I love being an early adopter of clean energy and clean cars so that when I’m advocating for new policies, I can share from personal experience what is working and what is not. I was fortunate to be able to lease my family’s first electric vehicle (EV) — a Nissan Leaf with an 80-mile range — in January of 2012 thanks to federal and state rebates. A separate public incentive program paid for installing our level-two charger that same year. I was even moved to the point of tears driving my first EV and powering it with 100 percent clean energy from my local power provider, MCE.
So what do all the changes under the Big, Bad, Ugly Bill, signed into law in July, mean for energy efficiency and EV incentives going forward? They are being phased out ahead of schedule, but there are still opportunities for you to enjoy the many advantages of clean power while cutting climate pollution.
- EVs and Chargers: If you are looking to buy an EV at a significantly reduced price, time is of the essence. The $7,500 federal tax credit for new EVs and the $4,000 credit for used ones (if you qualify) will expire on September 30, 2025. Note that the IRS has issued guidance allowing EV purchases to qualify for the credit even if delivery occurs later, provided a binding contract and deposit are secured by that deadline. The EV charger credit, including bidirectional chargers, offers a tax credit of up to 30 percent of hardware and installation costs up to $1,000, and expires June 30, 2026.
I hope to purchase a bidirectional charger for my EV before next June using the federal credit in combination with state and local incentives. This will allow us to use our EV batteries for backup power when there’s an outage and to send power back to the grid when it is most needed. I am so proud of The Climate Center’s collaborative efforts in California to catalyze bidirectional charging with the passage of SB 59, signed into law last year, that could lead to substantial savings on energy bills for Californians. - Solar, Heat Pumps, and Batteries: If you are a homeowner wanting to install solar panels, heat pumps, and/or stationary batteries, you should take advantage of those federal tax credits before the end of this year! The 30 percent residential clean energy (solar) tax credit remains available only for systems placed in service and generating power by December 31, 2025. After that, it ends entirely with no gradual phase-out.
Last year, thanks to this tax credit, my family was able to install a highly efficient and clean, smart hydronic heat pump for heating and hot water. - Energy Efficiency: The Energy Efficient Home Improvement Credit, covering improvements like insulation, windows, and efficient appliances, also ends December 31, 2025.
The IRS recently released a comprehensive FAQ that clarifies deadlines and eligibility. The federal Energy Star website has more information, including tax forms.
If you’ve been thinking about getting an EV, going solar, buying a heat pump, or making other climate-friendly upgrades, act now! You could save thousands of dollars via tax credits while helping to clean up our air and cut climate pollution. You’ll also stop funneling your dollars to the fossil fuel industry through your gas tank and home gas bill.
Speaking of Big Oil, please join me in demanding that state lawmakers stop the billion-dollar giveaways to fossil fuel corporations by taking action here. Thanks, as always, for everything you do to secure a vibrant, climate-safe future for all.
This blog first appeared in The Climate Center’s bi-weekly newsletter. To keep up with the latest climate news and ways to take action for a climate-safe future, subscribe today!
