Local 'Keystone HELP' from the American Recovery and Reinvestment Act

By Adam Eisman, GREENandSAVE.com
Posted on Thursday 12th March 2009

President Barack Obama signed the historical American Recovery and Reinvestment Act (ARRA) of 2009 into law less than a month ago. The ARRA allots $3.1 billion for the State Energy Program to help citizens and businesses to save energy. That $3.1 billion allows for $300 million in funds for state matching grants for consumer rebates on higher-tier energy efficient appliances.

The state of Pennsylvania has wasted no time in implementing their own version of this state-by-states stimulus by enacting the Keystone Home Energy-Efficiency Loan and Rebate Program (HELP). Keystone HELP offers eligible homeowners the opportunity for Tax Credits on new purchases of qualifying energy efficient appliances, as well as other home improvement projects that are at or above the required efficiency standards.

To be eligible for the Keystone Loan or Rebate one must be a Pennsylvania homeowner, who owns and is making improvements on their 1 to 2 unit primary residence that is also located in Pennsylvania. Lastly, the household has to have a combined income of less than $150,000. There are still options for those households making more than that amount, however they would have to apply for the HELP Renovate and Repair loan, whose terms are less favorable.

In addition to qualifying for the Loan or Rebate, those who accept these funds must also agree to the following:

  • Complete or provide data on your energy usage for completion of the Energy Star® Home Energy Yardstick or equivalent;
  • Grant access to your utility and fuel consumption data to the Department of Environmental Protection or its designees for 12 months from the date of your rebate or loan (not applicable for Renovate and Repair ENERGY STAR® Loan);
  • Complete a follow up survey in approximately 12 months from the date of your loan or rebate; and
  • If you are applying for financing under the Keystone HELP program, you must meet the credit eligibility standards of the program.

Once a homeowner has passed these hurdles, the program is fairly straightforward. For an Energy Star® Rebate, a homeowner who is installing a new, qualified Energy Star® appliance can receive 10%, up to $250, of the cost and installation of the appliance.* There is also an Advanced Performance Energy Star® Rebate, which may be awarded for installation of appliances or products that exceed Energy Star® standards. For this version of the rebate, the homeowner can collect the same 10% rebate, but up to $500, for the cost of the appliance and installation.

*Important: An eligible applicant is permitted to receive only one rebate OR loan during each fiscal year, which begins July 1.

Loans are a little more tricky, however if you qualify for Keystone HELP, the loans you will be offered are unsecured, which means collateral is not warranted. The basic Energy Star® Loan, which is for the purpose of installing qualified products that are Energy Star® or meet the programs standards, is for amounts between $1,000 and $15,000 with a 6.99% fixed rate and a 3, 5, or 10 year term. There are no fees or closing costs, nor is there a pre-payment penalty.

There is also an Advanced Performance Energy Star® Loan, which is for the installation of qualifying improvements that EXCEED Energy Star® standards. The loan amounts offered here are the same for the basic Energy Star® Loan ($1,000-$15,000), however the rate is a point lower at a fixed 5.99%, and you also have choice from the same terms of 3, 5, or 10 years.

For those households with a combined income of over $150,000, hope should not be lost. You can still qualify for a Renovate and Repair Energy Star® Loan, however the loan will be secured. The program will fund the installation of qualifying improvements that are Energy Star® rated or meet the program standards. Under the Renovate and Repair Energy Star® Loan, a homeowner can receive from $5,000 to $35,000 from the state. The interest rate on the loan will be between 6.375% and 8.875% depending on the loan term and the home’s value in relation to the loan; though up to 120% of the value of a home can be loaned. There are less than $400 closing costs, but that might be included in the loan, and again, there is no pre-payment penalty.

There is also the Whole House Improvement Loan for improvements that make the whole house more energy efficient. To secure this loan, the homeowner must have a certified Energy Audit to assess the health of the home. This Audit will recommend energy conservation methods and include an overall Home Energy Rating (HERS) index. For an improvement to qualify for this loan, the Auditor must predict a minimum decrease of 25% from an original HERS index of over 100, or a minimum decrease of 15% from a HERS index of below 100.

The unsecured version of this loan offers from $1,000 to $15,000 at a fixed interest rate of 4.99% with a 3, 5, or 10 year term. There are no fees or closing costs, or pre-payment penalties. You may be able to receive a $325 Energy Audit Credit to cover the expenses of the inspection.

The secured version of this loan offers from $5,000 to $35,000 at an interest rate between 3.875% and 6.375% and can include up to a 20 year term. The rate is based on the loan term and the home’s value in relation. Up to 120% of the home’s value can be loaned. This is similar to the Renovate and Repair Loan, as they both have less than $400 closing costs, which may be included in the loan. Also, there are no pre-payment penalties. The secured version of the Whole House Renovation Loan also includes a $325 Energy Audit Credit to cover the costs of the initial inspection.

There is a lot more to be said about the Keystone HELP Program, and an infinite number of intricacies that I cannot expound on further. For more information, please visit the Keystone HELP website, or you can find out more facts about which products are eligible to receive rebates or loans, Here.

GREENandSAVE.com is a free resource for anyone that wants to save energy, money, and the environment. The articles, product reviews, online tools, and return on investment calculations are researched from a diverse range of public and private sector sources. Overall, the company is passionate about saving money as well as creating healthy homes, offices, and lifestyles.

If you are not getting the Whole House improvement, it will definitely behoove any homeowner to check out the Return on Investment Table at GREENandSAVE.com before beginning any Green Home Remodeling project. Or, for an idea of how something simple, like a Low Flow Shower Head, can save you money on your utility bills, take a look at the facts.

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