United States

New Yorkers Will Now Get Incentives For Upgrading Their Homes, But There's A Catch!

New York homeowners can now receive up to $14,000 for climate-friendly upgrades, including insulation and heat pumps, thanks to new funding from President Joe Biden's Inflation Reduction Act.

Representative image Photo: Pinterest

Climate change is the most important issue in present time. Various steps are taken around the globe by governments and locals to tackle this and save environment. One such step is taken by New York, where homeowners will now be eligible to receive incentives for their climate-friendly efforts.

Low- and middle-income homeowners in New York can receive up to $14,000 for climate-friendly upgrades, including insulation and heat pumps, through new funding from President Joe Biden’s Inflation Reduction Act. Governor Kathy Hochul and U.S. Energy Secretary Jennifer Granholm announced this initiative on Thursday, focusing on its role in accelerating electrification to meet city and state climate goals that aim to eliminate fossil fuel use.

The rebate strategy, part of the Justice40 initiative, aims to allocate 40% of federal climate funding to disadvantaged communities, covering a significant portion of costs for low- to middle-income families. Nationwide, switching to heat pumps is projected to save up to $1 billion annually in energy costs, translating to nearly $200 per month for an average household, according to Granholm.

“These programs are targeting largely low- and moderate-income homeowners, which are the ones who need it most obviously, because their houses often are the leakiest, and have the oldest and most inefficient appliances,” Granholm said in an interview with Gothamist.

Eligible homeowners can receive the incentives in form of rebates, allowing residents to receive the full amount they’re eligible for. They can, therefore, get of up to $8,000 for a heat pump, $4,000 for an electrical panel, and $500 for wiring. New York is the first state to implement this $300 million program.

Cost is the biggest barrier to residential electrification modifications like heat pumps, according to the Urban Green Council. The council estimated that central heat pump systems for one New York City apartment ranged from $15,000 to $22,000, with a caveat that it could come out to 15% more with added features such as simultaneous heating and cooling.

The program will be rolled out in two phases. The first phase, already underway, targets low-to-middle-income households earning 80% of the area's median income or less. In Queens, this threshold is approximately $124,000 for a family of four, according to the Department of Energy.

The second phase, administered later this year by the state’s Energy Research and Development Authority through the Empower+ program, will allocate half of its funds to low-to-middle-income families and the other half to all households. An additional $8,000 in rebates will be available for upgrades that reduce energy usage by at least 20%.

“There are as many as 48 million single-family homes that need to be upgraded across America. It’s a huge lift,” Granholm noted. “This is an important step, but it won't cover everybody. Nonetheless, we want people who are vulnerable to know that this help is there for them.”