As the 2010 congressional legislative session begins, an extraordinary number of proposals are under consideration that would positively impact the HVAC/R industry with respect to producing and selling energy efficient products. As Congress tries to spur job growth and stimulate the economy, manufacturers and consumers could be the beneficiaries. AHRI has been working closely with the Congress, other industry groups, and environmental advocates to ensure that policy makers have the information they need to make informed decisions on these issues. Among the proposals under consideration:

Commercial and Residential HVAC Incentives: Two incentive packages, one each for residential and commercial products, are being developed by a coalition of environmental and industry groups, including AHRI. Dubbed Home Star and Building Star, the proposals are designed to provide incentives, probably in the form of rebates from state energy agencies, for the sale of energy efficient home and building products, and for energy efficient building designs.

The Home Star proposal includes incentives to consumers to purchase energy-efficient heating, cooling, and water-heating products, among other energy-efficiency improvements. In its current form, the bill would provide a rebate to consumers for each improvement made, up to a total of $4,500. The efficiency levels for each product category have yet to be determined.

The Building Star proposal also would provides for rebates, but for the sale of commercial HVAC products, with the rebate amount varying upon the efficiency and capacity of the product. It would also include language accelerating the depreciation period for certain commercial HVAC/R equipment. Both of these proposals have been presented to Capitol Hill staff for their review, with the goal being to have them be included in “jobs” legislation expected to be introduced shortly in the House and Senate. Energy Efficiency Tax Incentives: H.R. 4226, the Expanding Building Efficiency Incentives Act, introduced by Rep. Dave Reichert (D-WA), would establish a $5,000 credit when specific steps are taken to improve energy efficiency in a new home. The bill would also increase from $1,500 to $5,000 the current maximum tax credit available to homeowners for energy-efficiency improvements, and would provide a $200 tax credit for home energy audits. It would increase the deduction for energy-efficient upgrades to commercial buildings from the current $1.80 per sq. ft. to $3 per sq. ft. Reichert’s bill has been endorsed by the White House, which significantly improves its chances of passage or inclusion in another piece of legislation.

Best-in-Class Proposal: At the same time, AHRI is working with the appliance industry, retailers, and environmental groups on a “Best-in-Class” rebate proposal that would include incentives for the sale and installation of HVAC/R equipment that meets efficiency specifications to be developed by the Department of Energy. The House already passed a version of this bill, but it did not include AHRI members’ products. The pending Senate version does not cover yet cover them either, but we are working with Senate staff and others to see if that can be accomplished.

AHRI’s initial success with these activities is a direct result of the trust we have established in recent years with environmental advocacy groups. In recent years, we have cultivated a relationship with these groups, bringing them together with our members in semi-annual workshops to share information and work together to achieve common goals.

A prime example of that cooperation is the landmark agreement we signed with those groups in October that will, if enacted by Congress, establish for the first time regional efficiency standards, beginning in 2013, for residential space heating and cooling and water heating equipment.

The agreement also would allow states to include even higher efficiency levels for heating and cooling, systems in new homes. This new approach strikes a balance between the desire for greater state and regional flexibility and the need for a uniform marketplace, and it looks to the nation’s long-term energy future by supporting the most efficient new systems where they are most cost-effective.

AHRI is working with House and Senate staff and others to ensure that the language from this agreement is included in one of the bills discussed above. AHRI looks forward to working with our industry allies and others this year to improve energy efficiency and environmental stewardship, while ensuring the comfort, safety, and productivity of our customers.