Bill’s Blog

If you are considering replacing your central air system this year you should consider using a heat pump rather than an air conditioner.

A heat pump will save the same amount a new central air system will, in the cooling season, but will save an additional 25% - 35% of your heating cost. On a call for heat the heat pump will run before the gas furnace and when the heat pump can not handle the load the heat pump will shut off and the gas furnace will run. In this area most heat pumps will handle the entire load of the house to about 30-32 degrees but this will vary from house to house. Below that it will need to supplement with the gas furnace and all control is done with a special thermostat.

This type of Hybrid Heat or Duel Fuel system will prolong the life of your existing gas furnace or with a new more efficient gas furnace lower your heating bills even further.

In the City Water Light & Power service area you will recieve an additonal rebate for using a heat pump. The cost difference between the air conditioner and heat pump can be offset by fuel savings in about one year once you factor in all the rebates and incentives.

Ameren has announced a rebate for high efficiency gas furnaces that are installed by Ameren trade ally contractors. The rebates (credit against the cost of installation) are $125.00 for gas furnaces with Annual Fuel Utilization Efficiencies (AFUE) between 90-95% and $200.00 for high efficiency gas furnaces with an AFUE 96% or above. The program will end December 16, 2009.

Ameren is also working on establishing rebates for central air systems and heat pumps so I will blog again when I find out it is happening.

The American Recovery and Reinvestment Act of 2009 has tax incentives for new energy efficient equipment installed in 2009.

High Efficiency Gas furnaces with an Annual Fuel Utilization Efficiency (AFUE) at or above 95%. High Efficiency central Air Conditioners with a Seasonal Energy Efficiency Ratio (SEER) at or above above 16 and  Energy Efficiency Ratio (EER) at or above above 13. Also high efficiency heat pump systems with a SEER at or above 15, EER at or above 12.5 and a Heating Seasonal Performance Factor (HSPF) at or above 8.5. These systems will qualify for a  tax credit of 30% of the cost with a $1500.00 cap for the credit.

Since this will end in 2009 now is the time to consider replacing your old equipment. This act also has other tax incentive on water heaters, windows and doors, insulation and many other energy saving options. To get more information go to energystar.gov.

A tax incentive for commercial applications of geothermal systems has been passed into law and will stay in effect until 12/31/2016. It is a 10% tax credit for total system cost with no limit to the total credit. It can be used to offset AMT tax, and can be used in more that one year. A 10% grant is available in lieu of tax credit. It can be used in combination of solar and wind taxes and can be combined with energy efficient building deduction.

It also has a 5 year MACR depreciation on the entire system and is eligible for 50% first-years bonus depreciation for 2009.

For a commercial building this can amount to a very large amount of money.

A income tax credit for residential geothermal systems installed through 12/31/2016 has been passed into law that provides a 30% income tax credit for the installation of a geothermal system in your home. With no cap on the credit this can be a substantial amount of money. It can be used to offset AMT tax, can be used in more than one year, can be combined with solar and wind tax credits and can be combined with energy efficiency upgrade credits.

With other rebates and some proposed rebates that I hear about this is the time to consider geothermal.

One job that I recently sold all the incentives amounted to 50% of the installed cost and can make it less expensive that a high end conventional system.