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Resources

There are several programs that provide financial incentives aimed at reducing up-front costs of energy efficiency, electrification, and renewable energy upgrades. Note that there is an opportunity to combine these programs – see below for what it means to “stack” or “braid” resources to reduce investment costs.

Rebate Programs

Typically rebate programs require the household to make the investment and then apply for money back with proof of purchase. Some contractors will build utility rebates directly into their quotes.

  • Utility Rebates: DTE customers are eligible to receive rebates for energy efficiency upgrades and Energy Star appliances, including home insulation, washers and dryers, dehumidifiers, pool pumps, thermostats, and air purifiers.
  • Home Energy Rebates (a2gov.com): This program offers rebates for qualified energy efficiency and electrification home improvements.

Tax Credits

Tax credits are like discounts on your taxes. Once an improvement is made to a home, the taxpayer may apply for these credits during the tax season.

  • Energy Efficient Home Tax Credit (25C): Improvements related to adding insulation, air sealing, energy efficiency, doors and windows, air-conditioners, and heat pumps made to homes after Jan. 1, 2023 may qualify for a tax credit of up to $3,200. See a simple breakdown of qualifying equipment and credit amounts here.
  • Clean Energy Tax Credit: Investing in renewable energy for your home such as solar, wind, geothermal, fuel cells or battery storage technology, may qualify for a 30% residential clean energy tax credit.

Assistance Programs

These programs provide highly or fully subsidized energy-efficiency improvements to income-eligible households.

  • Weatherization Assistance Program: The Weatherization Assistance Program provides free energy-efficiency improvements to qualified Washtenaw County households earning less than 80% of the Area Median Income. For example: for a single person household, the income limit is $66,300 per year and for a four person household, the limit is $94,650 per year.
  • DTE Energy Efficiency Assistance (EEA): The EEA Program provides free energy-efficiency improvements to qualified households in DTE’s service territory.

Financing

Loan programs tailored specifically to funding energy-efficiency, electrification, and renewable energy upgrades in homes and buildings:

  • Michigan Saves: A statewide program offering financial capital through a network of lenders with favorable terms based on a negotiated contract. Homeowners make the upgrades with the help of authorized contractors and an authorized lending partner.

Other

  • Ann Arbor Solarize: A community bulk-buy solar program aimed at lowering the prices of solar for residents of the city.

Making the Most of These Resources

Stacking or braiding resources means blending different financial incentives or funding sources to maximize resources for a specific goal, like funding home energy upgrades. It’s about using multiple supports together to make a bigger impact to your home.

For example: Consider a resident planning a significant energy-efficiency home improvement project, such as installing insulation, upgrading windows, and investing in a high-efficiency electric HVAC system. The total cost of the project is $10,000.

  1. Federal Tax Credit: The homeowner qualifies for a federal tax credit of 10% of the cost, so they receive a tax credit of $1,000 for this project.
  2. Utility Rebates: Additionally, the utility company offers a rebate program providing $500 for energy-efficient upgrades. The homeowner applies for this rebate and receives the full $500.
  3. Financing: To cover the remaining cost of the project ($8,500 after tax credit and rebate), the homeowner explores financing options. They secure a low-interest home improvement loan with a monthly payment plan.

By stacking the federal tax credit with the utility rebate and financing, the residents effectively reduce their out-of-pocket expenses for the project. In this example, the combined value of the tax credit and rebate reduces the initial cost by $1,500. This, combined with a manageable financing plan, makes the large energy-efficiency home improvement project more financially accessible, and allows them to save more money over the long run.