AHAM Calls for Renewal of Appliance Rebate Program
Jun 8, 2010
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The recent U.S. State Energy Efficient Appliance Rebate Programs (SEEARP) delivered on its promise of stimulating economic activity, but its effectiveness was limited by modest funding and complicated rollout, according to the Association of Home Appliance Manufacturers.
AHAM called for the rebate program to be renewed, but recommends a single, national rebate program instead of the 50 state programs that made up the original SEEARP.
Many AHAM members saw significantly increased demand for the Energy Star appliances included in the rebate program. This is reflected in the AHAM report on April factory shipments, with a nearly 20% increase in shipments of major home appliances compared to April 2009. Year-to-date, AHAM noted, shipments of core appliances were up 9.1% following four consecutive years of declines.
Major retailers have also confirmed that the rebate program helped bring consumers back into stores.
Even though the $300 million in funding for the appliance rebate program was far less than other stimulus programs, the return of consumers to stores helped stimulate purchases of goods other than appliances. In this regard, AHAM said, the appliance rebate programs have served as a catalyst for additional consumer spending and economic activity. The U.S. Department of Energy (DOE) estimated that $1.3 billion in consumer spending would result from the rebates being offered on home appliances alone.
"The state rebate programs, also known as ‘Cash for Appliances,’ have had a measurable, positive impact on the appliance industry," said AHAM President Joseph M. McGuire. "People who were sitting on the fence deciding whether to repair or replace their appliance were offered a compelling incentive to purchase a new energy efficient product. Not only did the rebate serve as an initial discount on the product, but the new product will offer consumers years of energy and utility savings."
McGuire said SEEARP helped increased demand for energy efficient appliances, and that had a positive impact on jobs in appliance manufacturing and sales. "We encourage the Congress to renew the program, but with additional funding and process improvements to expand its ability to save energy and jobs," he said. "
AHAM said a single, national rebate program would reduce the need for separate DOE approvals and reduce administrative costs compared to the 50 state programs of the original SEEARP. A consistent, nationwide program would make it much easier for manufacturers to partner with retailers to develop promotional campaigns to make consumers aware of the rebates.
"The large number of individual programs made it next to impossible for manufacturers to follow all of them and to relay information to consumers and retailers," McGuire said. "A single program, supported by focused messaging, Web sites and information would improve consumer satisfaction and improve the success of the program."
AHAM also pointed out that in states that have used the reservation system for rebates, funding seems to have been allocated more smoothly and more quickly. Allowing consumers to receive the rebate up front or at the time of purchase is a much greater incentive than a mail-in procedure. This practice seems to result in fewer consumer concerns and should lead to fewer consumer disappointments.
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