Incentives for Energy-Efficient Upgrades
Melting polar ice caps, rising sea levels, and extreme weather conditions are just some of the troubling stories dominating headlines today, a constant reminder, if not a warning, that climate change is spelling out a doomsday scenario for the earth. What once was a possibility in the future is now here, and governments worldwide are taking heed.
The passage of the Inflation Reduction Act (IRA) of 2022 is the U.S. government’s response to this impending catastrophe. Knowing that carbon emissions greatly impact climate warming, the government is seeking to reduce these emissions by creating incentives for adopting clean energy technologies and energy-efficient upgrades. These incentives are outlined in the IRA, and homeowners would do well to pay attention because this new legislation gives Americans tax credits and rebates for energy-efficient upgrades to their homes, including updates to their HVAC systems.
What is the Inflation Reduction Act?
Billed as the most significant climate legislation in U.S. history, the Inflation Reduction Act of 2022 was passed by the 117th congress and signed into law by President Joe Biden on August 16, 2022. Clean energy incentives are packaged together with increased corporate taxes and prescription drug reforms to strengthen the nation’s social safety net.
The IRA outlines significant investments in energy security and climate protection, including tax credits to reduce carbon emissions, investments in clean energy production, and tax credits for households to offset energy costs. For homeowners, this translates to savings of up to $3,200 annually to lower the cost of upgrading to more energy-efficient systems such as heat pumps for HVACs and water heaters, insulation, and electrical panels.
Which Systems Are Eligible?
To qualify for IRA tax credits, HVAC systems must be installed beginning in 2023 and meet certain certifications and ratings. All Energy Star Certified ducted heat pumps are eligible for up to $2,000 annually. This also includes all certified mini-split systems with the following ratings:
Energy Star models that are certified for cold climates also qualify if they have the following ratings:
- Ducted with EER2≥10
- Mini-split systems with:
Central air-conditioners and gas furnaces are also eligible for up to $600 rebates. Air conditioning systems that are Energy Star-certified packaged systems and split systems with a rating of SEER2≥16 are eligible. On the other hand, gas furnaces also have to be Energy Star certified with a rating of AFUE≥97%.
Tax incentives are just one of the reasons for upgrading an HVAC system into a more modern, energy-efficient one. For most homeowners, an upgrade is not just inevitable; it is necessary, especially when these systems are aging and require more repair than they’re worth. By upgrading, homeowners don’t just get a newer, more effective HVAC system that provides comfort and improved indoor air quality; they also save on energy bills while helping to reduce the burden of carbon emissions on a steadily warming planet.
About AirLux Heating & Cooling
AirLux Heating & Cooling is a premier HVAC service provider in Niles, MI, and surrounding areas. Having been awarded Best of the Best by Reader’s Choice Awards in 2020, AirLux delivers on its promise of a 3-year labor warranty, 24/7 live answer, and transparent pricing. Their trustworthy technicians provide reliable white glove service that arrives on time. Call them today for dependable HVAC service in Niles, MI.