Federal Tax Credit for Energy Efficiency on GeoThermal Heat Pump

A reminder that there is a Federal Tax Credit for Energy Efficiency on Qualifying GeoThermal Heat Pumps, with no cap. If you have been thinking about replacing these items, you might as well upgrade now and save some money.

For 2012, the Federal Tax Credit for energy efficiency for GeoThermal heat pumps is 30% of the cost (including installation/labor costs), with no upper limit . (2010 Federal Tax Credit information)

• Existing home and principal residence.   New construction and rentals do not qualify.

• Units must be placed into service by December 31, 2016.

Geo-thermal heat pumps are similar to ordinary heat pumps, but use the ground instead of outside air to provide heating, air conditioning and, in most cases, hot water. Because they use the earth’s natural constant heat, they are among the most efficient and comfortable heating and cooling technologies currently available.   This allows the system to reach fairly high efficiencies (300%-600%) on the coldest of winter nights, compared to 175%-250% for air-source heat pumps on cool days.

Units can cost from $5,000 to $10,000 installed and take about 5-10 years for payback.

All ENERGY STAR geo-thermal heat pumpsqualify for the tax credit.

Criteria for heat pumps:

Water-to-Air

·         Closed Loop: >=17.1 EER; >=3.6 COP

·         Open Loop: >=21.1 EER; >=4.1 COP

Water-to-Water

·         Closed Loop: >=16.1 EER; >=3.1 COP

·         Open Loop: >=20.1 EER; >=3.5 COP

 

·         Direct Geoexchange (DGX): >=16 EER; >= 3.6 COP

Energy Star has a store location finder to help you find local dealers.

The 2011 tax credit reverted to  2005-2008 levels. Anyone who previously took advantage of the program can’t apply for incentives that exceed $500.  IE If you claimed $500 between 2005 – 2008 on a previous energy efficiency project, or at least $500 tax credit from 2009 – 2010, you are ineligible for the 2011 energy efficiency tax credit.

If you used say $200 of the $500 energy efficiency tax credit from 2005 – 2008, and did not utilize the 2009 – 2010 energy efficiency tax credit, you would still have a $300 credit available.

Federal Energy Efficiency Tax Credit on Qualifying biomass fuel stoves or Wood Heat Stoves, Pellet Stoves, Fireplace Inserts.  There is also a Federal Tax Credit for Energy Efficiency on Water Heaters, Wood Heat Stoves, Pellet Stoves, Furnaces and Boilers, Geo-Thermal Heat Pumps, Windows, Doors, and Skylights.

Double dip! Local utilities like PG&E have their own rebates for Energy Efficient Appliances. To find out if rebates or other incentives are available in your area, visit the ENERGY STAR Rebate Finder.

See: Weatherize your home – Fix Leaky Ducts – Reducing Air Leaks

Related posts:

1. Federal Tax Credit for Energy Efficiency on Windows, Doors, Skylights
2. Federal Tax Credit for Energy Efficiency – Insulation
3. Federal Tax Credit for Energy Efficiency on Heating, Furnaces, and Boilers
4. Federal Tax Credit for Energy Efficiency – Water Heaters
5. Federal Tax Credits for Energy Efficiency – Air Conditioning, HVAC
6. Federal Tax Credits for Energy Efficiency – Wood Stoves, Pellet Stoves, Fireplace Inserts
7. Residential Wind Power Federal Tax Credit for Consumer Energy Efficiency
8. Federal Energy Tax Credit 2010 – AMT Exclusion Lifted

Posted on January 21st, 2012
If you enjoyed this post, be sure to subscribe to our RSS feed.