The Inflation Reduction Act (IRA), which was passed into law in 2022, has been offering rebates for homeowners willing to install planet-friendly home appliances like heat pumps and induction stoves. However, due to bureaucratic reasons, consumers have yet to see any of those rebates — but that could be changing soon.
Because the IRA stipulated that the funds from the $8.8 billion rebate program need to be distributed through individual states, which involves an application process, homeowners haven't been able to claim any of the money yet. But as of late February, Bloomberg reported that four states — California, New York, New Mexico, and Hawaii — had at least begun that application process with the U.S. Department of Energy (DOE).
The DOE shows states' progress toward the rebates on an updated online tracker.
If you live in one of the states with a pending application and you are considering the switch to more energy-efficient, less-polluting appliances, you may want to wait just a little bit longer, because big savings could be right around the corner.
That said, the DOE recommends not to wait if you urgently need an upgrade and points out that "you can go to energy.gov/save for more information on energy-saving purchases that qualify for rebates and tax credits." Also, retroactive rebates might eventually be available for projects dating back to August 2022, and the DOE suggests contacting your state's energy office to find out if you can access this benefit.
Per Rewiring America, the IRA incentives include a rebate of up to $8,000 for a heat pump, which can both heat and cool a home, up to $1,750 for a heat pump water heater, up to $840 for an induction stove or heat pump clothes dryer, and up to $4,000 for electrical systems upgrades.
Homeowners could save up to $14,000 total by taking advantage of the program, depending on income — all while reducing long-term energy costs, reducing air pollution in their own homes, and helping the planet.
As the home appliances rebates from the IRA become easier (i.e., possible) to claim, other incentives from the IRA may become more limited — namely, the tax incentive for purchasing an electric vehicle. Starting in 2024, fewer models of EVs have been qualifying for this credit due to regulations phasing in stricter requirements around battery components and mineral standards, as NerdWallet noted. However, the available EV rebates will now be applied upfront, as NPR has pointed out.
All that said, for anyone who, say, lives in California, purchased an EV in the past few years, and is now considering upgrading to a heat pump and induction stove, the IRA could really pay off.
It is not yet determined when the applications will go through and the rebates will go into effect, but Claudia Rapkoch, the public affairs officer with the Hawaii State Energy Office, told Bloomberg, "Our current plan is to phase in a limited rebate offering beginning in the second half of 2024, with the aspirational goal of having the program fully operational by the end of 2024, contingent on DOE approvals."
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