Electrify your life in 2023 to fight climate change. Here’s help paying for it.
Moving to clean energy – electrifying our houses, cars, and appliances – is widely considered a necessary step to help stave off catastrophic global warming. Now, it may finally be financially feasible, through the federal Inflation Reduction Act – the mammoth clean energy bill Congress approved in August – and various state and local initiatives.
A few caveats to keep in mind: The energy grid is still far from clean. In Oregon, about half of all electricity is produced from renewables, including hydropower, solar and wind. That means the other half comes from fossil fuels, mainly from natural gas and coal from out-of-state plants. House Bill 2021 aims to tackle that problem by requiring the state’s two major power companies to achieve carbon-free electricity by 2040.
All those new electric vehicles (EVs), heat pumps, and induction cooktops will also need a lot more electricity than Oregon currently generates. That means modernizing the grid by building more transmission lines and on-site battery storage. While the endeavor may seem daunting, experts say electricity-generating capacity will increase to meet the higher demand as electrification efforts ramp up.
Here’s what you can do in 2023 to electrify, with the help of rebates and tax credits:
Replace your wood stove or fireplace: The smoke from burning wood for heating indoors carries tiny particles known as PM2.5 which cause burning eyes, runny noses and bronchitis. They can also trigger asthma and heart attacks, strokes and other conditions. Multnomah County residents can swap their wood stove or fireplace for an electric heat pump. Applicants receive a subsidy ranging from $3,000 to full cost of the replacement, depending on eligibility and household income. Renters can also qualify.
Washington County offers similar rebates of $1,500-$4,000 for those replacing an old wood stove or insert with a heat pump, gas stove, or other heating source. Low-income families can qualify for a free replacement. The Oregon Department of Environmental Quality also funds other city and county exchange programs.
Buy a new or used electric vehicle: The transportation sector accounts for more than 40% of Oregon’s greenhouse gas emissions. Gas-powered vehicles not only add to global warming, but also spoil our air quality. Starting in January, Oregonians can qualify for up to $15,000 in rebates and tax credits on new electric vehicles. The state offers two cash rebates for Oregon drivers who purchase or lease electric vehicles or plug-in hybrids under $50,000. The Standard Rebate of up to up to $2,500 is available regardless of income and can be received at participating dealers, while the Charge Ahead Rebate of $5,000 is aimed at low or moderate-income households and must be accessed via a mail-in application. The two rebates can be combined for up to $7,500 cash back.
On top of that, starting on Jan. 1, many Oregonians qualify for a federal tax credit of up to $7,500 for new EVs under the Inflation Reduction Act. Those who buy a used EV can qualify for a $4,000 credit. There are caps on vehicle prices and buyer incomes. In an effort to stimulate the lagging domestic EV market – including battery recycling and mining of source minerals for electric car batteries – and to answer social and environmental justice concerns surrounding such mining across the globe, the legislation includes strict requirements on sourcing for battery components and where parts and vehicles are manufactured. As a result, some consumers may initially be restricted to smaller credits. Starting in 2024, buyers will be able to transfer their tax credits to registered car dealers, meaning an immediate rebate on a new or used EV.
Utilities across Oregon are also offering rebates that support the use of electric vehicles. For example, Portland General Electric has rebates available for residential home chargers. And the federal legislation offers low-income and rural households a 30% tax credit for installing home electric vehicle chargers.
Ditch the gas furnace and get a heat pump: The Inflation Reduction Act offers up to $14,000 in up-front discounts to switch over to electric appliances, including up to $8,000 for a heat pump, which provides heating, air conditioning and hot water. The discount can cover up to 100% of project costs (including purchase and installation) for low-income households and up to 50% of costs for moderate-income households. There’s also a 30% tax credit up to $2,000 available to anyone who purchases and installs a heat pump, in addition to the rebate. Renters can also use the rebates and tax credits because window-unit heat pumps, induction cooktops and heat pump clothes dryers are portable.
While tax credits will be available in January, the exact timing for rebates is unclear. They will become available once states receive federal funding and create rules to administer the rebate programs. Both rebates and tax credit programs are expected to run for about a decade.
Families with lower incomes can also qualify for additional incentives for heat pumps – that can be combined with the federal ones – through Energy Trust of Oregon.
Swap your gas stove for an electric or induction cooktop: A Multnomah County report this fall recommended transitioning away from gas stoves and other gas appliances because they release dangerous air pollutants. Under the Inflation Reduction Act, low-income households that qualify for the full rebate of $840 can get an electric stove or cooktop for just a few hundred dollars, depending on the model they choose. Those who need it can also get a tax credit of up to $4,000 to upgrade their home’s breaker box, and an additional credit of up to $2,500 to upgrade the electrical wiring.
Weatherize your home: The Inflation Reduction Act provides a tax break of up to 30% for residential efficiency and electrification upgrades. This includes up to $1,200 for insulation, $500 for door replacement and $600 for window replacement, among others. The credit covers purchase and installation costs. Its limits are annual, so it resets every year and can be used again and again. Families with lower incomes can qualify for additional incentives for insulation through Energy Trust of Oregon.
Get solar panels: Solar panels help generate clean electricity. And when paired with solar battery storage, they can work during a power outage. The Inflation Reduction Act provides a tax break that translates to 30% off the cost of rooftop solar, home batteries and geothermal systems for your home. The tax break covers labor, permitting fees, inspection and development. It also covers the purchase of stand-alone batteries. There are no income restrictions and no cap on the total spent.
Low- and moderate-income Oregon homeowners are also eligible for a rebate through Oregon Solar + Storage Rebate Program run by the state’s Department of Energy, including up to $5,000 for installing a solar electric system and an additional $2,500 for an energy storage system. And Energy Trust of Oregon provides additional solar incentives for lower income Oregonians, including through the Solar Within Reach program.
Calculate your rebates and tax breaks
Use this Inflation Reduction Act calculator from Rewiring America, a pro-electrification nonprofit, to estimate your savings. You can enter your zip code, household income and size, homeowner status and the calculator will estimate what rebates and tax credits are available to you. Energy Trust of Oregon may offer additional cash incentives.
If you’re unsure what changes to make, the Inflation Reduction Act includes a tax credit of $150 per household for a home energy audit. You can find a private contractor, do a free online home assessment or schedule an appointment with a home energy advisor through Energy Trust of Oregon. For families with lower incomes, community action agencies and other organizations across the state offer free or affordable energy assessments and weatherization services. Portlanders can also sign up with ElectrifyPDX, a new non-profit that aims to guide residents in their transition to all-electric.
– Gosia Wozniacka; [email protected]; @gosiawozniacka
Our journalism needs your support. Please become a subscriber today at OregonLive.com/subscribe/