Tax Credit Legislation

[SuperiorW&D]

[quote="EcoStar Windows"]I can't think of a set of real world variables that would result in that much savings unless you purchased the windows for practically nothing and did the install yourself. But that's not what the claim is based on so I have to call BS on this one. In fact frankly it's companies that make claims like this that give this industry a bad name. That's why the A.G.'s in some States are beginning to sue these types of companies for their outrageous claims.

Sorry if my comment was misleading. I have never claimed to ANY customer a 33% energy savings. The suits from the AG are exactly as I have stated on this board in other threads. They are based on claims of "at least 40% energy savings".

My claim is that "in our area you should see energy savings of about 15%". When I claim that "your windows can pay for themselves in 4 years" this claim IS based on the cost of the windows only and do NOT include installation costs.

80% of our sales do not include installation. That is better than 2009 when 90% of our sales did not include installation.

Another thing I was just thinking was that from what I've seen you guys are selling your windows for A LOT MORE than we do here in Southern Oregon. I may be able to make claims that you can't make.

[Skydawggy.]

You do say the numbers are based on windows cost of $1500 and then you subtract the tax credit of $450. I guess based on that math your ad is correct. However, the average number of windows we install is probably around 20-25 per house. I don't know what you charge for just the windows but even if it's $150 each for your lowest end, no frills window, that's still only 10 windows. I suppose it's like saying an automobile gets 50 MPG............. by going downhill, in neutral, with a 60 mph wind at your back.

[HomeSealed]

You do say the numbers are based on windows cost of $1500 and then you subtract the tax credit of $450. I guess based on that math your ad is correct. However, the average number of windows we install is probably around 20-25 per house. I don't know what you charge for just the windows but even if it's $150 each for your lowest end, no frills window, that's still only 10 windows. I suppose it's like saying an automobile gets 50 MPG............. by going downhill, in neutral, with a 60 mph wind at your back.

Holy crap! Average of 20-25 per house? I need to move south ... Around here we average 10-14, and we even see a fair amount of homes with 7 or 8 windows... I agree with you though that the math is a little questionable.. Superior I believe that some of your customers may very well pay off their windows(cash and carry) in four years in ideal circumstances, but guess what, some HO's can save that 40% that other companies claim in IDEAL circumstances... I don't necessarily have a big problem with you advertising a benefit that is possible, but don't you see at least some hypocrisy when you go out of your way to rip these other companies?... I realize that it is not exactly the same, but is it really that far off?

[Skydawggy.]

Yep. Last 3 houses we did were for 68 windows and 2 French Doors, attic insulation and 3 skylights, then 47 windows and 1 French Door and lastly 37 windows plus siding, roofing, 1 front door w/ sidelights and 2 skylights. Even most townhouses in this area are 10-18 windows. This area has a very high % of Colonials and there's usually 9-12 windows just on the front elevation. Bay windows are also pretty popular here in Northern Virginia.

I never make any definitive promises regarding energy savings. We only advise people that windows are not an investment that should be purchased with any expectation of "paying for themselves". My advice is that if you need new windows because your old ones need to be replaced, then do it for that reason. Certainly replacing windows that leak cold air, are difficult to operate or are just plain worn out are all really good reasons. Expecting them to be some type of investment in the traditional sense is just sales hype. If you want an investment see a Stock Broker, if you want a really good window, see us. Plus, we are really nice people to deal with.

[toddinmn]

I wasn't going to comment at all but Superior was asking for input.As far as making claims I am with Ecostar.I also will tell owners I do not know what the savings will be,not to expect much as far as savings go, there are far to many factors and best to get an energy audit with blower door test.Even if the the windows are broke and obviously leaking it would be obvious there would be some savings, but I would never put any kind of number on it.To do so I feel I would be lying or just making a number up.

[SuperiorW&D]

I want to thank all that took the time to comment. I really do appreciate your opinions. I wanted to take a few days to think and contemplate before responding. I hired a new sales person this past Monday and have been training all week, so the timing for this topic could not be better.

This was part of the orientation for this new employee:
1 - Customers want direct answers to their questions and get suspicious when you won't answer or beat around the bush.
2 - Explain to them that the size of their home, thermostat settings, geography (macro and micro - huge west facing windows - lots of trees), the number of windows, the type of window being replaced, the age of the original install, etc. play HUGE in the energy savings a customer will experience.
3 - It is our experience that the energy savings for a customer in our area replacing single glazed wood or aluminum windows with Energy Star compliant windows is about 15%.

We live in a very small community and if this statement (that I've been making for 5 years) were untrue I would have so many complaints that my head would be spinning. My follow ups (and my own personal experience) have also shown that, besides energy savings, the increase in comfort level that our customers experience is nothing short of life changing.

I feel great about what we do, how we've been verbalizing it, and the feedback from our customers - but item #2 above is going to be stressed more than in the past due to your comments. I will be copying/pasting this post into an email to all of my employees this morning.

Thanks again,
Roy

[fenestrationman]

After a little digging, this is what I came up with for the tax credit of 2011.
Consumers can claim 10% up to $200.00 for energy star qualified windows and skylites, and 10% up to $500.00 for doors. Same as last year, the install cost is not included.
There is now a lifetime limit of $500 ($200 for window/skylites) in total credits that a homeowner can claim from Jan 1, 2006 to Dec 31, 2011. It is not on top of the $1500 limit in 2009-2010. So if they have already reached or exceeded the $500 limit, they are no longer eligible to claim a credit in 2011. The $500 aggregate lifetime limit is for any combination of all tax credit qualifying products (HVAC, insulation, roofing, etc), not just windows, doors and skylites. If they have claimed less than $500, they can claim the difference up to the $200 cap for windows and skylites and $500 for exterior doors.
It's about clear as mud, but this is it.
The above was published by the Window and Door Manufacturers Association.

[toejam]

After a little digging, this is what I came up with for the tax credit of 2011.
Consumers can claim 10% up to $200.00 for energy star qualified windows and skylites, and 10% up to $500.00 for doors. Same as last year, the install cost is not included.
There is now a lifetime limit of $500 ($200 for window/skylites) in total credits that a homeowner can claim from Jan 1, 2006 to Dec 31, 2011. It is not on top of the $1500 limit in 2009-2010. So if they have already reached or exceeded the $500 limit, they are no longer eligible to claim a credit in 2011. The $500 aggregate lifetime limit is for any combination of all tax credit qualifying products (HVAC, insulation, roofing, etc), not just windows, doors and skylites. If they have claimed less than $500, they can claim the difference up to the $200 cap for windows and skylites and $500 for exterior doors.
It's about clear as mud, but this is it.
The above was published by the Window and Door Manufacturers Association.

I saw a TV advertisement for Renewal by Andersen (sorry for the profanity) and they mentioned a 2011 tax credit. I guess this is the one the same one that you explained.

[windowrealm]

I've seen manufacturers post energy savings guarantee's. They state as much as 40% energy savings or they'll refund the difference. Regardless of if you reach the savings or not, if you don't you still get reimbursed for the remainder. It's a investment in a sense, but your returns are marginal, 40% of a regular household utilities spending is still minor.

I'm just putting this out there since it's clear that some customers and professionals in the industry view these types of marketing tactics as shady. I'd have to disagree, if there is a guarantee behind the marketing. The guarantee doesn't mean it'll necessarily always be true but it does mean you can be reimbursed if it's not.

I feel there is a lot of value including and beyond the energy savings of replacing windows when it's right (ie. old drafty broken operating windows). If you need to put numbers to the value (ie. 40% savings) to help attract customers to your product. Why is that a bad thing if you're selling a quality product?

I see it as basically the same as when a hybrid car is marketed with great gas mileage. Regardless of the way you view hybrids, there's a upside and a downside to them and the marketing teams like to tout the positive numbers people want to hear.

[Skydawggy.]

Do you think it would be ethical for an automobile manufacturer to raise his price from $30,000 to $40,000 and then guarantee fuel economy of 80 mpg but only for the first year? Not only would it be unethical, it would be illegal. I'm glad many A.G.'s are suing window manufacturers and dealers for making ridiculous claims on energy savings. I'm also disappointed you fail to see this as unethical.

[HomeSealed]

+1 Eco... In fact, it would be like that same car manufacturer not only making a bogus claim of 80mpg, but then the fine print of their "guarantee" limits their actual liability to an absurdly low amount, and requires a consumer to jump through a ridiculous number of hoops to get it. "Dollarizing" the benefit of a product to a consumer is good marketing, however the 40%(+ or -) energy savings "guarantees" out there are typically unacheivable, misleading, and therefore unethical imho.

[windowrealm]

Great points, and I agree with much of what you've said. Matter of fact, the EPA testing standards for hybrids was flawed and the manufacturers were posting early hybrid fuel ratings 10-20% higher than they should have been. So in a way, this situation did occur and some even argue that EPA ratings are believed to be inaccurately rating still today.

But there is a situational difference here in that testing is not done by the manufactures of cars. Despite this, the same type of marketing exploits seem to occur. The law and regulation behind all of this is beyond me so I won't really go into all of that.

Realistically if you're a manufacturer posting outrageous energy savings claims, I agree you better be able to back those claims or make good on your refunds. If no one posts the energy savings and it's clear your product simply can't meet the claims, I would agree there is a problem with that.

I most likely don't have the experience many of you have in windows, but I've been around long enough to hear reports from companies whose customers did reach some outstanding energy savings like 40% when replacing single pane with windows that rate in the 20's in SHGC and U-Factor. Assuming other factors like wall and attic insulation is up to par.

So I guess where we differ in stance here is if windows can ever meet a 40% energy bill reduction. I can agree that this seems pretty dramatic and you can make a fair argument against it I'd imagine. Really, it's not hard to argue when, in some homes the gas or electric heating may not even make up 40% of the utility costs. However, I stand by the experience I've had and that is that in the right circumstances these savings are attainable. What I don't know though and what may be part of your experience, is if there's a 'fair' % of cases in areas where this is a reasonable possibility. At least in Colorado, it doesn't seem nearly that outlandish given the wildly cold temps that can be reached here (-20 expected tonight).

[Skydawggy.]

It's one thing to find certain situations where a consumer has saved 40% given the right circumstances, and to knowingly make false claims intended to mislead all consumers to believe they will save that much. I can tell you of a few situations where some of my customers have saved as much as 70% but I'm not going to lie and make all my customers believe they will have the same results. It's called integrity and doing the right thing even if it costs you a sale. I have to live with myself long after the sale and installation are completed. Anyone who has such poor sales skills that they have to resort to these kinds of tactics would benefit by re-examining their ethics and perhaps getting some additional training.

[windowrealm]

It's one thing to find certain situations where a consumer has saved 40% given the right circumstances, and to knowingly make false claims intended to mislead all consumers to believe they will save that much. I can tell you of a few situations where some of my customers have saved as much as 70% but I'm not going to lie and make all my customers believe they will have the same results. It's called integrity and doing the right thing even if it costs you a sale. I have to live with myself long after the sale and installation are completed. Anyone who has such poor sales skills that they have to resort to these kinds of tactics would benefit by re-examining their ethics and perhaps getting some additional training.

Fair enough. I can definitely understand your position. In-fact I think the world would be a better place if everyone took the hard line stance that you do. In reality, sly tactics (I'm not sure I would go so far as to say it's always misleading in this case) to draw customer attention is a common practice in marketing . In the event that a company stretches the truth for marketing purposes, it's ultimately up to the consumer to become educated especially with a purchase as large as windows. They have the power to decide and if they don't like a company marketing tactic, they shouldn't buy from that company.