Energy Tax Incentive Section 179D
You may be eligible for a tax deduction of up to $1.80 per square foot for improving the energy efficiency of your existing commercial buildings or designing high efficiency into new buildings.
The Energy Policy Act of 2005: Includes a tax benefit for investments in energy-efficient commercial building property designed to significantly reduce the:
- Heating and Cooling elements
- Interior lighting energy
- Building Envelope
To be eligible, the energy efficient commercial building property must be placed in service between January 1, 2006 and December 31, 2007. Under Section 179D of the Internal Revenue Code for the proposed or newly installed: lighting upgrades, HVAC, hot water and building envelope, Advocates for Savings can perform the certification process and conduct this process in accordance to section 1331 of the Energy Policy Act of 2005, Pub. L. No. 109 58,119 Sta. 594 (2005) enacted Section 179 D of the Internal Revenue Code.
Who can benefit from the energy tax deduction?
- The person or organization that pays for construction. This is usually the building owner, but for some HVAC or lighting efficiency projects, it could be the tenant.
- Building or renovation must have been put into service after December 31, 2005.
- Building must be at least 40,000 sq feet to qualify.
Section 1331 of the Energy Policy Act of 2005 provides for and allows a deduction for energy efficient commercial buildings that reduce annual energy and power consumption by 50% compared to the American Society of Heating, Refrigerating, and Air Conditioning Engineers (ASHRAE) standard. A maximum deduction of $1.80 can be obtained if a reduction in energy consumption reaches 50%. Additionally, a partial deduction of $0.60 per square foot for building sub systems.
Partial Deduction: Owners of new and existing buildings (placed in service prior to the date of enactment) may earn a partial deduction of $0.60 per square foot per “system” for upgrading one or two major building Sub Systems.
Sub-Systems: Lighting, HVAC, Hot water and Building Envelope.
It Matters who You Hire
ADVOCATES FOR SAVINGS
Scope of Services
Advocates’ team of experts will conduct a physical inspection and perform an Energy Efficiency Study (EES) to calculate, determine and certify the allowable deductions for part or all of the cost of Energy Efficient lighting, HVAC, hot water and building envelope or any of these Sub-Systems that have been placed in service after December 31, 2005 and before January 1, 2008.
Interim Rules – Lighting: Interim rules (existing while the Secretary of the Treasury develops long term rules) establishes a deduction of $.30 per square foot for buildings “or portion of buildings” that achieve at least 25% lighting savings relative to the ASHRAE 90.1-2001 lighting power density (Watts per sq ft) requirements (but excluding ASHRAE’s (“additional lighting power allowances”) and that also uses bi level switching. This deduction increases progressively to $0.60 per square foot for using bi-level switching and achieving 40% lighting savings.
Method of Computation: The Performance Rating Method (PRM) must be used to compute the percentage reduction in the total annual energy and power costs with respect to combined usage of a building’s heating, cooling, ventilation, hot water and interior lighting systems as compared to the minimum requirements of standard 90. 1-2001.
ADVOCATES ENERGY EFFICIENCY STUDY (EES) PROCESS
- Initial data is gathered to evaluate the potential tax savings for implementation of EES and Certification.
- Once letter of Engagement is authorized, someone from our engineering team will visit the site/building and inspect equipment.
- Prescribed calculations will be made on the energy usage and proposed usage utilizing IRS approved software.
- The calculations, the Certification of approved and qualifying assets/equipment will be completed and the (EES) documenting the allowable credits will be delivered to the tax payer / owner.
Take The Shock Out Of Your Electric Bill
The Power To Control Your Cost Is Now In Your Hands
It isn’t everyday a business can cut one of a basic cost by twenty percent (20%).
But today just might be the day.
Before deregulation, businesses, of all sizes, received their electric service from one company that generated the electricity, transmitted and distributed it directly to the business. The generator also sold you and serviced your electricity account. Over the last ten years Illinois has been establishing an open energy market that allows businesses to choose the supplier that best fits their requirements of cost and benefit. The Illinois Commerce Commission continues to regulate the market insuring a safe and reliable supply of electricity.
New utility rules allow alternative electric companies to compete for your business. If you currently buy your electric from American Energy (AMEREN) or COM ED, then you have the power to choose your electric supplier and save money on electricity. Deregulated electricity gives the customer the power to choose their electric supplier and save on energy.
Utility bills for electricity now include one total price for generation, transmission, and distribution. Deregulation means the generation portion of the electricity service will be open to competition. Your local utility company will remain responsible for providing maintenance, customer service, and billing for the transmission and distribution of your electric.
A long time monopoly system of electric utilities has been replaced with competing suppliers. When competition is present in any market place, the end user benefits.
Want to get started saving money on your electric bill? Just provide us we a copy of one month’s electric bill and we will perform a NO RISK-NO COST comparison for you.
Once you decide to more forward we’ll do all the work necessary to get you the best rate possible.
ENERGY SAVINGS COMMONLY ASKED QUESTIONS
What is deregulation?
The deregulation of the electricity industry is similar to the deregulation of the oil and natural gas industry in that it divided the electricity business into three separate functions: production or generation, transportation or transmission and supply.
- Generation – the production of electricity, Supply – the sale of electricity
- Transmission/Distribution – the transportation from production to end user
Will I still be a customer of my utility?
Yes. The only difference is that you will also be saving money as a commercial customer of an Advocates for Savings resource. Your local utility owns the power lines that carry electricity to your business or organization and they will continue to bill you for the delivery of electricity at the rates governed by the state. The actual electricity will be supplied by an Advocates for Savings resource, an energy service company that constantly shops for the best wholesale prices to keep your cost down.
What if power goes out?
If you lose power or if you have an emergency related to your power, you must still notify your utility. Utilities are required to respond with equal attention to all of their customers and they do not and can not discriminate against customers that use energy service companies such as an Advocates For Savings resource.
Will I notice any changes to my service?
When you make the switch to our resource, your electrical service will continue uninterrupted. You will still have access to your usage and billing history appearing on your delivery bill from the utility.
Who is responsible for safety and reliability of power delivery?
The delivery system is still the responsibility of the utility and as such, its safety and reliability. The utility will maintain the lines and repair them if there is an outage or storm. The regulatory body overseeing utilities in Illinois will help to ensure that the utility continues to provide a safe, reliable delivery system for your use.
What if I have a question about my bill?
For questions regarding your bill for electricity, contact our resource and our friendly customer care team will be happy to assist you. For questions regarding the delivery of your service such as outages, meter checks, etc. please contact your local utility.
Why do we get two bills per month, one from your resource and one from our utility?
We are a supplier; you will continue to receive invoices from your local utility company for delivery and distribution.