Federal Funding for Buildings

Federal initiatives for decarbonizing buildings

Over the past two years, two major federal initiatives prioritized funding for decarbonizing buildings. The 2021 Infrastructure, Investment, and Jobs Act (IIJA) (also referred to as the Bipartisan Infrastructure Law, or “BIL”) represents an investment of $1.2 trillion for expansive transportation and infrastructure spending. $107.5 billion of this funding is focused on energy, power, and grid reliability, including opportunities for building decarbonization, the advancement of codes, and bolstering of the buildings technologies workforce.

The 2022 Inflation Reduction Act (IRA) directs $500 billion towards accelerating clean energy investments and reducing carbon emissions, in addition to other healthcare and tax investments. The suite of buildings-related rebates and incentives under the IRA will support electrification and efficiency, with a special focus on low-income households. Households will be able to take advantage of a range of up front rebates and tax credits towards energy efficient appliances and energy efficiency improvements in their homes.

The State Energy Office at Commerce is working to make these resources available to households and other partners in a timely, equitable and effective manner.

IRA Rebates 

Rebates will be available through IRA funding, which Washington is expected to receive in mid-2023, and begin to make available in 2024. While the Department of Energy will release guidelines to states in 2023, Commerce is conducting public listening sessions to determine how Washington’s rebate programs will be structured.

This new program will allow rebates at the point of sale for income-eligible consumers on a range of highly efficient electric equipment and electrification projects, including:

  • Heat pumps for space and water heating
  • Heat pump dryers
  • Electric stoves, cooktop range, or oven (includes induction)
  • Electric load service center upgrade
  • Insulation, air sealing, and ventilation
  • Electric wiring

Current Status: The DOE is expected to release funds to states in summer 2023. Rebates will be available in early 2024.

The State Energy Office will receive funding to develop and implement a “HOMES” program, which will provides rebates to homeowners and aggregators for whole-house energy savings retrofits. Rebates will vary by depth of energy savings and income qualification.

Current Status: The DOE is expected to release funds to states in summer 2023. Rebates will be available in early 2024.

Tax Credit

Tax credits under IRA are made available through the Internal Revenue Service (IRS). For more on tax credits under IRA, please visit the US Department of Energy’s Clean Energy Tax Credit webpage.

Solar (electricity), fuel cells, wind turbines, and battery storage are eligible for a tax credit for 30% of the cost in tax years 2023-2032. See the US DOE’s Clean Energy Tax Credit webpage to find a list of eligible products and additional information.

  • Heat pumps, heat pump water heaters, and biomass stoves are eligible for a tax credit of 30% of cost, up to $2,000 per year.
  • Geothermal heat pumps and solar (water heating) are eligible for 30% of cost.
  • Efficient air conditioners, heating, and water heating equipment is eligible for 30% of cost, up to $600.

See the US DOE’s Clean Energy Tax Credit webpage to find a list of eligible products and additional information.

  • Electric panel or circuit upgrades for new electric equipment, and windows (including skylights) are eligible for a tax credit of 30% of cost, up to $600.
  • Exterior doors are eligible for 30% of cost, up to $250 each
  • Home energy audits are eligible for 30% of cost, up to $150.
  • Insulation materials are eligible for 30% of cost.

See the US DOE’s Clean Energy Tax Credit webpage to find a list of eligible services and additional information.

Competitive Grant Opportunities

Name of the ProgramDescriptionProgram MilestonesAmountEligible RecipientsAgency
Building Codes Implementation for Efficiency and Resilience (IIJA)The Building Codes Implementation for Efficiency and Resilience Program is a competitive grant program to enable sustained, cost-effective implementation of updated building energy codes to save customers money on their energy bills.Applications for funding are expected to be open by the end of 2022.$225 millionStates and State PartnershipsDOE- Energy Efficiency and Renewable Energy
Energy Auditor Training Grant Program (IIJA)The Energy Auditor Training Grant Program is designed to provide grants to eligible States to train individuals to conduct energy audits or surveys of commercial and residential buildings to build the clean energy workforce, save customers money on their energy bills, and reduce pollution from building energy use.Estimated application opening date is Q1 2023.$40 millionStatesDOE- State and Community Energy Programs
Energy Efficiency Materials Pilot Program for Nonprofits (IIJA)The Energy Efficiency Materials Pilot Program for Nonprofits is a new U.S. Department of Energy program to provide nonprofit organizations with funding to upgrade building materials to improve energy efficiency, lower utility costs, and reduce carbon emissions.The Request for Information for the program will open on November 10, 2022. Answers must be received by December 22, 2022.$50 millionNonprofit OrganizationsDOE- State and Community Energy Programs
Building Training and Assessment Centers (IIJA)The Building Training and Assessment Centers Program is designed to provide grants to institutions of higher education to establish building training and assessment centers to educate and train building technicians and engineers on implementing modern building technologies.Estimated application opening date, 4th quarter 2022.$10 millionInstitutions of Higher EducationDOE- State and Community Energy Programs
Career Skills Training Program (IIJA)The Career Skills Training Program is designed to provide grants to pay the Federal share of career skills training programs under which students concurrently receive classroom instruction and on-the-job training for the purpose of obtaining an industry-related certification to install energy efficient building technologies.Estimated application opening date, 1st quarter 2023.$10 millionNon-Profit PartnershipsDOE- State and Community Energy Programs
Buildings Energy Efficiency Frontiers & Innovation Technologies (BENEFIT)This FOA will invest up to $45 million across five topic areas to research and develop high-impact, cost-effective technologies and building retrofit practices that will reduce carbon emissions, improve flexibility and resilience, and lower energy costs. Eligible topics include: 1) Heating, Ventilation, and Air Conditioning and Water Heating; 2) Thermal Energy Storage (TES); 3) Battery Energy Storage Systems (BESS); 4) Plug Loads/Lighting; 5) Opaque Building EnvelopeFOA released 12/14/22, Concept paper due 2/7/23$45 millionTechnology developers and demonstration project teamsDOE – Building Technologies Office (BTO)
Equitable and Affordable Solutions to Electrification Prize (EAS-E Prize)This prize offers $2.4 million in cash prizes and technical assistance vouchers to innovators who can help simplify the electrification processes for contractors and implementers. The prize aims to make the process faster and more affordable for homeowners across diverse communities and all housing types.Phase 1 submissions are due by March 8, 2023$2.4 millionAll innovatorsDOE – Building Technologies Office (BTO)

Upcoming Events

We will be hosting public listening sessions in early 2023. Please use the listening session interest form to sign up to be notified when these are announced.

Contact

Liz Reichart, MPA
Sr. Energy Policy Specialist
Homerebates@commerce.wa.gov