If your morning routine has become a game of cold water roulette, it may be time to upgrade your water heater. Fortunately, the United States government wants to give you up to $1,750 to switch to an energy-efficient option that could save you hundreds of dollars annually.
The nearly $400 billion Inflation Reduction Act (IRA) allocated $8.8 billion for home energy rebates when President Joe Biden signed the legislation in 2022. Basically, in order to snag some of this cash, you just have to electrify your home.
Purchasing and installing a heat pump water heater is one of the projects that qualifies. Water heating makes up nearly 20% of the typical American household's utility bill, but adopting this device can result in significant savings.
That is because heat pump water heaters are two to three times more efficient than conventional water heaters, according to the U.S. Department of Energy. Some homes could even cut their utility bills by as much as $550 over a year.
Beyond the financial perks, electrifying your home helps create a healthier and cooler tomorrow. The toxic fumes from dirty fuels are directly associated with severe health problems, including heart attacks, respiratory issues, strokes, and premature death. One study from Harvard found that air pollution from these fuels caused 1 in 5 deaths globally in 2018.
However, as the Environmental Protection Agency detailed, increasing energy efficiency reduces the fuel needed to create electricity — thus eliminating large amounts of planet-warming pollution if a grid still uses dirty sources like gas, oil, or coal.
(The United States has a number of projects in the works to transition to a cleaner grid but still overwhelmingly depends on dirty energy.)
If you're ready to begin taking advantage of tax rebates and incentives in the IRA, the process can be straightforward thanks to tools like those from the nonprofit Rewiring America.
Instead of scanning the 700-plus legislation by yourself, you can answer a few simple questions in Rewiring America's free incentive tool, which does all of the calculations for you, making it easy for you to maximize the savings on upgrades to your home.
"I LOVE my heat pump water heater," one person shared with The Cool Down. "It is helping us save money because it's more efficient, got the gas out of our house, and has worked like a charm."
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