Cash for Caulkers?

Probably the most successful stimulus program to date (at least visibly to the public) was the Cash for Clunkers program. The program incited a boom in vehicle sales and encouraged the purchase of more fuel efficient cars.

Now, the White House is looking at a new version of Cash for Clunkers… but this time around for home weatherization. On paper, this sounds like a great idea. Not only would idle contractors be given work, but families could start saving both money and the environment simultaneously.

This graphic, by the New York Times and based on a recent study by McKinsey & Company, shows potential savings for relatively simple home improvements.

Here are the basics: (from a New York Times article)

The official name of the program would be Homestar, playing off the name Energy Star, a government program that promotes energy-efficient appliances.

It would cost $23 billion over two years. Of that, $6 billion would go to incentives to people who did at least two significant weatherization projects — such as air sealing, insulation, new light bulbs and new appliances. Homestar would have a list of 10 such projects. Households that did at least two would be eligible for up to $2,000. Households that did four would be eligible for up to $3,500. The government money could not pay for more than half of any project.

Another $12 billion would be set aside for households that undertook a weatherization project that reduced energy consumption by at least 20 percent. A 20 percent reduction would bring a $4,000 subsidy. Each additional 5 percent reduction would bring another $1,500. Again, government money could not pay for more than half of any project.Some portion of weatherization projects would be audited to ensure they had done what they were supposed to. These audits would be paid for with $2 billion for program administration.

The remaining $3 billion for the program would pay for incentives to retailers, like Home Depot and Lowe’s, and contractors.

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