The Inflation Reduction Act (IRA) provides approximately $8.6 billion in total for the Home Efficiency Rebates and the Home Electrification and Appliance Rebates Programs ($4.3 billion each). Over the next fifteen months, these funds will be distributed to every state across the country through a formula funding process. While Congress and DOE have attached some requirements to these funds, state energy offices (SEOs) are responsible for designing specific rebate programs. They will decide which households receive rebates, which technologies they finance, and how the rebate programs serve larger public policy goals.

This guide is designed to help states meet this responsibility and serves as a complement to the detailed guidance released by the U.S. Department of Energy (DOE) this summer. It is informed by the experience and expertise of companies, advocates, and industry experts working in the efficiency, electrification, and distributed energy resource (DER) space. Section One discusses two central goals for these rebate programs articulated by Congress and DOE – reducing household energy burden, and catalyzing market growth in the residential energy sector – and the obstacles to achieving these goals. Section Two provides a quick overview of the twin programs – requirements, options, and applications deadlines. Section Three places the Rebate programs within the context of a larger set of incentives and resources. $8.6B may seem like a lot of money but spread across the states and tribes it is quite finite. One of the challenges faced by SEOs will be finding ways to stretch these funds by stacking, braiding, and substituting them with other incentives and resources. This section dives into that challenge, detailing complementary federal tax provisions, energy assistance programs, and funding mechanisms. While the rules, and practical considerations, about how these resources may be used in conjunction with the Home Energy Rebates can be complex, the takeaway is clear: Federal resources and incentives, as well as those from the state and utility, should be utilized to optimize the Home Energy Rebates.

Section Four brings the information in the first three sections together with United’s expertise to produce a set of 25 recommendations intended to help SEOs design rebate programs that meet the DOE requirements, maximize bills savings, and stretch funds to serve as many homes as possible, while helping catalyze a larger market for DERs.