Appliance Sales to Get ‘cash for Clunkers’ Boost?

Michael Giberson

In the news, reports of a “cash for clunkers” program for major appliances: USA Today: Appliances get their own recycled clunkers programs; Business WeekLatest in Stimulus: ‘Cash for Refrigerators’; Associated Press: Meltdown 101: Government cash for green appliances.

From Business Week:

Beginning late this fall, the program authorizes rebates of $50 to $200 for purchases of high-efficiency household appliances. The money is part of the broader economic stimulus bill passed earlier this year. Program details will vary by state, and the Energy Dept. has set a deadline of Oct. 15 for states to file formal applications. The Energy Dept. expects the bulk of the $300 million to be awarded by the end of November. (Unlike the clunkers auto program, consumers won’t have to trade in their old appliances.)

“These rebates will help families make the transition to more efficient appliances, making purchases that will directly stimulate the economy,” Energy Secretary Steven Chu said in a statement announcing the plan.

Since the cash is just a rebate for the purchase of an Energy Star certified appliance, and no old appliance needs to be returned, this really isn’t a “cash for clunkers” analogue for appliances. (Unless the Energy Star certified appliances turn out to be clunkers.)  The program was created in the Energy Policy Act of 2005, but not funded by Congress until the carnival of stimulus spending earlier this year.

Joe Walsh Red Green and Blue blog is getting ahead of the curve, already picking apart the “win, win, win” claims of the appliance rebate program’s boosters.

Walsh expresses concern that without a requirement to junk the old appliance, it will instead migrate to the garage or the basement and store “extra beer and the overflow from Costco.” No energy savings in that scenario.

Of course requiring disposal of useful appliances would cause a more immediate and obvious waste of resources.  At least in this case some of the old appliances may make it into the secondhand market and help reduce prices for consumers unable to afford to take advantage of government rebates for new, energy efficient devices.

(And while we’re picking on “Cash for Clunkers,” readers may enjoy Jeff Jacoby’s “The Truth about Cash for Clunkers” from the Boston Globe.)

One thought on “Appliance Sales to Get ‘cash for Clunkers’ Boost?

  1. Walsh is rightly concerned. There was a lot of hand wringing in California during 2006 because forecasts for residential use had failed to account for 1) the increase in plasma and LCD televisions, and 2) that people had moved their old refrigerator into the garage instead of junking it. Due to that failure, load forecasts had failed to account for this increase in residential base load- when there’s plenty of supply it goes unnoticed, when you have a peak event when mere MW’s stand between keeping the lights on and blackouts, those forecasting errors are big deals.

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