Legislation is moving through Congress to implement the “Cash For Caulkers” program President Obama called for in his State of the Union address. The House bill, introduced by Massachusetts’ Ed Markey, was sent forward from the Energy and Environment Subcommiittee to the full house Energy & Commerce Committee on March 24th, 2010.

Improving the energy efficiency of homes is a direct economic benefit to taxpayers through rebates and lowered energy costs. It generates economic activity and creates jobs, improves US energy security and is one of the lowest-cost “sources” of energy.

The Home Star Energy Retrofit Act of 2010 is comprehensive and addresses some key shortcomings of previous efforts. Funds would be distributed to and managed by individual states. The program:

  • covers a full range of energy efficiency measures for the home, from air sealing and insulation to heating and cooling systems
  • encourages comprehensive retrofits by offering an option (Gold Star) that pays based on the reduction in the total energy use of the home (up to $8,000 per home) as an alternative to the traditional approach of rebates for specific measures (Silver Star, up to $3,000 per home)
  • includes both products and installation so that the full job gets done
  • makes it easy for homeowners by:
    • targeting 60% of the funding – $3.6 billion – to financing the costs of making improvements
    • reducing the upfront costs by providing the rebates at the time the homeowner pays for the work

Key provisions, which include some creative options for implementing these programs, are below.

The American Council for an Energy Efficient Economy (ACEEE) estimates that the Home Star program could create 126,000 jobs in 2010, improve 3 million homes, save homeowners $1 billion yearly and avoid 4 million tons of CO2 emissions[1]. This legislation should be moved through the House of Representatives and the Senate should be encouraged to take it up and pass it sooner rather than later. It will be money well spent toward economic recovery, energy security and independence and a more sustainable economy.

The Home Star Coalition, a group of business and organizations supporting the program and legislation, is a good resource for tracking its progress.

Additional information about key provisions

Silver Star

  • Provides rebates for a range of installed energy efficiency improvements
  • Typically $1,000 for individual improvements, $3,000 maximum per home
  • Projected funding – $1.13 billion

Gold Star

  • Rebates for whole-home reduction in energy
  • Encourages more comprehensive retrofits
  • Provides flexibility for homeowners and contractors to focus on the most effective measures for the individual home
  • Several options for verification – home simulation software, HERS ratings, others
  • $3,000 rebate for 20% reduction in total energy use
  • $1,000 for each additional 5%
  • $8,000 maximum (45% reduction)
  • Projected funding: $567 million

Supported energy efficiency improvements

  • Whole house air sealing
  • Attic insulation
  • Duct sealing or replacement
  • Wall insulation
  • Crawl space insulation or basement wall and rim joint insulation
  • Window replacement (8 or more)
  • Exterior door replacement
  • Heating system replacement – includes gas, oil, wood, geothermal
  • Air conditioner or heat pump (includes geothermal)
  • Water heater replacement (direct, indirect, storage, tankless)
  • Storm windows (5 or more)

Financing

  • Largest component of the program – $3.6 billion
  • Allows a variety of qualified providers – utilities, government entities, not-for-profits
  • Encourage a variety of payment options including through utility bills or municipal assessments
  • Encourages different mechanisms – interest rate reduction, revolving funds, loan loss guarantees

References:

  1. American Council for an Energy Efficient Economy – Press Release and Analysis.
Home Star legislation details cash for caulkers
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