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Tax Breaks for Efficient HVAC Systems Extended

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HVAC , construction , energy efficiency , operating costs , green design .

I’m Ed Sullivan, editor of Building Operating Management magazine. Today’s topic is the fate of tax breaks for very efficient HVAC systems.

For the past few years, federal law has allowed tax deductions for the installation of extremely efficient HVAC systems. Under the original version of the Energy Policy Act of 2005, known as EPAct, new or upgraded HVAC systems that were at least 16.7 percent more efficient than required by ASHRAE 90.1-2001 could qualify for tax deductions of up to 60 cents per square foot.

That deduction was set to expire at the end of 2008. Although there was widespread support for an extension, the measure was stalled in Congress.

But the EPAct extension finally did pass, as part of the financial bailout bill approved by Congress. The deduction is now available until Dec. 31, 2013. That five-year window provides ample opportunity for facility executives considering very efficient HVAC systems to take advantage of the tax break. That planning time is important, because of the fairly demanding requirements that must be met to gain the deduction. If an HVAC project will be using energy modeling, for example, in a building aiming for LEED certification, it’s worthwhile to investigate whether the project will qualify for the tax break.