Austin’s High-Efficiency HVAC Rebates

Inflation Reduction Act HVAC Rebates

The Inflation Reduction Act of 2022 (IRA) stands as the most substantial climate investment made by the Federal Government in American history. It is anticipated to diminish greenhouse gas emissions by 31-44% below 2005 levels by the year 2030 and aims to provide economic relief to households across the United States by encouraging the adoption of highly efficient, all-electric appliances, thereby reducing energy bills.

• Allocates $4.5B in grants for energy-efficient improvements
• Designed to provide economic relief for homeowners
• Projected to reduce greenhouse emissions 31%-44%

The High-Efficiency Electric Home Rebate Program (HEEHRP)

One of the key programs under the IRA is the High-Efficiency Electric Home Rebate Program (HEEHRP). This program aims to support both individual households and broader environmental sustainability goals. By taking advantage, homeowners can receive substantial cost offsets, specifically for heat pump installations. The maximum offset for a single home is $14,000, with specific caps on rebates per qualified equipment type. Heat pumps qualify for a maximum rebate of $8,000.

• $8,000 cost offset for heat pumps
• Single-home maximum cost offset of $14,000
• Designed to support low-to-moderate-income households

Extended Tax Credits with 25C

Under the IRA, the lifetime tax credit limit has been removed, and the tax credit percentage has been increased from 10% to 30% of both the equipment and installation costs. This tax credit is no longer limited to primary residences, making it applicable to various types of properties. This extension and enhancement of the tax credit offer additional financial incentives for homeowners considering HVAC system replacements.

• 10-year extension and expansion of existing 10% tax credit to 30%
• Tax credit increases up to $2,000 for buying and installing qualified heat pump
• Households may claim annually through 2032

HOMES Rebate Program

The HOMES Rebate Program is a significant initiative aimed at promoting home energy efficiency improvements. The program offers rebates based on DOE-approved modeling tools, with an additional bonus for low-income individuals. The rebate amounts are determined by the modeled energy savings achieved through retrofit projects in both single-family and multifamily homes, measured in kilowatt-hours (kWh) or kWh equivalents. Eligibility for the rebates varies based on the energy reduction achieved.

• Homes that achieve a 20% reduction are eligible for a maximum rebate of $2,000
• Homes achieving a  35% energy reduction are eligible for $4,000
• Homeowners earning less than 80% of the local median income can benefit from double the standard rebate amounts

Austin Energy Rebates

Austin Energy can help you save money when you replace your old air conditioner with a qualifying energy-efficient unit. Rebates average $350, and to qualify, you only need to meet a few requirements: you must receive electricity from Austin Energy and the air conditioning system you're replacing and your home must be at least 10 years old.

Rebates are available only for replacing existing equipment, not for new installations or for air conditioning systems with electric resistance heating elements.  

• Homes that achieve a 20% reduction are eligible for a maximum rebate of $2,000
• Homes achieving a  35% energy reduction are eligible for $4,000
• Homeowners earning less than 80% of the local median income can benefit from double the standard rebate amounts

Qualifying for HVAC Rebates in Austin

To qualify for the rebates, your heat pump system must meet ENERGY STAR® criteria. This ensures that the systems you install are highly efficient and environmentally friendly, further contributing to your energy savings and reducing your environmental footprint.

The programs under the Inflation Reduction Act prioritize assistance for low-to-moderate income (LMI) households. For example, households with up to 80% of the area median income can receive a 100% rebate of up to $8,000 for heat pump installation. Moderate-income households (earning 80-150% of the area median) are eligible for a 50% rebate within the same limits.

If your air conditioner is due for an upgrade, contact us today to learn more about how you can enjoy the benefits of energy-efficient cooling while taking advantage of Austin’s energy rebates.