The Inflation Reduction Act (IRA) introduced and expanded tax credits for clean energy technologies including game-changing new provisions that enable tax-exempt and governmental entities—such as states, local governments, Tribes, territories, and nonprofits—to take an active role in building the clean energy economy.
The IRA also invested billions of dollars in rebate programs aimed at providing low- and middle-income households point-of-sale discounts on high-efficiency home appliances and equipment and reducing the upfront cost for all households that take whole-home measures to increase energy efficiency. The Alaska Housing Finance Corporation is currently developing these programs to be implemented across the state.
And the USDA’s Rural Energy for America Program (REAP) provides guaranteed loan financing and grant funding to agricultural producers and rural small businesses for renewable energy systems or to make energy efficiency improvements. Agricultural producers may also apply for new energy efficient equipment and new system loans for agricultural production and processing.
Solar panels at Renewable Independent Power Producer’s Houston solar farm.
More resources related to the clean energy tax credits available through the IRA:
IRS Two-Pager on IRA Tax Credits for Organizations
IRS Two-Pager on IRA Tax Credits for Individuals
Energy Savings Hub
U.S. Department of Treasury’s IRA Landing Page
IRS One-Pager on Residential Clean Energy Credit (25D)
IRS One-Pager on IRA Direct Pay
IRS Webpage on Elective Pay and Transferability
Pre-Filing Registration Tool User User Guide and Instructions
List of Tax Credits Eligible for Elective Pay IRA-Related Tax Guidance
More resources related to USDA’s REAP:
USDA REAP Webpage
USDA REAP Fact Sheet
Technical Assistance Sign Up Link for REAP
REAP Renewable Energy Systems & Energy Efficiency Improvement Guaranteed Loans & Grants Application
More resources related to AHFC rebate programs:
AHFC Approved Energy Rater/Inspector List
Alaska Residential Energy Rebates Webpage and Updates Sign Up
Income Limit Information from 2024 Fiscal Year
There will be an AHFC energy rebate stand-alone site, but it is not quite ready for launch. REAP will be sure to promote when it is ready!
Each of the panelists graciously offered to answer any questions as individuals decide what clean energy investments make the most sense for themselves. Please reach out to REAP at info@realaska.org, and we will be happy to connect you with any of the panelists.
Prompted with questions from REAP Program Manager for the Alaska Network for Energy Education & Employment (ANEEE) Jenny Starrs, panelists discussed how Alaskans can take advantage of funding for each of the funding opportunities.
From solar installations to electric vehicle investments, Ryan Whalen and Rachel McCleery from the White House made it clear there are dozens of federal tax credits available to businesses, homeowners, non-profits, and government institutions for clean energy projects. Ryan noted that the tax codes are not competitive–meaning that all eligible individuals will receive the credit–and mostly uncapped at the individual and national level until 2032–meaning that individuals and institutions have the opportunity to think big about their clean energy investments. To learn more about all the available tax credits for individuals and what documentation is required to receive them, check out energy.gov/save.
And since it is a relatively new process, Rachel provided an overview of how elective pay–also known as direct pay–works. Elective or direct pay is a mechanism that allows tax-exempt institutions such as non-profits, churches, and schools, to take advantage of federal tax credits that would otherwise be unavailable to them to help plan their own clean energy projects with federal tax reimbursement.
Ryan added that the federal tax credits for clean energy projects can generally be stacked with federal and local grants, like the USDA REAP energy efficiency and renewable energy project grants, for example.
Dan Smith from USDA’s REAP discussed some of the already successful energy efficiency and renewable energy projects that he’s helped get USDA REAP grant funding in Alaska. USDA’s REAP grants can be up to 50% of the cost of the total eligible project cost, with a cap of $1,000,000 grant funds for renewable energy projects and $500,000 for energy efficiency projects. From building a power line connecting a sawmill to an existing hydroelectric project in Southeast Alaska to installing rooftop solar on a variety of small businesses in Fairbanks, Dan expressed his enthusiasm for helping small businesses and agricultural producers in Alaska adopt clean energy projects. USDA’s REAP accepts applications anytime, which they review on a quarterly basis.
Ethan Stoops from Alaska Housing Finance Corporation (AHFC) discussed the home efficiency rebate program and home electrification and appliance program that are on the way to Alaska. While the AHFC rebate programs are geared towards households that cannot afford to be reimbursed through taxes, there is some opportunity for the rebate programs’ funding to interact with federal tax credits.
The home efficiency rebate program through AHFC is similar to the state home efficiency rebate program that ran from 2008-2018. The incoming rebate program provides homeowners with an energy assessment and rating to identify options for home improvements. After choosing the upgrades they would like to make for their homes, homeowners receive a post energy rating and a rebate for their projects based on their modeled savings from their energy assessment. AHFC is currently working with DOE to make the program as accessible as possible to low to moderate income Alaskans, hopefully making rebates up to 100% of project costs available to lower income households. Participation in the old state home efficiency rebate program does not exclude participation in the upcoming home efficiency rebate program.
The home electrification and appliance program through AHFC provides direct rebates for specific electric and appliance upgrades for existing and new homeowners. Rebates are greater for lower income households to make clean energy projects as accessible as possible to all Alaskans. AHFC hopes these rebates are used to prepare homes for installing clean energy projects and that both rebate programs will be available to Alaskans by the next heating season until funding ends.
Time and time again, the webinar highlighted the myriad of real opportunities that exist for all Alaskans to be a part of the state’s clean energy transition. The new funding provides opportunities for individuals, from low to high income households, and institutions, including non-profits, churches, schools, labor unions, and more, to adopt clean energy projects.
There are also many helpful resources available for individuals and institutions to decide what clean energy investments make the most sense for them. From experts to chat with, to informative webpages, to office hours with the IRS, there are people and resources available to help individuals decide what clean energy investments make the most sense for them. The discussion provided a strong launching point for individuals to realize and gather all the resources available to them as they plan their own clean energy projects.
And Rachel reminded folks that they are “right on time” to be joining conversations about clean energy tax credits, as this past year was the first year individuals and institutions had the opportunity to take advantage of these credits. In addition, Rachel noted that some programs, like elective pay, are new to everyone; she, like the rest of the panelists, looks forward to on-going conversations to make sure individuals feel confident and equipped to their own make clean energy investments.
The discussion also addressed …
With the current bevy of funding opportunities available for clean energy projects, participants closed out the discussion asking about
Wind and solar infrastructure in Kotzebue.
Watch the whole conversation here and then register to attend the next webinar in REAP’s 2024 Fall Energy Speaker Series: “Knowledge is Power: Clean Energy Education for Alaska’s Youth”