Survey Finds More Than Half of US Homeowners Cite IRA for Energy Efficiency Upgrades

SUWANEE, Ga. — More than half of U.S. homeowners cited tax credits or rebates stemming from the Inflation Reduction Act as one of the primary reasons they would consider energy efficiency upgrades like the installation of a heat pump, a recent survey found.

The survey was conducted by Mitsubishi Electric Trane HVAC US, which specializes in heating, ventilation and air conditioning units, and was intended to explore homeowners’ attitudes toward the IRA and sustainable home upgrades, especially in regard to heat pumps.

A heat pump is an air transfer system that can move heat from the cool outdoors in the fall and winter to warm a home, and move warm indoor air outdoors to keep homes cool during the summer months.

Because heat pumps transfer rather than generate hot or cold, they are more energy efficient than other ways of heating or cooling a home.

The Mitsubishi survey found that 63% of U.S. homeowners had heard of the Inflation Reduction Act, and that 54% ranked government incentives (such as tax credits or rebates) as one of their top three reasons for considering installing a heat pump.

The other top reasons were to “reduce energy bills” and “improve the air quality in my home,” the survey found.

The survey also found that 83% of respondents were concerned about the impact of energy bills on their household budget.

Roughly 46% of respondents said the cost to cool their home last summer rose “somewhat” or “much more” than the summer before.

Fifty-four percent said it cost “somewhat more” or “much more” to heat their home this winter, compared to last winter.

Similarly, 49% ranked “reduce energy bills” as one of their top three reasons to consider installing a heat pump.

According to the survey, 24% of respondents stated their home is already equipped with a heat pump and 69% would consider installing a heat pump in their home. 

Additionally, 28% of homeowners said a concern preventing them from considering a heat pump in their home was the installation cost.

The IRA’s Energy Efficient Home Improvement Credit (section 25C) offers a nonrefundable tax credit of 30% of the qualified expenses to install a qualified heat pump that is placed in service on or after Jan. 1, 2023, and before Jan. 1, 2033, up to $2,000 per year.

“The financial incentives offered through the IRA are anticipated to accelerate the adoption of energy-saving, all-climate heat pumps,” said Mark Kuntz, chief executive officer, Mitsubishi Electric Trane HVAC US. 

“Our mission is to educate homeowners about the many benefits of all-climate heat pumps versus conventional heating and cooling systems,” he said.

The survey also found more homeowners would be interested in tax credits for installing a heat pump or high-efficiency electric heating, ventilation air conditioning, and/or water heating, than interested in installing solar panels or purchasing a new or used electric vehicle. 

This benefit is even more appealing for millennials (born between 1980 and 1993) as 65% cited, among other listed options under the IRA, that tax credits for installing high-efficiency electric heating, ventilation, air conditioning and/or water heating would be of interest to them. 

The survey included the responses of more than 1,000 U.S. homeowners aged 18 and up, from all regions and genders. The margin of error for this index is +/- 3.114%.

Dan can be reached at [email protected] and @DanMcCue