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Energy Retrofit

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HOUSE+

Improve Home Efficiency with Inflation Reduction Act Rebates

The new legislation would provide $9 billion for efficiency upgrades, including heating, cooling and cooking appliances, photovoltaics, and electric vehicles.

By Patrick McCombe
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Photo: Topher Donahue

The new legislation expected to be signed into law provides $9 billion in total home-energy rebates. Perhaps the most notable provision is the $4.28 billion High-Efficiency Electric Home Rebate Program that gives a rebate of up to $8000 for installing high-efficiency heat pumps and a rebate up to $1750 for installing a heat-pump water heater.

Homeowners can also apply for up to $840 to offset the cost of a heat-pump clothes dryer or a high-efficiency induction range. Obviously, many homes will need electrical upgrades to take advantage of the rebates and the Act offers up to a $4000 rebate toward electrical service and panel upgrades. There’s also money (up to $2500) for wiring upgrades for heating and cooling equipment and appliances, and for electrical-vehicle charging. Homeowners can also apply for up to $1600 for air-sealing and insulation improvements.

A bright spot for solar too

The legislation continues the current 30% tax credit for installing residential solar panels and extends the program until December 31, 2034. The tax credit decreases to 26% for PV panels put into service after December 31, 2032. Photovoltaic (PV) battery systems with at least three kilowatt-hours (kwh) of capacity also qualify for the tax credit.

The solar and home energy-efficiency ​​tax credits are in addition to the $7500 for new electric vehicle purchases and $4000 for lower- and middle-income families to purchase a used EV. The program will be run by individual states through September 30, 2031. The Inflation Reduction Act allows a maximum of $14,000 in total rebates. Household income cannot exceed 150% of the area median income.

Start planning updates

Fine Homebuilding regularly produces articles and videos to help builders and homeowners make energy-efficient updates to homes. Check out the articles below to start planning retrofits and upgrades and to utilize the cost reduction from the rebate program.

Heat Pumps & Water Heaters

  • All About HVAC
  • Understanding Heating and Cooling Equipment Terminology
  • Choosing an Efficient Water Heater
  • Heat-Pump Water Heaters
  • High-Tech Heating and Cooling Systems
  • Sized-Up Electric Heat Pump
  • Webinar: Heat Pumps and Cold-Climate Applications–Designing for Comfort and Resiliency
  • How to Choose the Right-Size Heating and Cooling System

Electrical Upgrades

  • Planning an Electrical Remodel
  • Understanding Service Panels
  • Installing an Electrical Service
  • Running New Wires Through Old Walls
  • Electrical Retrofit–Working With Old Wires

Solar & Electric Vehicles

  • The Steady Surge in Residential Solar
  • Designing for Solar Panels
  • Rules for Rooftop Solar
  • Installing Rooftop PV
  • Power Your Home With Bidirectional Charging

Air-Sealing and Insulation

  • What is a Home Energy Audit?
  • Straightforward Air-Sealing Strategies
  • How to Set Up and Use a Blower Door
  • A Guide to Choosing Insulation
  • Six Proven Ways to Build Energy-Smart Walls

Fine Homebuilding Recommended Products

Fine Homebuilding receives a commission for items purchased through links on this site, including Amazon Associates and other affiliate advertising programs.

Utility Knife

This utility knife is well-made and comes in handy when cutting rigid foam insulation. You can extend the snap blade to cut through a 2-inch foam board.
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Insulation Knife

If you like insulating with mineral wool, this knife makes cuts that are clean, neat, and easy — it's much better than a utility knife which can be slow and messy.
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Caulking Gun

It's important for any insulator to have a good caulking gun for air sealing or adhesives, and this one features a revolving frame that makes orienting the tip a breeze.
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Energy Efficiency
  • Understanding Energy Efficiency
  • Net-Zero & Passive Houses
HVAC Systems and Water Heaters
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Deep Energy Retrofits
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