Sen. Randolph Townsend, R-Reno, said he plans to introduce legislation in the 2007 Legislature that would give home buyers property tax breaks if they purchase environmentally designed homes.

Townsend also said he would like to give builders sales tax breaks and other incentives for building environmentally sensitive housing. For example, there might be a sales tax break for certain insulation and roofing materials, or local governments could be required to expedite the permitting process for green housing, he said.

"We don't have anything definitive, but we are trying to be creative and put things on the table," said Townsend, who added he has consulted with homebuilders, utilities and consumer advocates. "We are looking at property tax breaks which of course would move consumers to purchase the home. Imagine what great incentives there would be for builders if people could include that in their purchase decision."

Existing homeowners wouldn't get shut out, Townsend said. They could get sales tax breaks by replacing windows, wrapping water heaters and other purchases that encourage conservation, he said.

Townsend said it's a natural progression to extend incentives to the homebuilding industry because the property tax breaks put in place in September are already encouraging commercial developers to pursue green buildings. The builders get a tax abatement of up to 50 percent for up to 10 years on a sliding scale system.

If builders of single-family homes, apartments and condominiums construct housing that's more energy efficient, Nevada can hold off on purchasing additional power and keep costs lower for consumers, Townsend said. That would also improve the credit-worthiness of Nevada Power and lower its cost to build its system, thereby keeping bills lower, he said.

A proposal that gives homebuilders incentives to build green housing has the support of the Southern Nevada Home Builders Association. In October, the group announced a program to guide builders who want to construct more environmentally sensitive housing and expects the Las Vegas Valley's first batch of homes meeting those standards to be completed by the end of 2007. Following those guidelines could add $5,000 to $10,000 to the price of a new home.

"We have suggested there are already incentives for the commercial (builders) to do green buildings and that government policymakers might want to look at incentives for residential, even though there are those already doing green building," said Monica Caruso, the home builder association spokeswoman. "The incentives might encourage smaller home builders into this building program."

In its green program, builders reduce the quantity of materials and waste through a framing plan, install gutters to divert water from the foundation, use recycled materials and renewable materials, improve energy efficiency and include high-efficiency plumbing fixtures, install smart-water landscaping and install carpet and padding with green labels.

There are several other steps to follow.

Townsend said he's optimistic any legislation extending the incentives to homebuilders and consumers will get the support of state lawmakers.

The biggest concern, however, will likely be the cost of the tax breaks to the state treasury, especially since homebuilders are already moving in the direction of building green homes to meet consumer demands.

The potential loss of tax dollars for a commercial program isn't known. It could run tens of million of dollars or hundreds of millions of dollars, depending upon the number of buildings that qualify, said Tim Rubald, executive director of the Nevada Commission on Economic Development.

Townsend admitted there will be a cost to the state treasury for adopting residential incentives but said it's worth it for what it saves in energy consumption and costs.

"It's like the old Fram commercial. 'You can pay me now or pay me later,'" Townsend said.

The tax abatements for commercial buildings are applied when it is certified as green under standards of the United States Green Building Council - features that can include efficient wall and roof insulation, high-performance windows, ground-source heat pumps, under flood air distribution systems, energy recovery ventilators, day lighting, motion sensors on restroom lights and more.

Any residential incentive program for Nevada could be delayed because the U.S. Green Building Council has yet to adopt standards for green home construction. Those standards are forthcoming, officials said.