Introduction

 

The Energy Policy Act of 2005 (EPAct 2005) includes a tax deduction for energy efficient buildings systems up to $1.80 per square foot for buildings designed for 50 percent energy cost savings relative to a building designed to and within the scope of ASHRAE 90.1-2001 Energy Standard for Buildings Except Low-Rise Residential Buildings. There are five alternative ways a building system(s) may qualify.

1. The whole building may qualify for up to $1.80 per square foot; or
2. Lighting systems; or
3. HVAC/water heating; or
4. Building envelope may each qualify for up to a $0.60 per square foot deduction for their contribution to the 50 percent savings (defined by the Internal Revenue Service as 16 2/3% whole buildings savings); or
5. Lighting may receive an up to a $0.30 to $0.60 deduction for reductions in lighting power density from ASHRAE 90.1-2001 tabular values of 25 percent to 40 percent respectively, with linear interpolation between 25 and 40 percent.

This online guide to the Energy Efficient Commercial Buildings Deduction provides a thorough description of this tax deduction provision, focusing on lighting aspects (for more information about the complete deduction, visit EfficientBuildings.org). On each page, a description of an aspect of the Commercial Buildings Deduction is provided in logical order, coupled in the right column by the actual language in EPAct 2005. Also provided is commentary, such as a summary explanation of what regulations have not yet been issued and how they might be addressed.

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