NEMA Launches New Website To Support Energy-Efficient Lighting Tax Deduction

By Consulting Specifying Engineer Staff April 18, 2006

The National Electrical Manufacturers Assn.’s Lighting Systems Division has launched a new website for owners, specifiers, installers and sellers of lighting systems. The new website, , provides comprehensive education and implementation information about lighting upgrades covered by the commercial buildings tax deduction provision of the Energy Policy Act of 2005 (EPAct).

EPAct 2005 includes a commercial buildings tax provision that provides a deduction of the cost of energy efficient systems up to $1.80 per sq. ft. for buildings designed for 50% energy cost savings relative to a building designed to ASHRAE Standard 90.1-2001, Energy Standard for Buildings Except Low-Rise Residential Buildings. Lighting systems, HVAC/water heating and building envelope improvements can each qualify for up to a $0.60 per sq. ft. deduction for their contribution to the 50% savings. The law allows lighting to receive up to a $0.30 to $0.60 deduction for savings in lighting power density from 25% to 40% respectively, with linear interpolation between 25% and 40% reduction. The interim lighting provision requires bi-level switching in addition to the 90.1-2001 lighting controls. Final regulations are pending from the U.S. Dept. of Treasury, but it should also be noted that utility and other rebate incentives can be combined with the deduction.

“This provision represents a strong incentive for building owners to reduce operating costs while increasing profitability and competitiveness by investing in available, proven, energy-efficient lighting choices,” says Brian Dundon, chairman of NEMA’s Lighting Executive Board of Directors.“NEMA estimates that this provision will result in about $500 million in additional lighting product sales.In addition, the nation will benefit from an estimated 312 MW in reduced electrical demand and an estimated reduction in national carbon emissions of 10 million metric tons.”

The website contains a wide range of frequently asked questions, process maps detailing compliance with Standard 90.1-2001, and examples of projects that demonstrate how target reductions in lighting power can be achieved.The site also provides descriptions of popular energy-efficient lighting strategies and technologies, links to research studies, a directory of NEMA Lighting Systems Division members, and additional communications resources.

“Taking advantage of deductions NEMA fought for in the 2005 Energy Policy Act represents a win-win situation for manufacturers, building owners, and the provides practical guidance on implementation of the commercial buildings tax deduction,” says NEMA President Evan Gaddis.

The site is a companion to, produced by the Commercial Building Tax Deduction Coalition, which addresses incentives for efficiency improvements across HVAC/hot water, building envelope, and interior lighting systems.