Thursday, May 14, 2009

Tax Credits for Green Initiatives

I'm not going to pretend I know a lot about this topic. I don't. I only know about a few of the credits that are available, and I don't know all the pros and cons involved. So I'm just going with my gut feeling here.

And along with a general animosity towards the Italian Sausage sandwich I shoveled into it a few hours ago, my gut is telling me that tax credits geared towards the adoption of green initiatives are a very positive thing.

Here's a good example. I've been wanting to put in new windows here at our new place, but I've put it off because of the cost. Even doing the installation myself, the cost has been prohibitive, given that the money could be used for more pressing matters. But now there's a tax credit worth up to $1,500 which you can nab by installing approved energy efficient windows and doors. You can take 30% of the total cost of the job right off your tax bill, up to $1,500. It's a credit, not a deduction, so you get the full dollar value in your pocket. It's essentially a 30% off coupon. That's huge! The window job has now vaulted its way to the front of the line.

So I get a large discount on a job I wanted to do anyway, and afterward I start saving money on my utility bills. Win win...and win. I use less energy, my carbon footprint drops, and a little less bad is perpetrated on our unsuspecting planet. As more people take advantage of the credit, the savings effect swells geometrically. A lower power demand countrywide makes power generation with renewable energy sources, which are generally less predictable than coal powered plants, more feasible. Less reliance of carbon spewing power generation technologies further reduces carbon emissions. Like sharks to chum, once we Americans get a taste for the blood which is energy independence, we will feast to completion.

People, first and foremost, think with their wallets. Expensive green initiatives will never catch on. You have to couch them in terms of saving money. That's the quickest way to get people to hop on board. Then make sure they enjoy the ride and we can make real progress.

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