If all lighting retrofit investments end up being deducted from income over time anyway, what is the benefit of EPAct?
The benefit of EPAct is that it allows a larger portion of the capital investment to be deducted in the first year. Generally, lighting retrofit investments are amortized over the life of the system. The Energy Policy Act allows a larger portion to be amortized or depreciated in the first year. IRS rules for writing off investments in long term capital assets varies, but can be as long as 39 years for capital improvements to building structures. The ability to immediately deduct almost the full cost a capital investment in a lighting system provides a significant financial incentive to a for-profit company.
