This year’s stimulus bill funded a $300 million program that will offer rebates of varying amounts – possibly up to $200 – to buyers of energy-efficient appliances and other products that carry the “Energy Star” label.
The rebate programs are being run by the states, and the details are still being worked out. But unlike Cash for Clunkers, you probably won’t have to drag your old stove into the store to get money for a new one.
Here are some questions and answers about the rebates.
Q. What is this program, and why haven’t I heard much about it yet?
A. There hasn’t been much talk of the program yet because it’s still taking shape.
Here’s what we know: The government has set aside about $300 million for states to use to give out rebates to buyers of energy-efficient appliances.
Q. When will this start?
A. States had to send letters saying they wanted to participate to the Department of Energy by Aug. 15.
Soon, they’ll start to receive 10 percent of their funding allotments, which department spokeswoman Jen Stutsman said will be used to help develop the programs.
Plans for the programs – including which products qualify and how much the rebates will be worth – are due back to the federal government by Oct. 15.
The Department of Energy estimates that the full $300 million will be awarded by the end of November, and consumers should start to see the rebate programs in stores later this year or early next year.
Q. How much money is being awarded to each state?
A. The allocation is based on population, working out to roughly $1 per person per state. So California’s allotment is the biggest, with nearly $35.3 million.
Q. What will the average rebate look like?
A. The Department of Energy won’t give a number, because it says it won’t know what the states’ plans are until mid-October. But the appliance industry’s trade group, the Association of Home Appliance Manufacturers, said consumers should expect to see rebates of between $50 and $200.
Q. Is this a new idea?
A. Yes and no. An energy rebate program was first included in the Energy Policy Act of 2005, but it was never funded until this year’s stimulus bill.
From the Department of Energy’s perspective, this is a new federal program. But the trade group estimates that 25 states already have their own rebate programs.
Q. What’s the thinking behind the program?
A. Similar to the clunkers program – which gave car buyers up to $4,500 if they turned in a gas guzzler for something more efficient – the goals are to stimulate the economy and improve the environment.
The rebates might spur new appliance sales, which would help an industry that’s been struggling.
The Department of Energy says it hopes the program will ripple throughout the economy by saving families money on their energy bills and by creating jobs and helping businesses.
As for the environment, replacing old appliances with new, efficient ones means less energy is required to operate them. The Department of Energy recommends that states focus their programs on rebates for heating and cooling equipment, appliances and water heaters.
Q. Aren’t most of the manufacturers of these products overseas? How will this help America?
A. Everyone involved is going to benefit from the additional sales – from stores selling the appliances to delivery people who will get a tip when they bring home that new stove.
And consumers will be saving money on the purchases and on their energy bills, which frees up cash to spend elsewhere.
Q. How do I know which products qualify for the program?
A. Pay attention to your state’s details when they are announced for the types of products that will qualify. But generally, just look for the blue “Energy Star” sticker.
You won’t have to look too hard.
The appliance manufacturers’ trade group said 55 percent of the products its members make carry the label.