How to Upgrade and Electrify Millions of US Homes and Buildings

This guide by RMI outlines how US states can maximize the impact of $8.5 billion in home energy rebates provided by the Inflation Reduction Act (IRA). It details two primary programs—the Home Efficiency Rebates and the Home Electrification and Appliance Rebates—and proposes three strategic actions for states: prioritizing low-income and disadvantaged communities, stacking multiple incentives to reduce upfront costs, and developing complementary state-level policies to scale building retrofits and workforce training.

• The Inflation Reduction Act (IRA) has established two major home energy rebate programs: the Home Efficiency Rebates program, offering up to $8,000 per household, and the Home Electrification and Appliance Rebates program, providing up to $14,000. These programs aim to support the adoption of induction stoves, all-electric heat pumps, and improved insulation. Together, they are expected to create 50,000 clean energy jobs and generate $1 billion in annual energy cost savings for consumers.
• RMI analysis indicates that replacing a gas furnace with a heat pump in any of the 48 continental states could lower climate pollution by as much as 93 percent, depending on the specific state.
• To ensure equitable distribution, the Department of Energy (DOE) requires states to implement funding floors for low-income households. Approximately 40 percent of funds must be invested in low-income households and 10 percent in low-income multifamily housing. The Home Electrification and Appliance Rebate (HEAR) is specifically reserved for moderate-income households (81–150 percent area median income) and low-income households (less than 80 percent area median income).
• States have until January 2025 to apply for and establish these programs. RMI recommends three foundational actions to maximize impact: prioritizing disadvantaged communities, 'stacking' federal, state, utility, and local incentives to eliminate upfront costs for whole-home retrofits, and creating supporting policies such as workforce training via Contractor Training Grants and pairing energy efficiency with electrification to ensure HVAC equipment is correctly sized.

APA

RMI (2023). How to Upgrade and Electrify Millions of US Homes and Buildings. https://rmi.org/resources/how-to-upgrade-and-electrify-millions-of-us-homes-and-buildings/

Chicago

RMI. How to Upgrade and Electrify Millions of US Homes and Buildings. 2023. https://rmi.org/resources/how-to-upgrade-and-electrify-millions-of-us-homes-and-buildings/.

Wikipedia

{{cite report |author=RMI |title=How to Upgrade and Electrify Millions of US Homes and Buildings |date=11 August 2023 |url=https://rmi.org/resources/how-to-upgrade-and-electrify-millions-of-us-homes-and-buildings/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2023how, author = {{RMI}}, title = {{How to Upgrade and Electrify Millions of US Homes and Buildings}}, institution = {RMI}, year = {2023}, month = aug, url = {https://rmi.org/resources/how-to-upgrade-and-electrify-millions-of-us-homes-and-buildings/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }