Nov 16 – A shift toward installing electric heat pumps for the whole house instead of individual rooms is so far paying off with a sharp increase in consumer interest, according to the quasi-government agency that oversees energy efficiency programs.
Efficiency Maine Trust provided more rebates for whole-home heat pumps in three months this summer than in the previous nine months, Executive Director Michael Stoddard said in an Oct. 30 report. The agency issued 1,814 rebates from July through September, compared to 1,805 from October 2023 through June, when the fiscal year ended.
The agency said 563 whole-home heat pump rebates were issued in September, the most in a month since the program transitioned to whole-home heat pump rebates in September 2023. Last year an average of 201 discounts were granted per month; in the first three months of this fiscal year – July, August and September – the monthly average was 604.
Efficiency Maine changed its rebate program in September 2023, increasing the subsidy to make electricity the primary heat source for homes and discourage secondary use of oil or gas, which are fossil fuels that contribute to greenhouse gas emissions.
“At the time there were some concerns about whether customers would find it desirable or whether contractors would keep themselves employed and retain their staff,” Stoddard said. “In the first few months we didn’t know how it would work.”
With another monthly report, Efficiency Maine will have enough information “to see it picking up steam,” he said.
The pumps extract heat from the outside air or from the subsurface and transport it indoors, instead of heating a coil in an oven. They also cool the interior by taking heat from inside and transferring it outside or underground.
The Maine Public Utilities Commission said the heat pump technology is the same, but Efficiency Maine has generally shifted to offering incentives only for whole-building installations, saying it is more cost-effective than heat pumps that supplement other heating systems. According to Efficiency Maine, whole-house installations make the most of heat pumps.
Federal and state incentives of up to $10,600 are available. Efficiency Maine is offering rebates to low-income households – those eligible for home energy assistance, the Supplemental Nutrition Assistance Program, Temporary Assistance for Needy Families or MaineCare – for 80% of the project cost, up to a lifetime rebate limit of $8,000.
Moderate-income homeowners, those with an adjusted gross income of up to $70,000 for an individual tax filer or $100,000 for joint filers, are eligible for 60% of the project cost, up to a lifetime rebate limit of $6,000.
A rebate of 40% of the cost of a project, up to a lifetime limit of $4,000, is available to households of all incomes.
A federal tax credit of up to $2,600 is also available.
Thomas Tutor, residential sales team manager at ReVision Energy, which installs solar panels and electric heat pumps, said the number of heat pump installations increased this year compared to 2023, although he did not have figures on this. Most of the projects are whole-house heat pump installations, he said.
“We’re definitely doing more home heat pump systems,” he said. “The scale of the project has increased as more and more people are encouraged to go after the whole house.”
Tutor warns users to expect their electricity bills to rise. But he said they had to consider the cost of the fuel — natural gas, oil, propane — they used before and are now replacing. “Sometimes people are surprised in the first winter,” he said.
Gov. Janet Mills has prioritized installing heat pumps in Maine to reduce greenhouse gas emissions. Efficiency Maine has spent $119.3 million since 2014, with funding from several sources, including some from the federal government. Millions more dollars are expected from the U.S. Environmental Protection Agency and the Department of Energy. MaineHousing has also benefited from money from Washington to install electric heat pumps.
It is unclear whether future subsidies will be cut after President-elect Donald Trump takes office in January. He has criticized the Biden administration’s policies promoting carbon-free energy as a “green new scam.”
Stoddard said Efficiency Maine has no information on the impact of the election on market demand for heat pumps. The increase in heat pump demand reported by Efficiency Maine reflects activity in July, August and September.
David Friedman, senior director of federal policy at Rewiring America, which promotes electrification, said it would be difficult, if not impossible, for the Trump administration to recover federal money in the pipeline for electric heat pumps. And cutting funding for projects in the coming months “certainly would not be politically popular,” he said, putting pressure on Congress to protect the programs.
U.S. homeowners used $8 billion in tax credits for electrification, energy efficiency and other programs in 2023, Friedman said.
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