Home energy rebates

The Inflation Reduction Act was signed into law by President Biden in August 2022. The Act authorized rebates for new types of home improvements that reduce energy costs. These are part of the law’s historic $391 billion investment in tackling climate change. They position America’s Main Street small businesses at the forefront of this investment. They also present a generational opportunity for small businesses to grow. 

The U.S. Department of Energy estimates the rebates will save households up to $1 billion on energy bills each year. They will also support over 50,000 U.S. jobs. Rebates will begin rolling out to consumers in some states as soon as spring 2024.

• The Home Electrification and Appliance Rebates program:
  • Customers receive up to $14,000 in rebates for buying or installing electrification equipment. Equipment must be installed in low to medium-income communities. 
  • To receive a point-of-sale rebate, consumers will have to use an online portal. Portals will vary by state. 
  • Consumers will use the portal to claim an eligibility voucher or coupon.
• The Home Efficiency Rebates program:
  • Consumer rebates for projects that reduce energy consumption in single-family homes or multifamily buildings. 
  • Rebate sizes may vary by household income and how much the energy upgrades reduce energy consumption. 

If you are a home repair or construction small business, these rebates can help you grow or start your business. Rebates reduce costs for your customers; since many more consumers will be able to afford upgrades,this leads to more customers to your business.

Any small business providing energy efficiency or electrification installation services is eligible. These include:

• Door and window installers
• Plumbers
• Electricians
• General contractors
• Heating and air 

Your business will need to be qualified as a contractor in your state. The process to become a qualified contractor may vary by state and may require industry-standard licensing and certification, proof of insurance, and other information. The National Association of Credit Management has a list of contractor licensing requirements by state.

Home Electrification and Appliance Rebates 

Who is eligible 

This rebate is only for:

• Low- or moderate-income households
• Individuals or entities that own a multifamily building where low- or moderate-income households are at least 50% of the residents
• Governmental, commercial, or nonprofit entities that are carrying out projects for low- or moderate-income households or multifamily building owners

Low-income households refer to those earning less than 80% of their area median income (AMI). Moderate income means a family representing up to 150% of an AMI. The Department of Housing and Urban Development reports AMI statistics across the United States.  Up to 100% of costs will be reimbursed for low-income families and up to 50% for moderate-income families.

What is eligible

Your state energy office decides eligible products and materials. Options include:

• Up to $8,000 for ENERGY STAR-certified electric heat pump for space heating and cooling
  • Up to $4,000 for electric load service center (i.e., electrical panel)
  • Up to $2,500 for electrical wiring
  • Up to $1,750 for ENERGY STAR-certified electric heat pump water heaters
  • Up to $840 for ENERGY STAR-certified electric heat pump clothes dryer
  • Up to $840 for ENERGY STAR-certified electric stove, cooktop, range, or oven
  • Up to $1,600 for insulation, air sealing, and mechanical ventilation

Home Efficiency Rebates

Who is eligible

Households of all incomes are eligible. Lower-income households will get larger rebates. 

What is eligible

Relevant retrofits may include efficient windows, doors, and insulation materials. Your state energy office will determine which products and materials are eligible. Efficiency projects that produce at least 20% in predicted energy savings are eligible for rebates of up to $4,000. 35% in predicted energy savings are eligible for rebates of up to $8,000.

• Becoming an approved home energy contractor — if your small business: 
  • Is already completing energy efficiency projects, contact your state energy office 
  • Needs training to be business-ready, find information on energy efficiency training in your state. 
• Learning the details of your state program: Visit DOE’s website and click on your state to link to its energy office. 

For more information, see our How-To Guide for Home Energy Rebates.