Just when you thought the government was done giving out free money, here comes another round of economic stimulus funded payments in what is being dubbed the Cash for Appliances Program (in honor of the wildly successful Cash for Clunkers CARS program). The $300 Million program, managed by Department of Energy (DOE) but run by the states, provides rebates to consumers for the purchase of new ENERGY STAR qualified home appliances. The appliance industry, reeling from the recession and a drop in sales, is also very supportive of the program in hopes that the rebates will provide a much-needed sales boost.

“Appliances consume a huge amount of our electricity, so there’s enormous potential to both save energy and save families money every month,” said Energy Secretary Chu. “These rebates will help families make the transition to more efficient appliances, making purchases that will directly stimulate the economy and create jobs.” The Recovery Act appropriated funds for the program to help achieve the national goals of spurring economic growth, creating jobs, saving energy and reducing greenhouse gas emissions.

The new funding will be awarded to states and territories, through their energy offices, using a formula set forth in the Energy Policy Act of 2005. Each state or territory is required to submit a plan that specifies which ENERGY STAR appliance categories will be included in their rebate program, the rebate level for each product type, how the rebates will be processed, and their plan for recycling old appliances. States and territories must first file an initial application expressing their intent to participate by August 15, 2009, followed by a full application by October 15, 2009. States and territories can use these funds to leverage the utility companies and energy efficiency program sponsors in their area.

This program will also leverage the power of the ENERGY STAR program, a well-known appliance labeling program of the U.S. Environmental Protection Agency and the U.S. DOE, that helps consumers make energy smart choices by identifying the most energy efficient products.

Rebate Checks and Eligible Appliances

Unlike the CARs program, there's no trade-in required for old appliances - which some critics say make it a less effective poor program. Rebate checks (in the $50 to $200 range) will be issued whenever a qualifying appliance is purchased once the program is live (in fall 2009). States have the flexibility to select which residential ENERGY STAR qualified appliances to include in their programs and the individual rebate amount for each appliance, with the DOE recommending that states and territories focus their program efforts on heating and cooling equipment, appliances, and water heaters as these products offer the greatest energy savings potential. ENERGY STAR qualified appliance categories eligible for rebates include: central air conditioners, heat pumps (air source and geothermal), boilers, furnaces (oil and gas), room air conditioners, clothes washers, dishwashers, freezers, refrigerators, and water heaters.

The program is expected to be operational later this year - October 2009 onwards. Consumers thinking of buying household appliances should check with their state's energy department for more details and eligibility criteria.

I will continue to provide updates on this rebate and encourage you to subscribe (free) via Email or RSS to get the latest news.

Photo : Jim O'Connell

Related:

~ $800/$400 Working Tax Credit
~ $8,000 New Home Buyer Credit (Extended to 2010)
~ 3 Stimulating Reasons to Buy a New Car
~ Stimulus Payments in 2010 & 2011
~ Food Stamps Stimulus
~ Green Energy Home and Auto Tax Credits in the 2009 Economic Stimulus Package