March 22, 2023
If you’ve been thinking about replacing your furnace with a heat pump or mini split heat pump in the Hampton Roads area, there’s no better time than now! With new incentives and tax credits for heat pumps available from the Inflation Reduction Act, heat pumps are more affordable than ever.
Why Choose a Heat Pump?
Heat pumps transfer heat instead of creating it, making them one of the most energy efficient HVAC systems available. While furnaces generate heat with oil, natural gas, propane, or electricity, a heat pump uses a refrigerant to transfer heat in or out of your home. This gives them the ability to both heat and cool your home. In addition to simplifying your heating and cooling into one unit, heat pumps also provide several other benefits, like:
Lower Energy Costs
The Department of Energy reports that heat pumps can reduce your electricity usage for heating by around 50%. They can also transfer 300% more energy than they consume, meaning you’ll be seeing decreased energy bills.
Improved Safety
Traditional furnaces use combustion to create heat. This means they run the risk of gas leaks or carbon monoxide poisoning. Since heat pumps don’t generate heat, this risk is eliminated.
Increased Comfort
Heat pumps can provide more consistent temperatures in your home because they constantly transfer heat instead of rapidly heating batches of air like a traditional furnace. They can also run as a dehumidifier and improve the indoor air quality of your home.
Inflation Reduction Act Heat Pump Incentives
The Inflation Reduction Act, also known as the IRA, was passed in 2022 and offers several incentives for homeowners in Virginia and North Carolina to replace their inefficient furnaces with heat pumps. Here’s what you need to know:
IRA Heat Pump Tax Credit
The IRA introduced a new 30% federal tax credit for heat pumps and other energy efficient HVAC systems. There is a $2,000 maximum credit for electric heat pumps, mini split heat pumps, and heat pump water heaters. To qualify for the IRA tax credit, homeowners can file IRS Form 5695 with their annual tax returns.
IRA Heat Pump Rebates
The Inflation Reduction Act also created the Home Owner Managing Energy Savings (HOMES) and High-Efficiency Electric Homes rebate programs. These two new rebate programs will offer rebates for a variety of energy efficiency home improvements, including heat pump installation.
The funds have been allocated for the rebate programs, but they aren’t available quite yet. Each state will need to determine how and when they plan to implement them. Russell’s is keeping a close watch on updates, and we will provide an update here as soon as we have more information.
Why You Should Act Now
While it may seem like a good idea to wait for the heat pump rebates to become available, that isn’t necessarily the best option. The cost of energy—regardless of the source—is continually rising, and the best way to start saving now is to cut usage as soon as possible. The cost of labor and materials is also increasing, which means you may not get the best savings by waiting for heat pump installation.
The IRA tax credits are available now, and they’re pretty substantial on their own. Since each state is responsible for applying for and distributing the IRA rebates, there is still a lot in the air on if or when they’ll be available for homeowners. If you want to maximize your savings with a heat pump or mini split heat pump, don’t wait. Start saving on energy costs and make your home more comfortable today.
Call Russell’s For Heat Pump Installation
Russell’s has been a part of the heating and cooling industry in Virginia and North Carolina for decades and we can help with heat pump installation. We can even guide you through qualifying for the IRA heat pump tax credit. Are you ready to make the change and upgrade to a heat pump for a more efficient and comfortable home? We make it easy.
