Biden Administration Opens Applications For States And Territories To Implement $8.5 Billion for Home Energy Rebates

The U.S. Department of Energy (DOE) on July 27 that it is accepting applications for state and territory implementation of the two Home Energy Rebate programs created by the Inflation Reduction Act.

The first program (The Home Efficiency Rebates Program) provides $4.3 billion for state energy offices to provide rebates for home energy efficiency retrofits resulting from the implementation of a home energy efficiency retrofit that is calibrated to historical energy usage for a home consistent with BPI 2400, for purposes of modeled performance home rebates. Contractors may receive $200 per home worked on that is in an “underserved community.”

Additionally, the IRA provided $4.275 billion for qualifying electrification home rebate projects (The Home Electrification and Appliance Rebates Program). This provision is part of the Biden Administration’s efforts to have electricity be the only energy that American households use. These include $8,000 for a heat pump, $1,750 for a heat pump water heater, $4,000 for an electric load service center, and $2,500 for electric wiring, capped at $14,000 total. This would narrow or even eliminate the gap between installing a heat pump and all electric system and replacing a boiler or furnace. However, this is sharply limited by income standards. If household income is greater than 150 percent of the area median household income, credits will not be available. For households that are between 80 and 150 percent of median household income, credits are limited to 50 percent of the project cost, and for households with less than 80 percent of median income, it can cover 100 percent.

These programs will be administered by each state along with a set amount of funding. Pennsylvania is receiving $129 million for each program ($258 million total). Pennsylvania DEP is the agency tasked with implementing both programs in the commonwealth. They estimate the introducing both programs in late 2023 or early 2024.

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