President Trump calls H.R. 1, the budget-reconciliation measure he signed into law last week, his “Big Beautiful Bill,” but taxpayers with clean-energy ambitions might be wont to add another b-word—brutal—considering its rollback of Biden administration clean-energy incentives.
That statute’s whack at the Inflation Reduction Act’s tax credits for electric vehicles takes effect first: You only have until September 30 to buy or lease a qualifying EV, too soon for many car shoppers who were waiting to see a preferred model switch to a Tesla Supercharger-compatible North American Charging Standard plug.
But that’s only the beginning of the bad news for climate-conscious customers in Chapter 5 of the budget bill, titled “Ending Green New Deal Spending, Promoting America First Energy, and Other Reforms.” (That title is misleading; the “Green New Deal” program unsuccessfully pitched by some Democrats featured far more aggressive clean-energy measures than the Inflation Reduction Act.)
The One Big Beautiful Bill Act (OBBBA) grants only three more months of leniency to that 2022 statute’s two other key clean-energy tax incentives, its Energy Efficient Home Improvement Credit and its Residential Clean Energy Credit.
The former offers a menu of tax breaks to offset the costs of individual home-energy improvements, ranging from a $150 credit for having a home energy audit to a $2,000 credit for installing an electric heat pump. The latter offers a 30% credit for the cost of clean-energy home hardware like rooftop solar panels, geothermal heat pumps, and whole-home batteries.
Both credits would have run through 2032, plus an extra two years of phasedown for the Residential Clean Energy Credit, but the OBBBA zeroes them out after December 31 of this year. To qualify for the energy-efficiency credit, you’ll need to have placed that improvement in service by then; to get the clean-energy credit, you’ll need to have spent money on that upgrade by then.
The budget bill offers a longer reprieve to a third IRA incentive, replacing the Dec. 31, 2032 expiration for its tax credit for installing an EV charger at home with a June 30, 2026 deadline.
That may not matter if you don’t live in a qualifying location, as the rules for that credit—30% of equipment expenses, up to $1,000—limit it to census tracts designated as “low-income” or “non-urban.” Checking your home’s eligibility requires plugging its address into a Census Bureau page to get your census tract’s “GEOID” and then pasting that 11-digit identifier into the IRS page covering this credit.
But Republican zeal to hit the “undo” button on not just President Biden’s environmental achievements but those of past GOP administrations, such as the Energy Star program launched under President George H.W. Bush, did not extend to cancelling two other IRA incentives.
These rebate programs, run by the Department of Energy instead of the Department of the Treasury and funded by money already allocated to 49 states to dispense (the outlier, South Dakota, turned down those federal funds last year), somewhat duplicate the functions of the IRA’s energy-efficiency tax credit. The Department of Energy’s press office did not respond to PCMag’s request for comment.
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(The Treasury Department’s guidance from last summer says you can stack one of those rebates with the energy-efficiency credit as long as you deduct the rebate from your own costs before putting in for the credit.)
The Home Electrification and Appliance Rebates (HEAR) program provides the most generous support—as much as $8,000 for a new electric heat pump—but is limited to households with incomes below 150% of the local median household income.
The Home Efficiency Rebates Program (HER, sometimes also referred to as HOMES), meanwhile, offers up to $4,000 for a project that improves a home’s efficiency by 15% or more, then doubles that for households below 80% of local median household income. Those projects can include heat pumps, subject to state-level eligibility and application rules.
The Glaring Problem With the Rebate Programs
Which brings up a glaring problem with both rebate programs: how few states have implemented them. A tracker of HEAR and HER support run by Atlas Public Policy, a Washington, D.C.-based research firm, shows only 12 states and the District of Columbia have HEAR programs operational; of them, five plus D.C. also have HER programs established.
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“While states are required to provide retroactive rebates for projects begun on or after August 22, 2022, the projects must meet all the federal and state requirements,” Ari Matusiak, CEO of Rewiring America, tells PCMag in an email. “So, completing a project before a state releases its requirements does carry a certain amount of risk.”
(Rewiring America, set up to help residents replace fossil-fueled appliances with cleaner electric-powered ones, had to lay off much of its staff after the Trump administration froze grants allocated to it.)
“Some states have kept to their original timelines, some have had their own struggles setting up new programs, and some are back on track after hiccups,” Matusiak says. “But many states are stuck in limbo when it comes to implementation. The Department of Energy is reviewing past approvals but has not given a clear timeline for completion, stalling program launches across 36 states and five territories.”
Matusiak advises homeowners considering a project that might qualify for either rebate to check with their state’s energy office.
IRA advocates have admitted that these intersecting provisions can be confusing to interpret, even to careful readers of the Biden administration’s guidance about them.
Much of that guidance, such as the policy handbook posted at cleanenergy.gov, has since fallen victim to the Trump administration’s digital deletion of unwanted programs. But that page lives on at the government’s archive of the Biden administration’s White House site as a small reminder of what the Trump administration wants to sweep into the ash heap of history—presumably a coal ash heap.
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