“Seize the day” might be a good mantra if you’re exploring your options for reducing your energy costs in 2025. While there is potential for changes to energy programs at both the local and federal levels, there are many incentives currently still available. Don't let fears about the future dissuade you from proceeding with projects that pencil out with the incentives in place when it comes time for you to decide on your project.
At present, we have a federal tax credit of 30% for solar PV, geothermal heat pumps, solar hot water heaters, and batteries. This is the 25D tax credit, which you can read about on the Rewiring America website.
We also have the 25C federal tax credit which would help you to install electrical wiring upgrades, heat pumps, heat pump water heaters, insulation, doors, and windows. These credits are equal to 30% of your post-incentive costs, up to certain caps.
In addition to the two tax credits above, federal funding from the Inflation Reduction Act (IRA) has been allocated for rebate programs to be administered by the states. However, the status of this funding is unclear at the moment due to the Executive Order issued by the president. Note that the Massachusetts, Rhode Island, and 22 other state attorney generals are actively challenging this Executive Order. Regardless of this dispute, don’t let the uncertainty about these IRA rebate programs deter you from getting quotes and moving forward on any projects that are doable with the tax credits and state incentives, because the amount of funding for the IRA rebates is relatively small in comparison to the state energy efficiency programs. For the latest information about the IRA rebates, see here for MA and here for RI.
Rhode Island
In Rhode Island, the state-run Clean Heat Rhode Island incentive program for switching to heat pumps is currently fully subscribed and not accepting new applications. The Federal Home Electrification and Appliance Rebate (HEAR) program, which offered rebates to low-income individuals for electrical upgrades and energy-efficient appliances, is currently paused due to federal funding uncertainty. However, Rhode Island Energy continues to offer rebates for switching to heat pumps and heat pump water heaters when replacing electric resistance heating and electric tanks, as well as various energy efficiency programs. Additionally, Clean Heat Rhode Island still provides free heat pump consultations, quote comparisons, and resources to help find qualified installers. Rhode Islanders interested in switching to heat pumps are encouraged to take advantage of these free services and stay informed through the RI Office of Energy Resources website for updates on when rebates may resume.
Massachusetts
In Massachusetts, Mass Save has a great array of incentives available for customers of Eversource, National Grid, Cape Light Compact, and other investor-owned utilities. For anyone who needs to replace a heating system this year, you can expect generous incentives if you decide to convert your heating to a heat pump system. The same is true for heat pump water heaters and smaller appliances like clothes washers, dryers, and stoves. Rebates vary depending on the size of your building and other factors. Start exploring your options by visiting the Mass Save website.
One of the most valuable offerings from Mass Save continues to be its Decarbonization Consultations. These 45-minute phone or video conversations with impartial professionals are designed to give you advice about your specific home’s pathway to converting all of your appliances to electric options. Especially if you are considering replacing a fossil fuel heating system, we cannot recommend highly enough the consumer protection value of the Mass Save Decarbonization Consultations. Schedule your consultation online (now available in 6 languages).
For those communities outside of Mass Save’s service territories, many of the municipal light and power companies have good incentives for energy efficiency. Free, impartial decarbonization consultations are available to residents of Belmont, Braintree, Concord, Hingham, Middleborough, Norwood, Reading, Taunton, Wakefield, and Wellesley. For these and other municipal power towns, check with your town energy office for details.
Also, electricity rates charged by municipal utilities are significantly lower than those charged by investor-owned utilities (National Grid, Eversource, Unitil, and Rhode Island Energy). Therefore, the economics of electrification is generally excellent in those communities.
Both States
EnergySage is another good source of advice on heating system replacements and other decarbonization questions in both RI and MA (and nationwide). Whether you're looking for heat pump or solar installers, or just good overviews of decarbonization topics, EnergySage offers vetted contractors, trusted analysis, and knowledgeable advising. And because contractors know they are bidding against other companies, consumers get more affordable quotes than if they separately contact potential installers. We also love the fact that installers won't get your contact details until you've chosen which ones you want to spend time talking with.
It's clear that there are still opportunities to invest in energy-efficient solutions today, despite uncertainty about some incentives. Don’t let the fear of future changes hold you back; explore your options and take advantage of the current incentives that make now the perfect time to invest in a more energy-efficient and cost-effective home.
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