 for new manufactured ENERGY STAR qualified homes with annual heating and cooling energy consumption less than 70 percent of a comparable home (with other provisions).

State incentives for residential and commercial energy efficiency code improvements.

Home Improvements—For 2006 and 2007, tax credits of up to $500 ($200 maximum for windows) for energy efficiency improvements to the building envelope, or purchases of qualified electric heat pump water heaters, electric heat pumps, furnaces and boilers, main air circulating fans, geothermal heat pumps, and central air conditioners.

Energy Efficient Products

For 2006 and 2007, appliance Manufacturer Tax Credits are available (up to a production limit) for:

Up to $100 for ENERGY STAR (2007) qualified dishwashers.

$100 for Energy Star (2007) qualified clothes washers.

$75 for refrigerators that save 15 percent energy from 2001 standards,
$125 for refrigerators that save 20 percent energy, or
$175 for refrigerators that save 25 percent energy.

State Energy Efficient Appliance Rebate program—up to 50 percent of the funds for State-run rebate programs for Energy Star products may be paid by the U.S. Department of Energy (DOE)—up to $50 million is available each year for 2006 through 2010, divided among eligible States.

New Energy Conservation Standards or Rulemaking Procedures. New efficiency standards will be established for many items, including compact fluorescent lamps, T12 ballasts, mercury vapor light ballasts, commercial pre-rinse spray valves, dehumidifiers, distribution transformers, battery chargers, external power supplies, illuminated exit signs, refrigerated beverage vending machines, torchiere lamps, traffic signals, unit heaters, ceiling fans and ceiling fan light kits, commercial air conditioning and heating equipment, commercial refrigerators and freezers, commercial ice makers, and commercial clothes washers.

Government Buildings

Energy Savings Performance Contracts were reauthorized through September 2016.

An energy and water savings plan for the Capitol must be developed.

Federal agencies may retain funds appropriated for energy and water expenditures that are saved, to be used for energy efficiency, water conservation, or renewable energy projects.

There will be new Federal building energy efficiency performance standards.

Grants are available to States for energy efficiency upgrades in public buildings.

Low-Income

Includes low income weatherization assistance —$500 million for 2006, $600 million for 2007, and $700 million for 2008.

Includes grants to low-income communities for energy efficiency improvements—$20 million/year.