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‘‘SEC. 200. ENERGY PROPERTY DEDUCTION. 
‘‘(a) IN GENERAL.—There shall be allowed as a deduc-
tion for the taxable year an amount equal to the greater 
of— 
‘‘(1) the amount determined under subsection (b) 
for each energy property of the taxpayer placed in 
service during such taxable year, or 
‘‘(2) the energy efficient residential rental build-
ing property deduction determined under subsection 
(e). 
‘‘(b) AMOUNT FOR ENERGY PROPERTY.—The amount 
determined under this subsection for the taxable year shall 
be— 
‘‘(1) $150 for any advanced main air circulating 
fan, 
‘‘(2) $450 for any qualified natural gas, pro-
pane, or oil furnace or hot water boiler, and 
‘‘(2) $900 for any energy efficient building prop-
erty. 
‘‘(c) ENERGY PROPERTY DEFINED.— 
‘‘(1) IN GENERAL.—For purposes of this part, 
the term ‘energy property’ means any property— 
‘‘(A) which is— 
‘‘(i) energy-efficient building property, 
‘‘(ii) a qualified natural gas, propane, 
or oil furnace or hot water boiler, or
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‘‘(iii) an advanced main air circu-
lating fan, 
‘‘(B)(i) the construction, reconstruction, or 
erection of which is completed by the taxpayer, 
or 
‘‘(ii) which is acquired by the taxpayer if 
the original use of such property commences with 
the taxpayer, 
‘‘(C) with respect to which depreciation (or 
amortization in lieu of depreciation) is allow-
able, and 
‘‘(D) which meets the performance and 
quality standards, and the certification require-
ments (if any), which— 
‘‘(i) have been prescribed by the Sec-
retary by regulations (after consultation 
with the Secretary of Energy or the Admin-
istrator of the Environmental Protection 
Agency, as appropriate), 
‘‘(ii) in the case of the energy efficiency 
ratio (EER) for central air conditioners 
and electric heat pumps— 
‘‘(I) require measurements to be 
based on published data which is tested
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by manufacturers at 95 degrees Fahr-
enheit, and 
‘‘(II) may be based on the cer-
tified data of the Air Conditioning and 
Refrigeration Institute that are pre-
pared in partnership with the Consor-
tium for Energy Efficiency, 
‘‘(iii) in the case of geothermal heat 
pumps— 
‘‘(I) shall be based on testing 
under the conditions of ARI/ISO 
Standard 13256–1 for Water Source 
Heat Pumps or ARI 870 for Direct 
Expansion GeoExchange Heat Pumps 
(DX), as appropriate, and 
‘‘(II) shall include evidence that 
water heating services have been pro-
vided through a desuperheater or inte-
grated water heating system connected 
to the storage water heater tank, and 
‘‘(iv) are in effect at the time of the ac-
quisition of the property, or at the time of 
the completion of the construction, recon-
struction, or erection of the property, as the 
case may be.
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‘‘(2) EXCEPTION.—Such term shall not include 
any property which is public utility property (as de-
fined in section 46(f)(5) as in effect on the day before 
the date of the enactment of the Revenue Reconcili-
ation Act of 1990). 
‘‘(d) DEFINITIONS RELATING TO TYPES OF ENERGY 
PROPERTY.—For purposes of this section— 
‘‘(1) ENERGY-EFFICIENT BUILDING PROPERTY.— 
The term ‘energy-efficient building property’ means— 
‘‘(A) an electric heat pump water heater 
which yields an energy factor of at least 2.0 in 
the standard Department of Energy test proce-
dure, 
‘‘(B) an electric heat pump which has a 
heating seasonal performance factor (HSPF) of 
at least 9, a seasonal energy efficiency ratio 
(SEER) of at least 15, and an energy efficiency 
ratio (EER) of at least 13, 
‘‘(C) a geothermal heat pump which— 
‘‘(i) in the case of a closed loop prod-
uct, has an energy efficiency ratio (EER) of 
at least 14.1 and a heating coefficient of 
performance (COP) of at least 3.3, 
‘‘(ii) in the case of an open loop prod-
uct, has an energy efficiency ratio (EER) of
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at least 16.2 and a heating coefficient of 
performance (COP) of at least 3.6, and 
‘‘(iii) in the case of a direct expansion 
(DX) product, has an energy efficiency ratio 
(EER) of at least 15 and a heating coeffi-
cient of performance (COP) of at least 3.5, 
‘‘(D) a central air conditioner which has a 
seasonal energy efficiency ratio (SEER) of at 
least 15 and an energy efficiency ratio (EER) of 
at least 13, and 
‘‘(E) a natural gas, propane, or oil water 
heater which has an energy factor of at least 
0.80. 
‘‘(2) QUALIFIED NATURAL GAS, PROPANE, OR OIL 
FURNACE OR HOT WATER BOILER.—The term ‘quali-
fied natural gas, propane, or oil furnace or hot water 
boiler’ means a natural gas, propane, or oil furnace 
or hot water boiler which achieves an annual fuel uti-
lization efficiency rate of not less than 95. 
‘‘(3) ADVANCED MAIN AIR CIRCULATING FAN.— 
The term ‘advanced main air circulating fan’ means 
a fan used in a natural gas, propane, or oil furnace 
originally placed in service by the taxpayer during 
the taxable year and which has an annual electricity 
use of no more than 2 percent of the total annual en-