[bldg-sim] Tax Credit Question

Jamy Bacchus jamybacchus at nyc.rr.com
Tue Feb 6 09:38:56 PST 2007


After digging into EPACT 2005 last night I came up with another question
regarding the reference building's HVAC system. Here's the IRS excerpt from
"SECTION 3. Method of Computation".

3.03 Reference Building. For purposes of this notice, the Reference Building
is a building that is located in the same climate zone as the taxpayer's
building and is otherwise comparable to the taxpayer's building except that
its interior lighting systems, heating, cooling, ventilation, and hot water
systems, and building envelope meet the minimum requirements of Standard
90.1-2001. The energy performance of the Reference Building shall be
determined by following the methods for baseline building performance in the
PRM in Appendix G of Standard 90.1-2004. In calculating baseline building
performance, the Reference Building shall use the following additional
requirements from the 2005 California Title 24 Nonresidential Alternative
Calculation Method (ACM) Approval Manual:

For the full document go to:
http://www.irs.gov/pub/irs-drop/n-06-52.pdf

My interpretation is that the Reference Building (which is called "baseline
building" in App. G) would have the same HVAC system as the Proposed
Building with the exception that its efficiencies would be minimally
compliant with ASHRAE 90.1-2001. That is the HVAC of the Reference Bldg
would not be selected per Table G3.1.1A in ASHRAE 90.1-2004 App G. PRM is
only listed as a means of determining "energy performance" and not system
type.

Anyone else come to this conclusion or does anyone have clarification from
the Treasury Dept?

Cheers,
Jamy

JAMY BACCHUS, PE, LEED AP
jamybacchus at nyc.rr.com


  -----Original Message-----
  From: bldg-sim at gard.com [mailto:bldg-sim at gard.com]On Behalf Of Matthew
Dubrovich
  Sent: Monday, February 05, 2007 4:03 PM
  To: bldg-sim at gard.com
  Subject: [bldg-sim] Tax Credit Question


  A few things I've noticed in the IRS notice (
http://www.irs.gov/irb/2006-26_IRB/ar11.html ) ...



  Section 3 - Method of Computation notes that "The energy performance of
the Reference Building shall be determined by following the methods for
baseline building performance in the PRM in Appendix G of Standard
 90.1-2004"  (not 2001).  However, the Reference Building should meet the
minimum requirements of Standard 90.1-2001 plus some requirements of Title
24.  In part 2 of section 3, the IRS goes on to say that the 50% savings
should be calculated using only the Interior Lighting, Heating, Cooling,
Ventilation, and Hot Water components of the models.  There is no mention of
process loads which, according to 90.1-2004 App. G, should be included in
the savings calculation.  It appears that the calculation and model should
be based on a hybrid of 90.1-2001, 2004, Title 24, and some IRS-specific
requirements.



  Has anyone else come to the same conclusion based on what information we
have on this deduction?



  Also, it would be great to hear of any experiences with the deduction.



  Thanks,



  Matt Dubrovich



  EMC Engineers, Inc.

  www.emcengineers.com

  Making buildings work.  Better.

  Direct: (303) 974-1217

  (303) 974-1200

  (303) 974-1239 (fax)



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----------------------------------------------------------------------------
--

  From: bldg-sim at gard.com [mailto:bldg-sim at gard.com] On Behalf Of Lee
DeBaillie
  Sent: Monday, February 05, 2007 12:44 PM
  To: bldg-sim at gard.com
  Subject: [bldg-sim] Tax Credit Question



  Justin,



  I don't believe the guideline has been issued.  It appears to be the last
missing piece of information necessary to complete an actual certification
letter under the interim guidelines issued Nov06.  From what I can piece
together, because of this, you can do the energy analysis but you can't
actually apply for the tax deduction without a certification letter, which
requires among other things a building inspection conforming to the missing
guidelines.  Does anyone know of a successfully completed project?



  NEMA has protested this requirement to the US Treasury Department last
summer - see below.



  Lee

  +++++++++++++++++++++++++++++

  In a letter to the U.S. Treasury Department commenting on the IRS
guidelines, NEMA has taken the position: "The requirement of the Notice that
this field inspection be performed in accordance with NREL procedures is
unnecessary and inappropriate for the interim rule, which is independent of
energy-saving targets. Qualified individuals already exist that can inspect
an installation to assure that a lighting design that is consistent with the
prescriptive requirements of the interim rule has been installed in the
building. There is no need for new NREL requirements."

  As of August 21, Treasury has not responded to these comments in an
actionable manner.

  http://www.aboutlightingcontrols.org/education/papers/taxdeduction2.shtml

  ++++++++++++++++++++++++++++++


  >>> "Justin Aruck" <jaruck at emoenergy.com> 2/5/2007 12:43 PM >>>


----------------------------------------------------------------------------
--

  From: Justin Aruck [mailto:jaruck at emoenergy.com]
  Sent: Monday, February 05, 2007 1:11:19 PM
  To: bldg-sim at gard.com
  Subject: [bldg-sim] Tax Credit Question



  Does anybody know the status of the NREL "Energy Savings Modeling and
Inspection Guidelines for Commercial Building Federal Tax Deductions"  that
is supposed to be used to certify buildings for the commercial building tax
deduction?  It seems to be referenced all over the place, but I can't find
it.  Any help would be very much appreciated.



  Thank You,



  Justin Aruck, LEED-AP

  Project Manager

  EMO Energy Solutions, LLC

  2733 Hartland Road

  Falls Church, VA 22043

  Phone: 703-205-0445  x122

  Fax: 703-205-0449



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