Most of us want to save the environment, this is true. Saving money in the process doesn’t hurt either. Opting for energy efficient appliances and products is touted as being the best of both worlds. We draw less power from the grid, which in turn reduces demand for coal and other fossil fuels. We also see a benefit at tax time. Are these claims true or just the slick squawk of savvy salespeople?
From the Source
The desire to reduce dependence on fossil fuels is a great place to start in terms of motivation, but the leap ought not to be made directly to the appliance buying stage. Not yet, anyway. The first step is seeing if you’re able to opt for a green energy program through your utility provider.
Better yet, you may live in an unregulated market for energy, in which case customers can shop around for the best rate on a green energy buy-in. Folks living in many provinces and states in North America can view this website to compare prices among competing providers. Unfortunately, not everyone has this option but if saving money and energy are your goals, it’s worth having a look.
One of the biggest draws to buying energy efficient home appliances is hearing about the tax credits provided by the government. Yet few of us know much more beyond said “credit.” How much is it exactly? What qualifies and what doesn’t?
As far as the U.S. is concerned, there exists an array of federal income tax credits for energy-efficient purchases. For most basic home appliances and installations, it’s 10% of the cost up to $500 for each individual item. Bigger upgrades such as solar panels or a wind turbine result in a tax credit value of 30% of the cost with no limit.
Limitations are as follows: for basic energy-efficient appliances and installations, such as refrigerators and windows, the home must already exist, be the filer’s principal residence, and no rental properties count. Tax credits for the upgrades meant to harness alternative energy can be applied to new construction, but rental properties are still not qualified.
Savings Over Time
While the tax incentives for buying updated energy efficient appliances and installing fixture upgrades are a one-time deal, they do lead to significant savings in the pursuit of a lighter carbon footprint. However, this typically isn’t enough to persuade a money-conscious consumer to make big investments in new appliances when the old ones seem to work just fine.
The factor that typically seals the deal for folks when it comes to energy efficient appliance upgrades are the long term savings. The energy efficient water heater will lead to hundreds if not thousands of dollars saved in energy costs over the course of its life compared to lesser-designed models. The same goes with every energy efficient appliance. The savings are in the long run.
So to answer the question posed at the start – yes, energy efficient appliances really do deliver on their promises. However, it doesn’t do much good if you aren’t taking steps to get cleaner energy from your local energy provider. Once that’s out of the way, just make sure to keep your receipts for tax time to earn those energy-efficiency income tax credits. After that simply kick back and wait for the savings to accrue over time. It may seem like an abstract and unenjoyable reward, but your future self will thank you and the planet will too.