Saving energy is good. Convince homeowners to install energy-saving home improvements by throwing some rebates their way. Contractors get the work. The homeowners and the country save energy. Everybody wins, right?
Leave it up to Congress to do this and the result gets Kafkaesque.
The U.S. House of Representatives has passed its version of the Home Star Energy Retrofit Act of 2010. The Senate version, S.3434, is still in committee. Either version will be troublesome for contractors. The House version would send the rebate money to homeowners, but the Senate bill would make contractors front them the money, then wait to get repaid by "rebate aggregators." Both bills would require contractors to be accredited by the Building Performance Institute, Malta, N.Y., even though 85% of the BPI accredited contractors are in New York and New Jersey.
The legislation has two levels, Silver and Gold. Silver is pretty simple. A homeowner invests in an energy-efficient home improvement, such as an Energy Star rated water heater or a condensing boiler, and they get money back. The Silver Star program maxes out at $3,000 or 50% of the project's value. The real money is in Gold Star, which requires energy performance analysis and modeling. Gold Star pays up to $8,000.
The legislation sounds like a great idea — make American homes more energy efficient, and provide much-needed jobs in the construction industry. The doing is another matter. What about those rebate aggregators who would send the money to contractors? Within 30 days? Really? And who would those people be? It sounds like an invitation to scam artists who are adept at filling out federal forms.
Perhaps most troubling is the requirement that contractors performing Gold Star work be accredited by BPI. How did they get entrenched in the legislation, I asked Tom Meyer, P.E., director of government and professional relations for The ESCO Group. Meyer replied that they have a really good lobbyist with friends at the Department of Energy.
The section of the bill that calls for providing good paying green jobs to the unemployed or under-employed or under-privileged sounds to me like wishful thinking. The tenets of this bill are so complicated that it will require smart, experienced contractors with a background in government contracting rules to do the work. I don't see them hiring a bunch of people with no experience.
Here's some language from the bill that "explains" how to calculate Gold Star rebates:
"(II) in the case of any residence with a rating system score which is lower than that which corresponds to such IECC [International Energy Conservation Code] Standard Reference Design by no less than 5 points, $500 for each 5 points by which the rating system score which corresponds to such IECC Standard Reference Design exceeds the rating system score of such residence (in addition to the amount provided under clause (i), if applicable)."
We’ll post a PDF of S.3434 on our website so you can read the bill yourself.
The legislation is opposed by the Air Conditioning Contractors of America. Meyer says the Radiant Panel Association, National Association of Oil Heat Service Managers, and the United Association of Plumbers & Pipefitters also take issue with the bill.
I've heard two completely different opinions on the prospects for this legislation. A bunch of organizations, such as the International Code Council, are part of a coalition known as the WATER coalition, which is lobbying to get water conservation measures inserted into the Home Star bill. Washington lobbyist Patrick O’Connor, Kent & O'Connor Inc., said the Senators with whom he’s talked are receptive and he is optimistic that the water provisions will make it into the bill. O'Connor also believes that the bill will get to the Senate floor for a vote before the August recess.
Meyer, on the other hand, thinks the bill may remain stuck in committee. The bill calls for $6 billion in new spending to fund the program with no sources of revenue. In a political climate where the Senate won't even extend unemployment insurance benefits, Meyer doesn't see them voting for anything that's not paid for.