Federal and state tax incentives also provide a way for householders to save money on energy costs.

The federal government offers tax credits for energy-efficient home improvements and Virginia is offering tax rebates.

Federal tax credits

Federal tax credits are available at 30 percent of the cost, up to $1,500, in 2009 and 2010, on existing homes only, for:
—windows and doors
—insulation
—metal and asphalt roofs
—HVAC systems
—non-solar water heaters
—biomass stoves
Federal tax credits are available at 30 percent of the cost, with no upper limit through 2016, on existing homes and new construction, for:
—geothermal heat pumps
—solar panels
—solar water heaters
—small wind energy systems
—fuel cells
To qualify for the tax credits, the home improvements:
—must be placed in service during Jan.1, 2009, through Dec. 31, 2010
—must be for taxpayer’s principal residence, except for geothermal heat pumps, solar water heaters, solar panels, and small wind energy systems, where second homes qualify
—must have a Manufacturer Certification Statement to qualify
For record keeping, save your receipts and the Manufacturer Certification Statement.
If you are building a new home, you can qualify for the tax credit for geothermal heat pumps, photovoltaics, solar water heaters, small wind energy systems and fuel cells, but not the tax credits for windows, doors, insulation, roofs, HVAC, or non-solar water heaters.

Virginia tax rebates

Virginia will provide up to $15 million in tax rebates for energy efficiency measures and equipment to retrofit homes and commercial property and up to $15 million in rebates for renewable energy equipment and systems for residential and commercial applications.
Eligible residential and commercial property owners wishing to receive a rebate through the Virginia Energy Efficiency Rebate or Renewable Energy Rebate programs will be required to complete an application form, which will be available online from the Virginia Department of Mines, Minerals and Energy by Nov. 1. Applicants can take the first step to sign up for news on both rebate programs at this link:
http://www.virginia.gov/eerebates
When the web-based reservation and application process goes “live,” applicants will be able to reserve funding for proposed projects and will be allowed a reasonable amount of time to complete the project and provide required documentation before a rebate is approved.
The total rebates paid cannot exceed $2,000 for a residential property if no energy audit is conducted, $2,250 for a residential property if an eligible energy audit is conducted, $4,000 for a commercial property if no energy audit is conducted, or $4,250 for a commercial property if an eligible energy audit is conducted.
If they meet minimum required standards for energy efficiency, measures and equipment qualifying for the state tax rebate include: energy audits; central air conditioners; air source heat pumps; natural gas or propane furnaces; oil furnaces; gas, propane or oil hot water boilers; . gas, oil or propane tankless water heaters; high-efficiency gas storage water heaters; electric heat pump water heaters; geo-thermal heat pumps; insulation and air sealing; replacement windows, doors and skylights; storm windows and storm doors; programmable thermostats; and for commercial property applicants, commercial lighting upgrades, commercial high efficiency motors and drives, and compressed air or steam system upgrades.