By K.O. Jackson, Kokomo Tribune business writer
In an attempt to mirror the success of Cash for Clunkers, this fall, the federal government will offer states millions of dollars to entice consumers to participate in its Cash for Appliances program.
The program's goals mirrors that of the Clunkers program: replace less energy-efficient appliances with more efficient models, and stimulate the economy.
The Energy Department has $300 million - part of the Obama Administration's $787 billion stimulus package - to give states for the program. States' funds will be based on population.
However, unlike the Clunkers program, consumers will not have to trade in an old appliance for money. Rather, they will receive rebates between $50 and $200 for buying an energy-efficient appliance.
According to the Energy Department, states must submit rebate plans by mid-October and funds are expected to be distributed by late November.
"These rebates will help families make the transition to more efficient appliances, making purchases that will directly stimulate the economy and create jobs," Energy Secretary Steven Chu said in a statement.
Rebates will be offered on washers and dryers, air conditioners, dishwashers, freezers and refrigerators, boilers, furnaces, heat pumps and water heaters.
Furthermore, all eligible appliances must be covered by the Energy Dept. and the Environmental Protection Agency's Energy Star seal and meet their energy efficiency standards.
In 2008, according to the Energy Dept., close to 55 percent of new major-household appliances met the organizations standards.
In addition to saving energy, the program can do good for the appliance industry.
According to the Association of Home Appliance Manufacturers, the appliance industry needs interested buyers the same way the auto industry needed buyers. And where Cash for Clunkers stepped in to help put auto industry workers back on the job, so the federal government hopes its Cash for Appliances program can do the same for the appliance industry.
A representative of East Markland Avenue's Bass Appliance Parts and Repair said the "way the economy is right now, people aren't buying too much. They are keeping items longer and trying to fix them. This program may help pick up sales.
"Anything to help us all out is a good idea. It helped out cars."
Jeff Pearson, Vice President of Marketing for HH Gregg said, "We know consumers are attracted to environmentally friendly products. We are excited about the new Appliance Rebate Program, because it will give consumers even more incentive to buy energy-efficient appliances."
AHAM statistics indicate, through July, the shipments of washers, dryers, refrigerators and ovens were down 15 percent.
Cash for Appliances may bring the percentage up.
"I like this," said Derrick Martin, who operates the 60-year-old Russiaville Martin Bros. TV and Appliances with his father, Bill. "I would think it would help us and it would be popular.
"People can buy a new model and save money on their utility bills, and the bigger picture is using more efficient appliances. That's the big picture they are going for."