[Bldg-sim] EPACT - more questions (UNCLASSIFIED)

Eurek, John S NWO John.S.Eurek at usace.army.mil
Tue Oct 4 08:26:16 PDT 2011


Classification: UNCLASSIFIED
Caveats: NONE

Wow, I can't believe you would suggest that environmentalist would pass laws
and regulations without fully thinking out all the issues and ramifications.
Are you suggesting it was a knee jerk reaction? I'm sure there was a
consensus when they passed the regulation and you can't get more scientific
than that.

Now go put a mercury light bulb in your children's room, take a nice shower
with a low flow head, flush the low flow toilet 3 times to get it to work, go
for a ride in a fuel efficient rolling coffin and prepare for global warming.

Your big brother will take care of everything.



"Is Freedom a small price to pay to stop Global Warming?"

John Eurek




-----Original Message-----
From: bldg-sim-bounces at lists.onebuilding.org
[mailto:bldg-sim-bounces at lists.onebuilding.org] On Behalf Of Andrew Craig
Sent: Tuesday, October 04, 2011 9:24 AM
To: Nick Caton; Josh Howes; bldg-sim at lists.onebuilding.org; R B
Subject: Re: [Bldg-sim] EPACT - more questions

I would just add that the 10% makes a lot more sense than the previous
benchmark.  We haven't had a project that came that close to 16-2/3% savings
on the envelope, even with very high performance construction.  I suppose the
more extreme the climate the better chance you have of hitting that
benchmark...but it seems like the threshold wasn't fully thought out when the
regulations were first written.

 

Andrew Craig PE, LEED AP
Project Mechanical Engineer

INTERFACE ENGINEERING
email andrewc at interfaceeng.com <mailto:andrewc at interfaceeng.com> direct
503.382.2696

www.interfaceeng.com <http://www.interfaceeng.com/> 




 

From: bldg-sim-bounces at lists.onebuilding.org
[mailto:bldg-sim-bounces at lists.onebuilding.org] On Behalf Of Nick Caton
Sent: Tuesday, October 04, 2011 7:16 AM
To: Josh Howes; bldg-sim at lists.onebuilding.org; R B
Subject: Re: [Bldg-sim] EPACT - more questions

 

Hi Josh!

 

I took this as a sign that I need to freshen up on the recent
legislation/clarifications... I found the 20% reference, but I'm finding
something a bit more nuanced than a blanket 20%:

 

Ref: IRS Notice 2008-40 (http://www.irs.gov/irb/2008-14_IRB/ar12.html),
Section 7:

 

.01 Energy Savings Percentages. A taxpayer may apply section 2.05 of Notice
2006-52 by substituting "10" for "162/3" in section 2.05(1) of such notice.
If a taxpayer makes this substitution, the taxpayer must apply sections 2.03
and 2.04 of Notice 2006-52 by substituting "20" for "162/3" in sections
2.03(1)(a) and 2.04(1) of such notice. If § 179D is extended beyond December
31, 2008 [insert: it was, until December 31, 2013, by the same legislation
introducing the TARP], the Internal Revenue Service and the Treasury
Department expect, in the absence of other changes to § 179D, that the
substitute percentages set forth in this section will be the only percentages
used in determining whether property placed in service after December 31,
2008, is partially qualifying property.

 

Having gone back and revised my copy of 2006-52 per the above, my
interpretation is that improvements put into service after 2008 need to
demonstrate a 20% improvement for lighting and/or HVAC, but only 10% for
envelopes.

 

Partially qualifying installations put into service after December 31, 2008
have to submit for deductions using the 20/20/10 benchmarks.  Anything prior
has the option of submitting under either set.

 

That said, is there more recent legislation or an IRS "clarification" (haha)
that mandates 20% for envelopes as well?

 

~Nick

 

cid:489575314 at 22072009-0ABB

 

NICK CATON, P.E.

SENIOR ENGINEER

 

Smith & Boucher Engineers

25501 west valley parkway, suite 200

olathe, ks 66061

direct 913.344.0036

fax 913.345.0617

www.smithboucher.com 

 

From: bldg-sim-bounces at lists.onebuilding.org
[mailto:bldg-sim-bounces at lists.onebuilding.org] On Behalf Of Josh Howes
Sent: Monday, October 03, 2011 3:47 PM
To: bldg-sim at lists.onebuilding.org; R B
Subject: Re: [Bldg-sim] EPACT - more questions

 

Rohini,

 

We specialize in EPACT studies.  The IRS legislation is very complicated and
vague.  However, to answer your questions:

 

1) Nick is correct.  If you cannot get to 50% with your model by combining
all the improvements (HVAC, lighting, and envelope), then you must model them
separately.  Remember, your baseline is not the building prior to the
improvements.  Your baseline is an ASHRAE 90.1-2001 baseline.

2) You are looking for 20% improvement on building improvements placed into
service in 2008 or later.  The 16 2/3% benchmark is only for years 2006 and
2007.

3) Nick is again correct.

 

We would be happy to work with you on future EPACT studies.  Best of luck.

 

--------

Joshua D. Howes, PE

Concord Energy Strategies

(502) 384-9078

www.concordenergystrategies.com

 

IRS Circular 230 Disclosure

To ensure compliance with requirements imposed by the IRS, we inform you that
any U.S. federal tax advice contained in this document is not intended or
written to be used, and cannot be used, for the purpose of (i) avoiding
penalties under the Internal Revenue Code, or (ii) promoting, marketing, or
recommending to another party any transaction or matter that is contained in
this document.

 

 

 

 

From: "Nick Caton" <ncaton at smithboucher.com>

Subject: Re: [Bldg-sim] EPACT - more questions

Date: October 3, 2011 1:29:06 PM EDT

To: "R B" <slv3sat at gmail.com>, <bldg-sim at lists.onebuilding.org>





Hi Rohini,

 

I haven't actually put together a final set of documentation for the modeling
approaches, but having scoured the legislation & IRS clarification docs at
one, here's my current understanding:

1.      "Running the proposed with both these systems as upgrades gives me
~40% cost savings."  ß This means the whole building approach is out (<50%).
You have to model the lighting/HVAC/envelope improvements independently
("partially qualifying").

2.      For each independently modeled component (lighting/HVAC/envelope)
that pushes savings past the 16-2/3% improvement mark, you get to claim
$0.60/SF for the deduction.  

3.      The improved HVAC run will not benefit from any lighting/envelope
improvements for these partially qualifying runs, and so on.  

 

Not sure I recall a 20% improvement figure as part of the requirements, but I
haven't brushed up on the particulars in a good while.

 

~Nick

 

<image001.jpg>

 

NICK CATON, P.E.

SENIOR ENGINEER

 

Smith & Boucher Engineers

25501 west valley parkway, suite 200

olathe, ks 66061

direct 913.344.0036

fax 913.345.0617

www.smithboucher.com <x-msg://225/www.smithboucher.com>  

 

From: bldg-sim-bounces at lists.onebuilding.org
[mailto:bldg-sim-bounces at lists.onebuilding.org] On Behalf Of R B
Sent: Monday, October 03, 2011 11:48 AM
To: bldg-sim at lists.onebuilding.org
Subject: [Bldg-sim] EPACT - more questions

 

The building that I am working on will have upgrades to lighting and HVAC.
Running the proposed with both these systems as upgrades gives me ~40% cost
savings. This is more than the 40% that is needed (for lighting and HVAC
individually 20%). My question is if this is partially qualifying (less than
50%), then should I run lighting and HVAC separately? and each should be 20%
saving? In this case the benefit of lower lighting will not be available to
HVAC.

 

Thanks

-Rohini



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