Maximize your project budget with rebates and incentives

By Adam McMillen

Looking to save some money on your next project without sacrificing your sustainability goals? Utility rebates and other energy-based incentives can save thousands of dollars – allowing you to reduce your overall costs or apply the savings toward other parts of the project. It’s not always easy, however, to find these opportunities or to know how to apply them. Here are four ways to make the most of your project with utility rebates and incentives.

1. Know your sources

Most rebate programs offered by utility companies are either prescriptive rebates – your project must follow specific guidelines set by the utility company to be eligible – or custom rebates, which do not have guidelines and are calculated based on how much energy your project saves. Check with your local utility company to see what rebates they offer, as they all have different processes and standards.

Many local, state, and federal agencies also offer energy incentive programs in the form of rebates, tax incentives, or loans for qualified purchases. Check websites such as the Database of State Incentives for Renewables & Energy (DSIRE), which lets you search for policies and incentives by state, and ENERGY.GOV, which allows you to filter for renewable energy tax credits, rebates, and savings. According to, “Savings categories frequently include financial incentives for HVAC systems, water heaters, building insulation, appliances, weatherization, lighting, and other energy efficient improvements.”

2. Use ENERGY STAR rebates for appliances and equipment

Rebates are often provided by local utilities for ENERGY STAR certified purchases, which include appliances, building products, electronics, HVAC equipment, lighting, water heaters, and more. However, these are not automatic cost reductions – you receive reimbursement after paying the full amount. This could mean filling out rebate forms that become available right after purchase, or in some cases after installing the product. Use the Rebate Finder to search and compare a variety of ENERGY STAR products.

3. Save on lighting upgrades

Many utilities and state programs offer incentivesthat can make new energy-efficient lighting a more affordable option for your facility. For example, the Argonne National Laboratory upgraded lighting fixtures in five of their buildings with incentives from the Illinois Department of Commerce & Economic Opportunity, which covered nearly 30 percent of the project – equaling nearly $50,000 and saving the national lab $39,000 in energy use annually.

4. Embrace renewable energy

For those ready to make the commitment to renewable energy sources, rebates and tax credits can help make the transition smooth and budget friendly. Both federal and state incentives allow businesses to deduct a portion of solar costs from their taxes. Businesses using solar energy can receive a federal tax credit equal to 30 percent of the cost of their solar panel system, minus any cash rebates, which can also reduce costs by 10 percent to 20 percent ( Solar renewable energy certificates (SRECs) and performance-based incentives (PBIs) are additional ways to bring in extra income from your solar power system. Utilities will purchase the SRECs generated by your solar system and will pay business owners a kilowatt-hour credit for PBIs. Additionally, solar energy equipment may be eligible for a cost recovery period of five years under the Modified Accelerated Cost Recovery System (MACRS) – a method of depreciation that can become a financial asset for tax-paying entities that install solar.

No matter the size or scope of your project, you can benefit from energy incentives and rebates. With a variety of options, you could save hundreds, or even thousands, of dollars on your next project.

Energy incentive in action

The University of Iowa’s Football Operations Building and Indoor Practice Facility was part of Iowa’s Commercial New Construction (CNC) Program, which is funded by Alliant Energy, Black Hills Energy, and MidAmerican Energy Company to provide early analysis of HVAC system options and help the university achieve its sustainability goals. A MidAmerican Energy incentive of $743,200 resulted in an adjusted incremental energy investment construction cost of $875,604. With annual energy savings versus baseline projected at $356,157, the energy investments have a payback projection (with incentive) of 2.5 years. Learn more.

Categories: Design Tips | Sustainability