In July, U.S. Department of Energy Secretary Steven Chu announced that nearly $300 million in federal funding was available for the "Cash for Kitchen Clunkers" program. While that pales in comparison to the $3 billion allocated to the auto rebate program "Cash for Clunkers," one has to remember how much more cars cost. It's still a decently sized program. Funding comes from the federal economic stimulus package signed in February.
"Cash for Kitchen Clunkers," as opposed to the auto rebate program, will be run by the state, who will set their own guidelines. Energy Star qualified appliance categories eligible for rebates include: central air conditioners, heat pumps (air source and geothermal), boilers, furnaces (oil and gas), room air conditioners, clothes washers, dishwashers, freezers, refrigerators, and water heaters.
Each state (or territory, such as Puerto Rico) will, through their energy offices, be awarded "Cash for Kitchen Clunkers" funding using a formula set forth in the Energy Policy Act of 2005. Each state or territory is required to submit a plan that specifies which Energy Start appliance categories will be included in their rebate program, the rebate level for each product type, how the rebates will be processed, and their plan for recycling old appliances.
"Cash for Clunkers," the auto program, while seemingly helping car dealers and automakers a lot, has still faced criticism. Some said it simply accelerated purchases that would have happened anyway, sans the rebate. Others criticized it for being a short-term boost. Will similar criticism over "Cash for Kitchen Clunkers" appear?
Once again the question will be, is "Cash for Kitchen Clunkers" simply an accelerant? Does it really increase spending, or does it simply encourage people to move their purchases forward? At any rate, those who have old (like mine) refrigerators or other appliances will likely be looking to utilize this program once it begins, late this year or early next, depending on the state.