Friday, February 27, 2009

What is "Main Air Circulating Fan"

The new stimulus bill has a tax credit for "main air circulating fan" accourding to Energy Star web site. Well what does that mean. The answers are not clear yet. It looks like congress got ahead of the HVAC industry manufactures. This rebate has not been cleared up yet. But if you look at the original 2009 and 2007 Energy Tax credit that meant if you buy a furnace with a ECM (Electrically communicating motor) blower you got $50. More commonly the ECM motors are known as "variable speed" furnace.

What is benifit to V.S. motors?

The average furnace in your home has a motor that is typically 45-50% efficient. So meaning every dollar you spend to run the furnace fan you waste 1/2 of it. The average VS motor will be 95-98% Efficient. So you only wast 5 cents out of every dollar you spend. A typicall 2000 Sq Foot home in Minnesota running there furnace fan in the "On" position on the thermostat will spend about $200 per year in electricity. If you have a VS furnace that will drop to about $45-60 per year. It is not uncommon to save $150/year. The cost savings will go up to $225-275 per year when you get into a larger home around 3500-4000 Sq Foot.

Why should you run the furnace fan 100% of the time?

  • better air quality because you are always filtering the air as it goes through the furnace filter
  • more even temperatures from room to room in your house or even more even temp from one floor to another

What is down side of running fan 100% of time?

  • cost more money if you don't have an ECM motor
  • worse dehumidification in the summer time when cooling

So now, what does this new tax credit mean for the Stimulus Bill?
No body knows yet. (nice answer, I must be in congress) The way it currently reads accourding to Energy Star if you buy a qualifying furnace with ECM motor you will get a 30% tax credit with a max payout of $1500. That is a great deal if it turns out that way. Currently I have talked with multiple manufactures like Trane, Bryant, Amana, Goodman, and UPG(York) and they are all trying to get clarification from the IRS on this. So far it is looking like a good deal.

Ok, one more catch. There is one know fact but not talked about with having an ECM motor in your furnace. If you have a poorly installed duct system you may not save as much money as you should. Furnace duct systems are rated by Static Pressure. It is like your blood preasure, the higher it is the worse. If you have a poorly installed heating or cooling system this will easly double the design static pressure which will then drastically increase your electrical use. The Static Pressure should be tested regularly on your HVAC system, but unfortinatly only about 10-15% of heating contractors even know how to do it. It is easy, and doesn't cost much. A quality HVAC contractor will test static pressure every time they are servicing your system or installing a new one. There are many ways to save money in energy use, it just takes the right heating and cooling profesional to help you.

Thursday, February 26, 2009

Energy Tax Credit Act of 2009 (Stimulus Bill)

Expansion of The Energy Tax Credits in the American Recovery & Reinvestment Act of 2009.

Well the new stimulus bill has money in it for homeowners to get up to 30% tax refund if they make there home more energy efficient.

The tax credit is for qualifying windows, insulation, and heating systems.

Heating Systems Included:

Geothermal Heat Pump Closed Loop Open Loop Direct Expansion

14.1 EER 16.2 EER 15 EER

3.3 COP 3.6 COP 3.5 COP

Natural Gas Furnace 95% AFUE

Natural Gas Hot Water Boiler 90% AFUE

Propane Furnace 95% AFUE

Propane Hot Water Boiler 90% AFUE

Oil Furnace 90% AFUE

Oil Hot Water Boiler 90% AFUE

Gas, Oil or Propane Water Heaters .82 Energy Factor

90% Thermal Efficiency

Electric Heat Pump Hot Water Heater 2.0 Energy Factor

Wood Stoves 75% Thermal Efficiency as measured using a lower heating value.

Advanced Main Air Circulating Fan (ECMs) No more than 2% of furnace total energy use

You can earn up to 30% credit on furnace, A/C, Air source heat pump, or water heaters. With a max cap of $1500. Example, you buy a new qualifying 95% Furnace and it cost $4500 installed you will get $1350 back on taxes. The way the tax part works is for example you have to pay in $2000 on your 2009 taxes you will now only pay in $650.

If you install Geothermal or Solar products your get 30% back with no cap. So if you buy a $15,000 Geo system you will get $4500 back. That new Geo system just cost you $10,500 plus you still get any local rebates avalable.

This is a huge part of the stimulus bill. This is money you as a citizen can actually get directly back to you. Plus you will be saving money on your monthly heating or cooling bills. Kind of a gift that keeps giving.

You can go to Energy Star: for detail information.

I would make sure you find a quality installing contractor with any of these options. Because a poor installation will not allow the equipment to save you any money. A new furnace or boiler is not like buying a TV or refrigerator. You can't just take it home and plug it in. There are many installing companies that treat them that way and it is far from that way. Sometimes the cheapest options cost the most in the long run. Unfortinatly I have learned that to many times in life.

Make sure you always check with your CPA to verify your tax situation will qualify for the credit. But pretty much most everyone that has a job and pays taxes should get the credit.