Rebates and tax credits for home improvements that conserve energy have increased sales and installation work for some home-improvement businesses and have helped others stay afloat during the recession, contractors and business owners here say.

Mark McVay, sales director at McVay Brothers Inc., a longtime Spokane Valley supplier and installer of windows, siding, and roofing, attributes an uptick in sales and installation of windows to the rebates and tax credits.

McVay Brothers' revenue was up 10 percent to 15 percent in the second quarter and so far in the third quarter, compared with the respective year-earlier periods, and window sales led that increase, McVay says.

Meanwhile, Specialty Home Products Inc., of Spokane, says that in June, it had the best month in the 30-year history of the company. July was another exceptional month, but the company didn't have final figures for July and couldn't say whether that month exceeded June's record volume of business, says Rick Simmet, who co-owns Specialty Home Products with his brother, Mark Simmet.

Meanwhile, Spokane-based Avista Corp. says a growing number of its customers are taking advantage of various rebates it offers to encourage residents to save energy.

Energy conservation gained traction in 2008, when Avista Corp. residential, commercial, and limited-income customers received more than 18,000 rebates and earned payouts of more than $15 million from the company, says Avista spokeswoman Debbie Simock. Those results were up sharply from 2007, when customers received $9.4 million from Avista through energy-conservation rebates and incentives. In 2008, the rebate programs helped the utility exceed its electricity-conservation target by 41 percent and its natural gas savings goal by 32 percent.

This year, the federal government is offering a tax credit of 30 percent of the price paid for high-efficiency windows, up to a maximum credit of $1,500, although the credit doesn't apply to installation costs, and Avista offers customers who buy qualifying windows rebates of $3 a square foot.

The tax credit and rebate add up to significant savings on a complete home-window installation job, for which the price of the windows alone typically would total $5,000, says Rick Simmet. Specialty Home Products also sells and installs roofing and siding.

Prospective customers ask him about energy-conservation rebates and tax credits on a daily basis, Rick Simmet says.

"It's been a great deal for us," he says of the incentives. "It's helping our business, and I think it's helping everybody in the window business."

Roofing is the biggest part of Specialty Home Products' business, but window sales and installations have been strong this summer, Simmet says.

Mark Siebert, who manages Specialty Home Products' window division, says that the incentives probably are the most important factor in many customers' decisions to buy windows now.

"Our window business is correlated directly with rebates," Siebert says. "We hear all the time from people who wouldn't be able to do projects without incentives."

McVay says roofing sales also are up this year at McVay Brothers. While the federal tax credit applies toward the price of asphalt and metal roofing materials that contain cooling granules, McVay attributes the business's increase in roofing sales more to roof damage during the past two recent harsh winters than to tax credits and rebates.

Daniel Schroer, owner of DanCar Mechanical Inc., of Spokane Valley, which sells and installs direct-exchange, ground-source heat pumps, says utility rebates are helping bring in business from people who want to upgrade their heating and cooling systems to more efficient technology.

"We've picked up on that type of sales," he says.

Prior to the incentive offers, he did about one retrofit of a heating and cooling system a month, Schroer says adding, "Last month, I did three."

A direct-exchange heat pump warms or cools a home by exchanging heat between the interior of the home and the subsurface of the ground below the frost line outside. Schroer says the process saves energy compared with electric or natural-gas heating and cooling.

The increase in retrofitting jobs is keeping DanCar alive, although it hasn't made up for a steep drop-off in new construction, Schroer says.

He says that before the recession, DanCar was doing installations at new high-end homes such as in the Black Rock developments near Coeur d'Alene, but adds, "A lot of people are holding off on new construction" now.

Avista, Spokane-based Inland Power & Light Co., and Coeur d'Alene-based Kootenai Electric Cooperative offer rebates ranging from $1,400 to $3,000 on heat pumps, depending on the type of system purchased, he says. The federal tax credit of 30 percent of the price of the unit applies, although unlike with windows, there is no upper limit to the tax credit for heat pumps, Schroer says. He says a typical retrofit for the type of system DanCar sells and installs costs $12,000 to $15,000.

Debbie Mead, who co-owns All Thermal Insulation Inc., of Spokane, with Body York, says she tells potential customers about Avista's rebate program to help sell insulation jobs, although she's unsure how many of the jobs the company has received because the rebate is available.

"A lot of people would probably get the insulation anyway," Mead says.

Avista offers cash rebates of up to half the cost of insulation installed in a home, and covers installation costs in its program, she says.

Mead says All Thermal's residential insulation upgrades typically range from $400 to $1,000 for homes that already have some insulation. Despite the recession, business has remained steady recently for the five-year-old company, although it hasn't landed as many jobs that involve new construction as it did a few years ago, she says.

Norm Thompson, owner of Specialty Insulation Inc., of Spokane, says Avista's rebates are bringing his company more business from home owners who want to add insulation, although that business hasn't offset the downturn from new construction. He says rebates typically return about a third of the cost of insulating attics and about half the cost of insulating walls.

"It's an awesome program," Thompson says.

Although the Internal Revenue Service allows a tax credit of 30 percent of the material cost of adding insulation up to a maximum credit of $1,500, Thompson says he's not hearing as much enthusiasm about the tax credit, because it doesn't apply to installation costs and because taxpayers won't get it until they file their taxes. Also, he says, the return isn't as immediate as with the Avista rebate.

Thompson says Specialty Insulation's work force has remained stable at about 15 employees since 2006.