Energy Policy Act 2005

Lighting, on average, consumes a significant amount of the energy use in a typical building. Due to ease and availability of upgrading lighting systems and the known achievements in potential energy efficiency that will be gained, building owners are encouraged to focus first on lighting systems to target energy efficiency.

The Secretary of the Treasury will issue the final regulations that detail the energy-savings target for the building subsystems (interior lighting, HVAC, and building envelope) in order to potentially obtain a partial tax deduction. Until these regulations are issued, interim rules for lighting projects detail the guidelines to follow in order to potentially achieve a partial tax deduction for the interior lighting subsystem. The Interim Rules for Lighting Projects involves achieving the energy savings targets by installing a lighting system that could potentially reduce the lighting power density (LPD) lower than the ASHRAE/IES Standard 90.1 – 2001.

According to the Interim Rules for Lighting Projects:

• The lighting system energy savings target is a LPD, watts per square foot, that is 25% to 40% lower than the minimum requirements of ASHRAE/IESNA Standard 90.1–2001
• The potential amount of the tax deduction available is $0.30 to $0.60 per square foot depending upon the percentage that the LPD is reduced beyond the ASHRAE Standard 90.1 – 2001
• For warehouses, the lighting power density (W/sq. ft.) must be 50% lower than the minimum requirements of ASHRAE Standard 90.1–2001 to be eligible for $0.60 per square foot.
• Lighting power density (W/sq.ft.) reductions of <25% are ineligible for any tax deduction

For reductions in lighting power density (W/sq.ft.) 25% - 40% the following table indicates the amount of the maximum eligible deduction based on a sliding scale. Click the table for a large version.


Below is a table that lists some of the lighting power densities for commercial buildings detailed in the ASHRAE 90.1 – 2001 standard. Visit the American Society of Heating, Refrigeration, and Air-Conditioning Engineers (ASHRAE) website for a complete list of the lighting power densities. There are two methods to measure the lighting power density. The Space by Space method refers to upgrading the lighting system in a specific area of a building. The Building Area Method refers to upgrading the lighting system in the entire building.

Space-by-Space Method Common Space Types*	Lighting Power Densities (W/sq.ft.) 2001
Office – Enclosed	1.50
Conference/Meeting/Multipurpose	1.30
Lobby	1.80
Atrium – Each additional Floor	0.20
Dining Area	1.40
Restrooms	1.00

Building Area Method	Lighting Power Densities (W/sq. ft.) 2001
Automotive Facility	1.50
Healthcare-Clinic	1.60
Hospital	1.60
Hotel	1.70
Manufacturing Facility	2.20
Office	1.30
Retail	1.90
School/University	1.50
Warehouse	1.20
*Not all space types are listed.

In addition to demonstrating a reduction in lighting power density lower than the requirements for Standard 90.1–2001:

• Control provisions (ie. Automatic Lighting Shutoff) relating to lighting systems as set forth in the Standard must be met
• Bilevel switching must be installed
• The lighting system must also meet the minimum requirements for calculated light levels as set forth in the 9th Edition of the IESNA Lighting Handbook. Visit the Illuminating Engineering Society of North America for information on obtaining the lighting handbook.