New Federally Funded Residential Energy Rebate Programs Launching in California

For Immediate Release: October 8, 2024

SACRAMENTO - The California Energy Commission(CEC) today joined with the U.S. Department of Energy(DOE) to announce California is launching the first of two federally-funded Inflation Reduction Act (IRA) Residential Energy Rebate Programs.

Applications are openfor the first phase of the Home Electrification and Appliance Rebates (HEAR or HEEHRAin California), which will provide $80 million for low- and moderate-income (LMI) households to retrofit their homes with efficient electrification projects. Owners and agents of multifamily buildings may apply for rebates on heat pump heating and cooling units and other electric appliances and equipment.

Single-family homeowners will be able to apply for HEERA rebates for new heat pumps for space heating and cooling in the next several weeks.

HEEHRA's rollout is part of the state's strategy to decarbonize California's buildings by encouraging the installation and use of electric appliances; reducing greenhouse gas emissions; and making buildings more efficient, comfortable, and resilient in the face of climate change impacts.

The CEC is distributing the first phase of funds through TECH Clean California, a statewide initiative that focuses on electrification projects. TECH's established community partnerships, network of trained contractors, and coordination with statewide energy utilities will accelerate the uptake of home electrification in low-income and disadvantaged communities and reduce disparities in energy equity. Multifamily building owners can start the application process by checking eligibility at the HEEHRA Rebates web site.

"California has led the way on saving people money while taking climate action. With the help of the Biden-Harris Administration and the historic Inflation Reduction Act, Californians can now get up to thousands of dollars to make the switch to energy efficient appliances," said Governor Gavin Newsom. "Saving money and fighting the climate crisis has never been easier."

"Existing buildings is one of the toughest segments of the housing market to decarbonize to reduce the impacts of climate change. That's why we are so energized to bring the federal Home Energy Rebates to Californians wanting to switch to cleaner, more efficient electric appliances and equipment," said Commissioner Andrew McAllister, lead for energy efficiency at the California Energy Commission. "Starting this week, California is opening up applications for federally funded rebates, thanks to a close partnership with the DOE, to make low-carbon technologies like heat pumps accessible to more Americans."

"California has long been at the vanguard of combating climate change and advancing energy efficiency," said U.S. Deputy Secretary of Energy David M. Turk. "DOE is thrilled to provide nearly $300 million to California through the HEAR program. This investment will build upon California's strong foundation, helping thousands of additional residents enjoy lower energy bills and cleaner air, while strengthening our collective fight against climate change."

INPUT SOUGHT ON HOME EFFICIENCY REBATES PROGRAM

IRA programs also include the Home Efficiency Rebates (HOMES) program, with $291 million in funding allocated for whole-home energy efficiency retrofits for single-family homes and multifamily buildings in California. The HOMES application is currently under review by DOE, with opportunities planned for public input to guide its direction in California. Part of the HOMES funding will support a statewide "Pay for Performance" program through which rebates will be based on actual measured energy savings. The Pay for Performance program will be available to Californians of all income levels.

SUITE OF PROGRAMS BENEFIT CALIFORNIANS AND ADVANCE CLIMATE GOALS

The DOE estimates that the IRA programs will save American households up to $1 billion on energy bills each year, and support over 50,000 U.S. jobs. These programs join a suite of federal- and state-funded programs that are either operating or will be launched soon in California. They are part of the state's strategy to address the impacts of climate change through building decarbonization and will work towards energy equity where all Californians live, work, and learn. Current programs through the CEC include:

• Equitable Building Decarbonization (EBD) programs that fund energy efficiency and electrification home retrofits
  • The Direct Install Program will launch in 2025 to provide no-cost upgrades for low-income residents through $412.95 million in state funds and $154.3 million in federal IRA funds. It will include remediation, energy efficiency, and electric upgrades to existing single-family and multi-family homes as well as manufactured housing. Community-based organizations will provide guidance in screening homes for awards.
  • The Tribal Direct Install Program, with $30 million in funding, is a no-cost direct install that will be open to California Native American tribes and tribal members for existing single family, multi-family, and manufactured housing. The program offers remediation, energy efficiency, and electric equipment. The program is currently in guideline development, with a launch anticipated in 2025-2026.
  • Launching this month, GoGreen Financing has been expanded with $30 million in new state funding. The funding supports interest rate buy-downs and a loan-loss reserve program for participating lenders so that residents may borrow money at low cost to finance energy efficiency improvements and electric appliance installation in their existing single-family, multi-family, and manufactured housing.
• Building Initiative for Low-Emissions Development (BUILD) offers incentives/guidance for new, low-income home construction
  • Launched in 2022, the BUILDprogram's $80 million program budget funds up to 300 hours of technical assistance related to the construction of low-income, single family and multi-family all-electric homes. It also offers incentives to developers and builders of $3,300 per multifamily unit or $5,500 per single family home up to a $2 million program cap per applicant. Funds are allocated to territories throughout California; although some territories are fully-subscribed, guidelines will be updated this fall.
• California Electric Homes Program (CalEHP) offers incentives for new, market-rate home construction
  • CalEHPwas launched in 2023 with a $75 million program budget to encourage the construction of market-rate single-family and multi-family homes and manufactured housing as all electric and/or with energy storage systems. This building decarbonization program is currently accepting applications from developers and builders.
• Energy Conservation Assistance Act (ECAA) loan program for upgrading the efficiency of their existing public buildings
  • ECAAis one of the CEC's oldest and most successful programs. It was authorized in 1979 and offers zero- and low-interest revolving loans. The program was created to help public agencies, local government, and schools upgrade their existing buildings through the installation of energy efficiency measures, photovoltaic panels, energy storage and electric vehicle charging equipment. The program was recently expanded to include applications from tribal governments. There are two types of loans available: ECAA-Regular offers one percent interest loans of up to $3 million to public entities and tribes from a $100 million revolving fund. ECAA-ED offers zero percent interest loans of $3 million to $5 million to public schools (K-12, Offices of Education) from a $130 million revolving fund.

The CEC also provided over $400 million in funding for efficiency retrofits at schools and offices of education through the California Schools Healthy Air, Plumbing, Efficiency (CalSHAPE) program. The program awarded 764 grants to repair ventilation systems and replace ageing and water-inefficient plumbing fixtures and appliances with water-conserving plumbing fixtures and appliances.

For more information about these programs, visit the CEC's Building Decarbonization web page.

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About the California Energy Commission
The California Energy Commission is the state's primary energy policy and planning agency. It has seven core responsibilities: advancing state energy policy, encouraging energy efficiency, certifying thermal power plants, investing in energy innovation, developing renewable energy, transforming transportation, and preparing for energy emergencies.

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