Ask Jon Eakes

Last Updated: Friday, October 15th, 1999, Created: Friday, October 15th, 1999

WHAT IS A COST ANALYSIS DEDUCTION?

There are two types of "deductions" that can be taken off the cost of rewinterizing before evaluating the cost effectiveness of a given option.

-- Piggyback deductions; The cost of work that had to be done anyway can be deducted from the cost of an energy saving project. If your house needs new siding or a new roof, independent of any energy saving questions, insulate before putting on the new siding or roof and only count the material and labour directly related to insulation in your energy cost effective analysis.

-- Government grants are free money (although you have to reduce their real value when they are taxable). Subtract them from the total cost of the project before finding out if the dollars you invest are cost effective. It is your money against your energy savings that are important to you budget.

Keywords: Financial

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