Two bills introduced in the U.S. Senate last month aim to support the transition to heat pumps from fossil-fuel heating sources for space and hot-water heating.
The bills are the Heating Efficiency and Affordability through Tax Relief (HEATR) Act and Installing Clean Efficient Energy Hastens Our Transition (ICEE HOT) Act. Neither bill referred to the refrigerants used in heat pumps.
The HEATR Act, introduced by U.S. Senator Amy Klobuchar (Democrat-Minnesota) creates a manufacturer tax credit to incentivize production of “high-efficiency, safe, and affordable heat pumps,” said an announcement of the bill from Klobuchar.
“This legislation is a win-win – reducing energy costs for consumers, while strengthening access to clean, energy-efficient heating solutions,” said Klobuchar. “As we continue transitioning to a clean energy economy, increasing production of heat pumps will be critical to lowering emissions and helping families across our state get the affordable heating they need.”
According to the announcement, the HEATR Act will:
- Expand access to clean, affordable heating solutions. Making it easier for landlords to purchase more efficient technology will allow more renters to benefit from the tax credit.
- Transition the space and water heating market to provide clean, affordable, safe heat and hot water at no extra consumer cost.
- Spur domestic job creation by requiring equipment to be manufactured in the U.S.
- Make more efficient use of taxpayer dollars by targeting the tax credit to where it will have the biggest impact.
Heat pumps operate on average at two-to-four times the efficiency of a regular furnace or boiler, while reducing electricity usage by approximately 50% over traditional electric heating, according to the Department of Energy.
“Now is the time to accelerate adoption of these technologies, and this manufacturer tax credit will be a key driver to help the supply chain prioritize and promote them,” said Chris Duffrin, Center for Energy and Environment President.
“The HEATR Act implements the recommendations of CLASP’s 3H Hybrid Heat Homes proposal by incentivizing manufacturers to transition from one-way air conditioners to reversible heat pumps, said CLASP Director Matt Malinowski. “Around half of US homes have a central air conditioner—what if that equipment could also provide heating?”
CLASP has found that making this one change in U.S. homes can reduce their fossil fuel consumption by almost 40%, while strengthening energy independence and reducing utility bills and carbon dioxide emissions, added Malinowski.
More rebates for heat pumps
The ICEE HOT Act, introduced by Senator Edward J. Markey (Democrat-Massachusetts), would expand the State Energy-Efficient Appliance Rebate Program with incentives for manufacturers and distributors that produce and distribute American-made building electrification products, like heating, ventilation, air conditioning (HVAC) equipment and water heating appliances.
“This legislation will not only transform the heat pump market, encourage home electrification, and improve grid reliability, but it will also lower equipment costs for consumers,” said the announcement of the bill from Markey.
“The ICEE HOT Actwould transition homes across America away from costly, dirty fossil fuels towards cheaper, cleaner renewable energy,” Markey said.
The ICEE HOT Act would appropriate $10 billion for the issuance of manufacturer and distributor rebates from fiscal year 2023 to 2030. According to the Markey announcement, the legislation would offer benefits to stakeholders across the supply chain, including:
- Manufacturer rebates that support original equipment manufacturers
- Distributor incentives that encourage distributors to provide zero-emission home heating systems when residents are faced with replacing HVAC and water heating systems
- Rebates available for building electrification products such as residential air source heat pumps, cold climate heat pumps, heat pump water heaters, heat pump clothes dryers, induction or non-induction electric stoves, and smart panels
- Cost benefits to residents and homeowners
“Outdated furnaces powered by oil, propane, and gas pollute our homes, contaminate our air, and disproportionately harm underrepresented communities,” said Earthjustice Associate Legislative Representative Jake Kornack. “Heat pumps are a game changer and provide a more affordable and cleaner alternative to heat and cool our homes.”
“This legislation is a win-win – reducing energy costs for consumers, while strengthening access to clean, energy-efficient heating solutions.”U.S. Senator Amy Klobuchar (Democrat-Minnesota)
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