Iowa’s application for federal home rebate program could provide big savings for homeowners’ efficiency upgrades

Although Gov. Kim Reynolds signed and submitted a request for Iowa to enroll in the federal Home Energy Rebate programs, it is unclear when Iowans will receive rebates for their electric appliances and home upgrades due to President Donald Trump’s executive order.

Trump signed an executive order — called “Unleashing American Energy” — on his first day in office last week. It directs federal government agencies to immediately pause the disbursement of funds through the Inflation Reduction Act because of a “national energy emergency.”

The home rebate programs are funded through the Inflation Reduction Act, which was passed in 2022, under the Biden-Harris Administration.

Kristen Hanks-Bents, energy division administrator for the Iowa Economic Development Authority, said the state will have to wait to see what happens with the program.

“Since there's a pause at the federal level, we are trying to assess how to handle it … we just have to wait, really, for the federal government to reach out with whatever questions they have about our application, or to begin negotiations with on the award itself,” she said.

The Home Energy Rebate programs — which include the Home Efficiency Rebates and Home Electrification and Appliance Rebates — will put money back in the pockets of Americans when they purchase clean energy equipment and upgrade electric appliances that improve energy efficiency.

“It’s going to be a while, possibly months, before the program launches,” said Kanan Kappelman, marketing and communications team lead for the Iowa Economic Development Authority.

The Inflation Reduction Act authorized $391 billion in spending on energy and climate change, including roughly $35 billion of clean energy investments managed through the U.S. Department of Energy. About $8.8 million was allocated for home rebates specifically.

Although Reynolds submitted Iowa’s application for both rebate programs on Friday, Jan. 17 — before Trump signed his executive order — Kappelman said the Department of Energy (DOE) must approve Iowa’s application and negotiate the award with Iowa’s Energy Office before Iowans can begin benefiting from the program.

After the DOE approves it, Kappelman said the Iowa Energy Office will design an “implementation blueprint” for the program and submit it for DOE approval.

Kappelman said the Iowa Energy Office is currently waiting for the DOE to reach out with questions about the state’s application and to begin program negotiations.

Although it could be months before the program takes effect, Hanks-Bents said the state has received a conditional award, which means the programs will be available to Iowans if the state successfully negotiates the program terms with DOE.

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“We understand that there still is quite a lot of work to do to get the programs finalized and available for Iowans,” Kerri Johannsen, energy program director with the Iowa Environmental Council, said in an email to The Gazette. “We are excited to help get the word out once these rebates become available.”

Kappelman said the state applied for $121,178,511. When the program is launched, Iowans will be able to apply for a rebate out of that pool of money.

According to the DOE’s HERS progress tracker, all states except South Dakota had submitted an application for the HERS program as of Monday. Thirteen states have rebates available currently, including Midwest states Michigan and Wisconsin.

American territories including the Virgin Islands, American Samoa, Northern Mariana Islands, Guam and Puerto Rico have been awarded funds as well.

How can Iowans use this?

An application portal eventually will be available for Iowans to apply for rebates, Kappelman said.

Hanks-Bents said the Iowa Economic Development Authority will likely “soft-launch” the application portal for Iowans before launching it more broadly.

“We will definitely be trying to make sure that we are making this a consumer-friendly website, so that it's equally understandable,” Hanks-Bents said. “We'll be working with energy contractors prior to the release and prior to the launch of the rebates. But it's just very early. We don't have things firmed up enough yet for me to offer much in the way of detail.”

Appliances eligible for a tax rebate vary from heating equipment and heat pumps to electric ovens and stoves. Home upgrades that will be eligible for a rebate include work to ventilation systems and electric wiring, along with upgrading windows and exterior doors on homes.

A full list of the appliances and home upgrades that are eligible for rebates can be found on the DOE’s website. Through the DOE’s portal, users can see how much money they could receive in their rebate by appliance or upgrade.

To be eligible for a rebate, consumers must have their appliances or projects installed through a program-approved contractor.

The rebate amount is contingent on where the consumer lives and what they purchase through the two Home Energy Rebate programs. Homeowners can save up to $8,000 with efficiency rebates, while electrification and appliance rebates can provide a household with up to $14,000 in rebates.

For example, homeowners could save $4,000 for a new electric panel and $2,500 for electrical wiring.

“We know the state worked hard to put together the energy efficiency grant applications and we are so excited to see the awards come through,” said Johannsen. “This funding will bring some much-needed relief to people in Iowa struggling with high energy bills and create significant new business for local contractors as well.”

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Even though the rebates aren’t available yet, Tom Carsner, political director for the Iowa City Area’s chapter of the Sierra Club, said this is a step in the right direction.

This program “is intended to make these items affordable. It'll pay off on your utility bills for years to come,” Carsner said. “It’s a financial benefit, but it is also great for the environment because of the energy efficiency and energy use reduction. It’s effective in multiple ways.”

Olivia Cohen covers energy and environment for The Gazette and is a corps member with Report for America, a national service program that places journalists in local newsrooms to report on under-covered issues.

Comments: olivia.cohen@thegazette.com