OLR Bill Analysis

HB 7432

Emergency Certification

AN ACT CONCERNING ELECTRICITY AND ENERGY EFFICIENCY.

SUMMARY:

This bill creates a rebate of up to $ 500 for people who replace their residential furnaces or boilers with more efficient ones. The rebate decreases as income increases in the same way as the property tax credit against the income tax. The bill caps the total amount of rebates at $ 5 million annually.

The bill requires the Energy Conservation Management Board to report to the Energy and Technology Committee on the cost-effectiveness of the rebate program by January 1, 2009.

Current law authorizes the issuance of up to $ 5 million in bonds for low interest energy efficiency loans. The bill, instead, authorizes the issuance of up to $ 5 million in bonds per year, and allows the proceeds to be used for the rebate program as well as the loan program.

EFFECTIVE DATE: Upon passage for the bond authorization; July 1, 2007 for the rebate program

REPLACEMENT FURNACE REBATE PROGRAM

Under the bill, between July 1, 2007 and July 1, 2017, the Office of Policy and Management secretary must provide a rebate of up to $ 500 for the purchase and installation of certain replacement home heating equipment. The rebate is available for equipment installed in residential structures containing up to four dwelling units. Replacement gas furnaces must be Energy Star rated and oil and propane equipment must be at least 84% efficient.

The amount of the rebate decreases with income. For taxpayers who file under federal income tax as married individuals file jointly whose Connecticut adjusted gross income (AGI) exceeds $ 100,500, the rebate decreases by 10% for each $ 10,000, or fraction thereof, by which the taxpayer's AGI exceeds this amount. For taxpayers who file as a married individual filing separately whose AGI exceeds $ 50,250, the rebate decreases by 10% for each $ 5,000, or fraction thereof, by which the taxpayer's AGI exceeds this amount. For heads of households whose AGI exceeds $ 78,500, the rebate decreases by 10% for each $ 10,000 or fraction thereof, by which the taxpayer's AGI exceeds this account.

In the case of taxpayers who file as unmarried individuals, the rebate baseline decrease varies by year. In income year 2007, the rebate is reduced by 10% for each $ 10,000 or fraction thereof the taxpayer's AGI exceeds $ 55,500. The baseline increases to $ 56,500 in 2008, $ 58,500 in 2009, $ 60,500 in 2010, $ 62,500 in 2011, and $ 64,500 in 2012 and thereafter.