Obama pushes home efficiency rebates

By Steve Hargreaves, staff writer


NEW YORK (CNNMoney.com) -- President Obama was stumping once again Tuesday for his plan to reimburse homeowners who invest in energy efficiency and create jobs.

But the president's plan offered less money than had been previously hoped.

'It's going to be politically difficult to get this done," Obama said at a speech at Savannah Technical College in Georgia. "But it's the right thing to do."

The plan, officially known as Home Star, would give rebates of 50% up to $3,000 for energy saving purchases like new appliances, furnaces, or insulation.

Consumers would get the rebate from a store, contractor, or utility.

It would also offer a larger rebate for homeowners who performed a more comprehensive energy audit of their home. Under that plan, homeowners could be reimbursed for up to half the cost of hiring contractors to do things like add insulation, swap out old appliances, and caulk leaky windows and doors.

Rebates depend on a home's energy savings. Cut energy use by 20% and homeowners could get back half the money they shell out, up to $3,000. Homeowners who cut more than that might get up to $8,000, depending on how much they cut, according to people familiar with the plan.

A typical home energy audit and retrofit costs $5,000 to $8,000, and generally shaves 20%-40% off the monthly energy bills.

Unlike the Energy Department's Weatherization program, which is targeted to low-income people and has been criticized for taking too long to get going, this plan would be available to everyone.

The $8,000 rebate is less than the $12,000 proponents originally wanted, and the $6 billion proposed for the program is less than the $10 billion originally hoped for.

Nonetheless, environmentalists praised the idea.

"Even the most basic upgrade puts money in our pockets, puts Americans back to work and puts energy waste on the run," Lane Burt, manager of Building Energy Policy at the Natural Resources Defense Council, said in a statement. "It's a triple play on a more efficient future."

The program, dubbed "cash for caulkers" by some, has been touted by the president for months. It even won a mention in his State of the Union Address.

But whether it becomes reality is far from certain.

Congressional Democrats are also behind the idea and have said it is a part of their larger job creation strategy. But it was not included in a recent jobs bill, which focused more on extending current tax breaks rather than enacting new programs.

And it faces likely opposition from lawmakers concerned about rising government spending.

"Democratic leaders in Congress will still need to test the level of support for 'cash for caulker' programs relative to other jobs priorities," Whitney Stanco, an energy policy analyst at the brokerage firm Concept Capital, said in an e-mail.

The plan could appear in another jobs bill, or in separate energy legislation expected later this year.  To top of page

Index Last Change % Change
Dow 17,630.27 189.68 1.09%
Nasdaq 5,089.21 49.43 0.98%
S&P 500 2,093.25 25.61 1.24%
Treasuries 2.25 0.02 0.99%
Data as of 4:33pm ET
Company Price Change % Change
Bank of America Corp... 17.88 0.21 1.19%
Ford Motor Co 14.83 0.28 1.92%
AT&T Inc 34.33 0.01 0.03%
Freeport-McMoRan Inc... 12.33 0.96 8.44%
Micron Technology In... 19.76 1.64 9.04%
Data as of 4:01pm ET
Sponsors

Sections