Last week we covered how battery energy storage systems will help fill the gaps in renewable energy generation—allowing us to achieve a decarbonized electricity grid. So how will we accelerate the transition to an all-electric society? Through the help of Federal and State incentives and local organizations, we can achieve an equitable transition to Electrify Washington.
The Inflation Reduction Act of 2022 (IRA) is the first federal legislation addressing climate change. In the IRA, tax credits and rebates are available for home electrification and renewable energy technologies across the socioeconomic spectrum. Depending on your income level, you can qualify for upfront discounts or tax credits taken out in the following calendar year’s tax filing. Here is a breakdown of critical incentives included in the IRA:
Renewable Energy Technology
Solar energy systems saw an extension to the Solar tax credit for another ten years and an increase of 30%. Previously it was going to phase down to 20% this year and expire in 2024. Battery backup systems qualify for the 30% as a stand-alone project; before the IRA, batteries needed to be paired with solar to receive the tax credit. Lastly, main panel upgrades (MPU) like installing a SPAN with solar or battery qualifies for the 30% tax credit!
A tax credit of $2,000 each for Heat Pump Water Heaters and Heat Pump HVAC systems is available now. Rebates for these Heat Pump technologies are coming in late 2023 at $1,750 and $8,000, respectively. Other rebates coming later in 2023 include Electrical wiring (labor), stovetops, and weatherization. Fortunately, a $4,000 energy efficiency rebate is available now!
Tax credits for used EVs are $4,000, and new EVs have $7,500. The caveat is not all vehicles apply; you can see which do here. Plus, in 2024, this tax credit will turn into a point-of-sale discount.
State and Utility Incentives
Washington state exempts solar and battery energy systems from sales tax through 2029. Utility incentives for EVs vary, but all solar energy systems connected to the grid in Washington have Net Metering. Read about solar incentives here and EV incentives here.
A non-profit, Spark Northwest, brings equity into the energy industry. Educating and managing programs for cities and their projects, Spark Northwest is helping low-income and underrepresented communities electrify and solarize!
Northwest Electric and Solars and Spark Northwests partnership began with Solarize campaigns in 2018. Cities partnered with Spark Northwest to promote a one-off program for homeowners that went solar with the program to receive a monetary credit for energy produced from solar, expediting the return on investment! Expect more announcements and collaboration between us and Spark NW late in Spring!
Spark Northwest is working on Energize campaigns with cities to help electrify home appliances. Heat pump workshops and webinars educate homeowners on expectations and proper processes for purchasing heat pumps. If you qualify for their energize programs, you can get discounts on purchasing and labor for acquiring heat pumps. Ensure that if you are looking for a heat pump water or HVAC system, the contractor conducts a home energy audit to size the heat pump to meet your needs!
Olympia solar is another non-profit in Washington that focuses on community solar and advocacy for vital solar legislation! Identifying that solar ownership is not available to every home in Washington. Community solar allows folks without adequate roofs or the capital to purchase or finance a solar energy system to reap the benefits of solar energy and reduce their bills. Learn more about community solar here!
Next in the Electrify Washington series
Next week is the final blog in the Electrify Washington series about the workforce we need! As we realize the opportunities ahead of us for residential, commercial, and agricultural electrification, we will need the contractors, manufacturers, permit technicians, inspectors, and a slue of labor to turn this movement into a reality. As a result, develop a national, sustainable, and long-lasting electrical and renewable energy economy with well-paying career opportunities.