As designed in the legislation, the efficiency rebates are quite broad and can cover a range of homes.

• Both multifamily and single-family homes are eligible

• Owners and units with residents of all income levels can qualify, although higher rebate amounts are provided for low-income homes (<80% of area median income)

• Only retrofits of existing homes or units are eligible

However, the details and timing of how the efficiency rebates roll out are highly dependent on how states design their programs. A state could choose to allocate all of their funding to multifamily or to low-income single-family homes.

Because the efficiency rebates are dependent on modeled or actual energy savings, just about any energy efficiency improvement to a home might qualify, although since significant (>15%) energy savings are required in order to claim the rebates, most projects will likely focus on weatherization and building envelope improvements and improving the efficiency of large systems in the home like space heating and cooling and water heating.

The efficiency rebates can be claimed along with tax credits for the same project, although you should consult with your personal tax advisor for details. The efficiency rebates cannot be combined with the electrification rebates (or any other federal grant or rebate) for the same upgrade (e.g. a heat pump), but the two programs can be combined for different upgrades within the same home (e.g. heat pump and weatherization).

Measured savings and modeled savings programs involve specific criteria that must be met. We recommend working with a knowledgeable, participating contractor if you are seeking to claim an efficiency rebate. 

For states that allow a modeled energy savings approach, the energy modeling software used must be consistent with the BPI-2400 standard to estimate energy savings before the upgrades and provide rebates for homes predicted to achieve a minimum of 20% energy savings.

For states that allow a measured energy savings approach, the method used to measure home energy savings post-installation must be approved by the Department of Energy. The method for collecting and verifying energy use for the measured savings track is still being determined. This will probably involve comparing utility bills before and after the upgrades.

For all homes, an energy audit will be required to produce an accurate baseline of energy use for the home.

The efficiency rebates should generally be implemented as upfront discounts applied on the contractor invoice for the efficiency upgrades. The contractor (or a third-party “aggregator”) should be reimbursed by the state after modeled or measured energy savings are verified. An aggregator is a company or nonprofit organization that assumes the administrative responsibility for processing the efficiency rebate — so contractors can focus on the installation. 

All the details of how reimbursement will work — and who will be approved to complete eligible projects — will be determined by officials in your state.