10 Questions for . . . Brett Battles, CEO of Castanea Labs

In this installment of 10 Questions for . . . , Senior Editor Daniel DiClerico speaks with Brett Battles, CEO of Castanea Labs, a Silicon Valley startup that recently launched a tool to help you find rebate information for energy-efficient appliances. Here, Battles discusses his company's rebate locator and the U.S. Department of Energy's $300 million cash for clunkers for appliances program and says more incentives are on the horizon.

Several online tools exist to help consumers get information on tax incentives and rebates for appliances and home improvements, including the Database of State Incentives for Renewable Energy (DSIRE). Why do we need another?
I applaud DSIRE for its efforts but it's incomplete. For instance, it covers energy efficiency and not water efficiency. We found a lot of local water utilities, for example, paying cash incentives on low-flow showerheads and toilets. DSIRE also doesn't tell consumers how much money they can get back on this or that specific product. Finally, based on our research, existing rebate finders, like the one on EnergyStar.gov, aren't prevalent enough at the point of sale.

How many rebate programs are active now?
The DOE's cash for appliances program is getting all the attention, but we've identified more than 500 utility-based rebates on everything from low-flow showerheads to attic insulation to appliances. It's just that most people don't know about these programs, and if they do, they often have a hard time sorting through the options and understanding the requirements.

How does your rebate finder differ from others?
Consumers shouldn't have to be Sherlock Holmes to figure out which rebates apply to the products they want. They should be able to go to a retailer's or a manufacturer's Web site, pick a specific product, type in their ZIP code, and find out instantly what rebates are available, whether from their state, utility company, or other source. In a nutshell, that's the solution we've created. Our analysts update the data on a weekly basis, if not more frequently.

How does Castanea make money from the tool?
Retailers and manufacturers pay us a multiyear subscription fee for the use of our rebate locator, which we customize to their specific requirements. Whirlpool has already launched a version of the tool (shown), and a major national retailer is expected to do so in the coming weeks, with others to follow. We also have a community portal where consumers can get free information about rebates.

How do consumers know they're getting a representative selection of models and not just those your clients want to promote?
Our database includes all Energy Star products, which is the baseline requirement for most rebates. In the case of retailers, the database interfaces with their e-commerce site to show all qualifying products they carry. Manufacturers naturally want to show only their products and not those of their competitors. But in either scenario, the client pays a flat-rate fee that's completely independent of transactions, so we don't get paid more to push a particular product.

Does the tool indicate when states will launch their cash for clunkers program so consumers can time their purchases to take advantage of the rebate?
We have the capability to provide that information, since we know the start dates, ZIP codes, and qualifying product SKUs. However, clients choose which features to implement. In most cases, they're already managing e-mail communications with their consumers. Most have preferred to continue that arrangement to notify consumers about future programs versus having us do it on their behalf.

(To find out when the rebate program will take place in your state, use our interactive cash for clunkers for appliances map.)

You sell multiyear subscriptions, but won't most state rebates expire in a few months or even faster?
You have to remember that appliance rebates and incentives for other high-efficiency products have been around for decades. Altogether, the money budgeted for multiyear utility programs tops the DOE's $300 million for its cash for appliances. So the givebacks aren't going away. Plus, the Obama administration and many states have made energy efficiency a top priority. My prediction is that two years from now, you'll see 50 percent more rebate programs and money than you do today.

Why don't rebate programs look the same from state to state?
Look at anything in the public sphere—tax codes, real estate laws, cell phone driving laws. States tend to have dramatically different perspectives about what's best for them.

We're seeing that in a big way with cash for appliances. The DOE left it up to the states to decide the specifics of their programs. Some are paying only on major appliances, others on geothermal heat pumps and boilers. Some require recycling, others don't.

(Find out which products are eligible for a rebate in your state.)

How are rebates managed in other countries?
Rebates are very important abroad, especially in Europe and Australia, where stringent efficiency regulations create a need for incentives to bring in consumers. In the last dozen years, Australia has undergone an amazing market transformation and cites specifically its rebate programs as one of the underlying factors in closing the penetration of high-efficiency products.

Do you have any plans to expand the service?
Right now we're focusing on Energy Star products. But we'll be moving into residential solar sometime in the second half of 2010 and might take the service outside of the U.S.

Essential information: Before you look for rebates on an appliance, make sure it's a worthy performer. Our appliances hub has links to our free buyer's guides. And find the best places to buy appliances.