Most
homeowners
(74
percent)
are
aware
of
federal
tax
credits
for
certain
energy-saving
home
improvements,
but
only
23
percent
took
advantage
of
it
on
their
2006
tax
returns.
That's
despite
the
fact
that
78
percent
of
homeowners
reported
that
their
2006
heating/cooling
costs
increased
5
percent
or
more
than
their
2005
costs,
and
only
32
percent
believe
that
their
home
is
already
energy
efficient.
"The
2006
Energy
Efficiency
Tax
Credit
Survey"
of
1,040
American
adults
conducted
by
Opinion
Research
Corp.
for
building
products
manufacturer
Johns
Manville
may
sound
a
bit
self-serving,
but
it
is
also
an
eye-opener
in
energy
efficiency
--
or
the
lack
of
it.
The
Bureau
of
Labor
Statistics'
April
Consumer
Price
Index
reveals
all
energy
costs
rose
2.9
percent
in
the
past
year,
ending
in
April,
but
the
compound
annual
rate
was
a
whopping
43.4
percent.
The
compound
rate
is a
projection
assuming
the
rate
of
increase
in
energy
costs
over
the
past
three
months
continues
at
the
same
level
for
the
next
12
months.
"Energy
costs
are
volatile,
and
as
the
world's
consumption
of
energy
continues
to
increase,
energy
bills
are
expected
to
increase,"
said
Kateri
Callahan,
president
of
the
Alliance
to
Save
Energy.
"Reducing
our
consumption
is
the
quickest,
most
cost
effective
and
cleanest
way
to
extend
our
world's
energy
supplies.
Homeowners
can
directly
help
the
situation,
and
themselves,
by
making
energy
efficiency
upgrades
to
their
homes,"
she
added.
The
same
Energy
Policy
Act
of
2005
that
extended
Daylight
Saving
Time,
also
allows
for
a
tax
credit
of
up
to
10
percent
of
the
cost
of
materials
for
qualified
home
improvements,
such
as
installing
Energy
Star-rated
windows,
doors,
heating
and
cooling
equipment,
insulation
and
air
sealing
products.
The
federal
law,
which
offers
a
tax
credit
of
up
to
$500
per
household,
was
specifically
created
in
response
to
rising
energy
prices.
Another
provision
of
the
same
law
provides
for
a
tax
credit
equal
to
30
percent
of
qualifying
expenditures
for
qualified
photovoltaic
power
generating
and
solar
water
heating
equipment,
up
to a
maximum
credit
of
$2,000.
Right
now
the
credits
are
good
through
2007
and
some
states
offer
additional
financial
incentives.
A
tax
credit,
by
the
way,
reduces
the
amount
of
tax
you
owe,
dollar-for-dollar,
as
opposed
to a
tax
deduction
which
only
reduces
the
amount
of
income
against
which
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taxes
are
calculated.
Even
without
tax
benefits,
energy
efficient
home
improvements
are
a
no-brainer
in
today's
economy.
The
U.S.
Energy
Information
Administration's
recently
released
Annual
Energy
Outlook
2007,
says
energy
prices
are
expected
to
increase
steadily
through
2030.
"Savvy
homeowners
will
realize
that
insulation
upgrades
quickly
pay
for
themselves.
In
addition
to
the
energy
bill
savings,
adding
insulation
makes
your
home
more
comfortable
for
you
and
your
family
by
eliminating
drafts
and
hot
spots.
Also,
inefficient
homes
consume
more
fossil
fuels,
and
in
turn,
increase
the
amount
of
greenhouse
gasses
emitted
into
the
atmosphere,"
said
Mike
Lawrence,
vice
president
and
general
manager
for
Johns
Manville's
insulation
division.
He
added,
"There's
also
an
economic
benefit
when
it
comes
time
to
sell
your
home.
According
to
the
U.S.
Energy
Information
Administration,
adding
insulation
and
air
sealing
increases
your
home's
resale
value,
and
55
percent
of
Americans
are
willing
to
pay
more
for
energy-efficient
home
features."
But
there's
the
Catch-22.
The
survey
doesn't
venture
why
homeowners
are
not
performing
more
home
improvements
but
the
added-value
issue
may
be
just
what's
causing
homeowners
to
balk
at
energy-efficient
home
improvements.
Appraisers
say
they
don't
typically
calculate
energy
improvements
in
terms
of
added
value
because
standards
are
spotty.
Standards
are
spotty,
because
the
data
base
of
homeowners
with
energy
efficient
home
improvements
remains
too
small
to
consider
during
a
typical
home
sale,
refinance
or
home
equity
loan
appraisal.
Homeowners
aren't
compelled
to
fill
in
the
data
base
by
completing
more
energy
efficient
home
improvements
because
they
may
not
realize
increased
property
value
from
the
expenditure.
Remodeling
the
bathroom,
to
most
consumers,
appears
to
be a
better
value-enhancing
deal
than
stuffing
the
attic
with
insulation.
"It's
not
visibly
affirmable.
If
you
walk
into
a
home
and
see
an
extra
bath,
it's
visible.
With
energy
efficiency
the
only
time
you
are
cognizant
of
it
is
when
you
pay
the
bill.
That's
real,
but
it's
not
a
selling
point,"
said
Ted
Faravelli,
Jr.,
a
San
Jose,
CA-based
expert
witness,
forensic
real
estate
analyst
and
managing
director
for
the
California
Association
of
Real
Estate
Appraisers.
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