Obama proposes $3,000 home energy rebates

An Iowa State student (L) and Team Alberta student (R) at work on a roof during the 2009 Department of Energy Solar Decathlon on the National Mall, October 6, 2009.

SAVANNAH, Georgia (Reuters) - President Barack Obama on Tuesday proposed rebates of up to $3,000 to help homeowners pay for the cost of making their homes more energy efficient as part of a $6 billion program to create jobs.

In his latest step to convince Americans he can ease their economic woes, Obama traveled to Savannah Technical College to unveil a plan that could create tens of thousands of jobs.

The announcement came as White House economic adviser Larry Summers predicted that winter blizzards were likely to distort U.S. February jobless figures, which are due on Friday.

The White House had been relieved when the jobless rate dropped below 10 percent in January and could be preparing Americans for an uptick.

The efficiency plan, which must be passed by Congress, is intended to prompt Americans to invest in everything from insulation or new windows to overarching energy upgrades of their homes, creating construction and manufacturing jobs and boosting energy efficiency.

Consumers would be eligible for between $1,000 and $1,500 for simple home upgrades such as insulation, duct sealing, water heaters, air conditioning units, windows, roofing and doors.

Homeowners looking for more comprehensive energy retrofits would be eligible for a $3,000 rebate if the efficiency measures lead to a 20 percent energy savings.

"These are big incentives," Obama said. "You'd get these rebates instantly from the hardware store, from the contractor."

Obama, whose $787 billion economic stimulus plan approved a year ago has been criticized by Republicans as a waste of money that failed to create jobs, acknowledged that his clean energy proposals would face opposition.

"Each of these things are hard, some of them have some costs on the front end, and working stuff through Congress is 'more than a notion,'" he said.

With unemployment just below 10 percent, Americans are anxious about the country's finances, nudging Obama's approval ratings to 50 percent or below and potentially dimming his fellow Democrats' prospects in November's congressional elections.

The program involves a range of incentives for consumers, including rebates from stores that sell building materials, companies that install the equipment and utility energy efficiency programs. Consumers could also get rebates for a range of home energy upgrades.

Dubbed "cash for caulkers" after last year's successful "cash for clunkers" automobile trade-in program, the program was first announced in early December. Obama called on Congress to support it in his State of the Union address in January.

RARE BOOST FOR OBAMA AGENDA

Like "clunkers," it will have time limits, although such details would be worked out with Congress. Democrats included the program in a set of job-creation efforts they announced early in February.

"We would anticipate that in the range of 2 to 3 million households would participate," an administration official said. "It's designed to be a short-term program."

The scheme would also offer support for state and local governments to provide financing options for consumers who want to participate. The White House said it expected the program would save consumers $200 to $500 in energy costs per year.

The president's agenda got a rare boost last week when a few Republicans in the Senate joined Democrats to approve a $15 billion package of tax breaks and highway spending that aims to bring down the 9.7 percent unemployment rate.

But Republicans seeking to wrest control of Congress from the Democrats have scored political points by expressing concern that what Obama frames as job creation efforts are overspending to expand the reach of government. The White House must also placate investors nervous about deficit spending as it seeks to stimulate job growth.

Some of Obama's priorities -- notably healthcare and financial regulation -- have been stalled since his fellow Democrats lost their 60-seat "supermajority" in the U.S. Senate in January.

(Writing by Patricia Zengerle and Steve Holland; Editing by Cynthia Osterman)