While Consumers Find Higher Energy Bills Taxing, Survey Finds Few Take Advantage of Federal Energy Efficiency Tax Credit

DENVER--(BUSINESS WIRE)--Following large increases in home energy costs in 2005 and 2006, and with many experts predicting indefinite energy cost increases, homeowners may not be doing everything they can to alleviate the burden of high home utility bills. A new survey of 1,040 American adults conducted for building products manufacturer Johns Manville by Opinion Research Corporation reveals that while a high percentage of homeowners (74 percent) were aware of the federal tax credit available under the Energy Policy Act of 2005, relatively few (23 percent) took advantage of it for their 2006 taxes. This despite the fact that 78 percent of homeowners reported that their 2006 heating/cooling costs increased 5 percent or more than their 2005 costs, and only 32 percent believe that their home is already energy efficient.

“Energy costs are volatile, and as the world’s consumption of energy continues to increase, energy bills are expected to increase,” said Kateri Callahan, president of the Alliance to Save Energy. “Reducing our consumption is the quickest, most cost effective and cleanest way to extend our world's energy supplies. Homeowners can directly help the situation, and themselves, by making energy efficiency upgrades to their homes. It’s a win-win situation.”

The Energy Policy Act of 2005 allows for a tax credit of up to 10 percent of the cost of materials for certain home improvements, such as installing Energy Star-qualified windows and air conditioners, or installing insulation and air sealing products. The law, which offers a tax credit of up to $500 per household, was created in response to record high energy prices. According to the U.S. Energy Information Administration’s recently released Annual Energy Outlook 2007, energy prices are expected to increase steadily through 2030. The tax credit was available for the 2006 tax season, and homeowners can still take advantage of the credit with purchases made through December 31, 2007.

According to the Johns Manville survey, of the homeowners who took advantage of the tax credit, the most popular energy efficiency upgrade was adding insulation or air sealing (44 percent), closely followed by installing Energy Star-certified windows (40 percent).

The data shows consumers are recognizing the economical benefits of adding additional insulation, and with good reason. According to the Harvard University School of Public Health, more than 60 percent of homes in the U.S. are under-insulated, and adding products such as attic insulation is one of the most cost-efficient ways to improve the energy efficiency of a home. The U.S. Department of Energy estimates that 40 percent of all air leaks in the average home are in the attic, and homeowners can expect to see up to a 30 percent savings on heating and cooling costs with a well-insulated and air-sealed home.

A simple way for homeowners to check if their home is properly insulated is to measure the amount of insulation in their attic. By using a ruler, homeowners can check the depth of their attic insulation. Many climates may need up to 19 inches of insulation to ensure maximum energy efficiency.

“There are numerous reasons why adding insulation to your home is a smart decision,” said Mike Lawrence, vice president and general manager for Johns Manville’s Insulation Systems business. “In addition to the energy bill savings, adding insulation makes your home more comfortable for you and your family by eliminating drafts and hot spots. Also, inefficient homes consume more fossil fuels, and in turn, increase the amount of greenhouse gasses emitted into the atmosphere.”

The Johns Manville survey found that 39 percent of homeowners are planning to take advantage of the tax credit for their 2007 taxes. For those homeowners choosing to install insulation, there are several options available for completing the job. Installing insulation in an attic with products such as Johns Manville’s ComfortTherm® can be an easy do-it-yourself weekend project, requiring only basic tools and almost no prior home improvement experience. Because ComfortTherm® is fiber glass wrapped in plastic, homeowners receive all the benefits of installing a fiber glass insulation product without having to directly handle the material.

Homeowners can also hire an insulation contractor to complete the project; however installation costs cannot be deducted as part of the energy tax credit. To find more resources on insulation installation, including a list of needed tools, building codes for specific geographic regions and contractor referrals, homeowners can go to CheckYourFill.com. Home energy efficiency upgrades must be made by December 31, 2007 to qualify for the federal tax credit.

“Savvy homeowners will realize that insulation upgrades quickly pay for themselves,” said Lawrence. “There’s also an economic benefit when it comes time to sell your home. According to the U.S. Energy Information Institute, adding insulation and air sealing increases your home’s resale value, and 55 percent of Americans are willing to pay more for energy-efficient home features.”

In addition to energy savings and increased comfort, the type of insulation homeowners select can make a significant difference in the quality of a home’s indoor environment. Insulating with Johns Manville Formaldehyde-free™ fiber glass insulation improves indoor air quality because it’s the only insulation made without formaldehyde. And with the average American spending up to 90 percent of their time indoors, the U.S. EPA recommends limiting exposure to formaldehyde as much as possible.

About Johns Manville

Johns Manville, a Berkshire Hathaway company, is a leading manufacturer and marketer of premium-quality building and specialty products. In business since 1858, the Denver-based company has sales in excess of $2.5 billion and holds leadership positions in all of the key markets that it serves. Johns Manville employs about 8,500 people and operates 43 manufacturing facilities in North America, Europe and China. Additional information can be found at www.jm.com.

About the Survey

The 2006 Energy Efficiency Tax Credit survey was conducted by Opinion Research Corporation for building products manufacturer Johns Manville. The survey was conducted via telephone April 27-30, 2007 and contacted 1,040 U.S. adults 18 years of age and older, living in private households in the continental United States. Most results are based on a smaller sample of 769 homeowners. Using Opinion Research’s CARAVAN methodology, the data was collected from a national probability telephone sample, a form of random-digit-dialing (RDD). Respondents were asked six questions regarding their awareness and utilization of the 2006 Federal energy efficiency tax credit, their plans for future energy efficiency home improvements and their plans to take advantage of the credit for the 2007 tax season.