More Energy-Saving Ideas -- and a Book Giveaway

This week, Gail lists some inexpensive but effective ways to save energy -- and has a free book she'll be giving away to 20 readers!

Hi, Gail --

I read your Oct. 14, 2005 column about the tax breaks available if you make your home more energy efficient. Can you please tell me if a wood-burning fireplace also gets a tax deduction? If so, is the wood used for this purpose also deductible?

Thank you

Joyce

Dear Joyce,

Unfortunately, the answer is “No.” The Energy Policy Act of 2005 is very specific about the types of products and technology that qualify for these tax credits -- from beefing up the insulation in your home, to installing certain energy-efficient appliances. If something isn’t on the list, it isn’t eligible for a tax break.

To learn more about which items meet the requirements, you can visit the Web site of the non-profit American Council for an Energy-Efficient Economy (ACEEE), http://www.aceee.org . Information is also available from the under the Tax Incentives Assistance Project, a coalition of non-profit and government agencies. “TIAP” was formed to provide information to consumers and businesses so that they could take advantage of the tax credits provided by this Act. Check out the “Consumers” tab at: http://www.tiap.energytaxincentives.org

Don’t Be Fooled by an Unusually Mild Winter!

If you live in the northeastern part of the United States, as I do, you know we’ve been enjoying unseasonably warm weather since the start of the new year. Today, for instance, the temperature reached 55 degrees -- more like late April than mid-January. Then again, you may live in the southern half of the country where winter is normally mild; it’s summer that drives up your home utility bills.

While it’s human nature to postpone dealing with a problem until it’s staring us in the face, ACEEE’s Jennifer Amann says if you have home heating/cooling equipment that needs to be replaced anyway, you should think about doing it now and taking advantage of these tax breaks. For one thing, you’ll probably find that the new energy-efficient heater you need is available; when winter’s harsh temperatures return, a lot of folks will be scrambling to make the switch. At that point, not only could supplies be tight, but you might also have to get on a waiting list to get it installed. Ditto in terms of waiting until July to upgrade your air-conditioning system.

If you’ve got equipment that’s on its last legs -- a heating system, hot water heater, old refridgerator, etc. -- Amann says spending a little more to replace it with one that carries the “Energy Star” label will not only give you a tax credit, it will pay off in the long run in terms of lower energy bills. Also, check with your utility; some are offering additional incentives to trade in your older appliances. Buying a more energy efficient heater says Amann, “provides a hedge for the future. Just because this winter is mild, future winters may not be and we’ve been told to expect higher heating oil and natural gas prices next year.”

Inexpensive But Effective Ways to Save Energy

According to Amann, $25 will “get you a host of products that will save energy and make you more comfortable,” which is really the whole point. There are a host of ideas on the Web site for The American Council for an Energy-Efficient Economy. A more extensive list can be found in its “Consumer Guide to Home energy Savings,” which we will be giving away to 20 readers (see below).

Start by looking for ways to make your home’s “shell” less leaky. Although specific guidance is expected from the IRS shortly, Amann expects most of these actions, which are aimed at keeping the warm air from escaping during the cold months and preventing the cool air from seeping out during the summer, will also qualify for tax credits.

These can range from laying additional insulation in your attic to caulking around doors and windows. Feel a draft from the bottom of your outside door? Install a “door sweep,” a rubber strip that is either nailed or glued along the bottom of the door and stops outside air from getting in.

One common place for air leakage, especially in older homes, is at the joints of your heating/cooling ducts, which you can usually access through your basement or attic. Ironically, despite its name, “duct tape” is not the best product to use here because, according to Amann, it dries out and doesn’t maintain a good seal. She recommends “mastic,” which has the consistency of a paste, but hardens when it dries.

Replacing existing windows with energy-efficient ones doesn’t make sense unless you truly need new windows. The expense is much greater than the energy savings you’ll get. Moreover, the tax credit for installing energy efficient windows/skylights is limited to 10 percent of the cost, with a maximum credit of $200. Instead, pick up a roll of specially-designed clear plastic at the hardware store, cut it to fit your window and use a hair dryer to seal it in place, similar to shrink wrap. You’ll hardly know it’s there and when spring arrives, you can simply peel it off.

Wrap up your hot water heater for under $10. Encasing it in a “blanket” made for this purpose will help the hot water stay hot longer and significantly reduce the amount of work the heating element has to do. While you’re at it, check the temperature setting. Amann says “120 degrees should be adequate for all your household needs” and will have the added benefit of reducing the risk of scalding if you have children or older adults in the home. If your heater’s thermostat doesn’t allow you to set a specific temperature, you can get the same result by setting the dial between “Low” and “Medium.”

“In general,” says Amann, “each 10-degree reduction should save 3 to 5 percent in energy use.” For instance, lowering your hot water heater’s temperature from 140 degrees to 120 degrees will reduce the amount of energy used by 6 to10 percent. And don’t forget to turn the temperature to its lowest setting when you leave for vacation.

If your hot water heater is in your basement or some other unheated space, you can help the water retain its heat as it moves through the pipes by covering them with a simple foam wrapper that slides on.

Last but not least, as your light bulbs burn out, replace them with “compact fluorescent lights” (CFL). Amann recommends buying CFLs that carry the “Energy Star” label, which indicates they have gone through “more aggressive testing and quality requirements.” She says there have been “problems with cheap bulbs from overseas.”

If you’d like a copy of ACEEE’s “Consumer Guide to Home Energy Savings” send me an email with “Save Energy” in the subject line. Tell me how you’d use this guide or why you need it. Please keep your letters brief, and make sure to add a mailing address!

Hope this helps,

Gail

If you have a question for Gail Buckner and the Your $ Matters column, send them to: yourmoneymatters@gmail.com , along with your name and phone number.