Monday, August 31, 2009

Appliance Rebate Program Gives the Environment and Economy Another Boost

After Cash for Clunkers, here comes Dollars for Dishwashers.

The U.S. Department of Energy has set aside $296 million to pay for rebates to consumers who buy qualified energy-efficient appliances. The money will be distributed to states according to a formula published in the Energy Policy Act of 2005. To see how much your state will receive, click here (pdf).

Appliances Covered by the Program
The DOE has recommended that states focus on 10 categories of appliances that qualify for the ENERGY STAR® label. These are:
  • central air conditioners
  • heat pumps (air source and geothermal)
  • boilers
  • furnaces (oil and gas)
  • room air conditioners
  • clothes washers
  • dishwashers
  • freezers
  • refrigerators
  • water heaters
States can, however, pick whichever categories and models they want. They also have flexibility in setting rebate amounts.

The DOE has set a deadline of Oct. 15, 2009, for states to submit their final plans including the list of appliances they want to cover. The appliance rebate program will be mostly funded by Nov. 30, 2009. Shoppers can expect to receive their cash later this year or early next year.

No Trade-In
Consumers won't have to trade in their old appliances. They will simply receive a rebate when they buy a qualifying new one.

Manufacturers Want Uniformity
Manufacturers want uniform rules nationwide for models and rebates. I agree with them. A patchwork of different state directives will make it difficult to advertise and sell the appliance rebate program to consumers, and complicate administration.

Appliance retailing is split between national chains like Home Depot and Sears, and local independent stores. But local stores buy through regional or national purchasing co-ops, so most appliance ordering is done at a large scale.

Knowing rebate amounts on specific appliances will help the industry better predict demand. Manufacturers can then set production targets accordingly.

But whether the details are decided at the state or national level, I'm sure the appliance rebate program will be a success.

Appliance retailers are old hands at advertising rebates. Count on ads to start popping up on TV screens and newspapers.

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