The end of the year is always a great time to think back and reflect on recent accomplishments. And for those who want to adopt some new resolutions, why not look into reducing one’s environmental impact? Thanks to new technologies and a growing range of options, committing to electrification can help reduce your carbon footprint and build a better future.
Tax breaks for electric cars and recycling will remain in place. However, a few green credits are either expiring or being reduced at the end of 2021.
The Investment Tax Credit is being reduced. This credit dropped from 30% to 26% for new projects that started in 2020 and dropped further to 22% for new construction that began in 2021. The exception is investments in microturbines, geothermal heat pumps, and combined heat and power systems that qualify for a 10% credit until the end of the year.
This 10% credit will expire along with the 22% rate for other projects at the end of 2021. However, homeowners will still qualify for a 10% permanent credit for solar and geothermal projects.
Note that the date on which construction begins determines the rate you qualify for, meaning that you can secure a 22% credit by starting construction before the year ends.
The residential energy-efficient property credit dropped from 30% to 26% for projects installed after January 1st, 2020. There are no changes in 2021, but you have until January 1st, 2023 to take advantage of this rate since it will drop further in 2023. This credit applies to solar electric systems, solar water heaters, fuel cells, small wind turbines and geothermal heat pumps.
Another credit that is expiring in 2021 is the five-year cost recovery period credit. You can still take advantage of this depreciation measure for some renewable energy equipment if construction starts before January 1st, 2022.
The good news is that there are two major projects to extend existing green credits and introduce new credits – the Clean Energy for America Act and the Build Back Better Act, which includes higher credits for EVs.
In 2021, many homeowners took steps to reduce their carbon footprint and adopt electrification in the following areas.
Solar panels are poised to become a $422 billion market globally by 2022. They accounted for 39% of the total electricity generation capacity of the US in 2021. Lower prices and performing technology in this area will continue to drive electrification.
Using electricity for space and water heating is a growing trend. Some municipalities like Berkeley, California are even adopting building codes that ban the installation of natural gas lines for new construction.
Electric heaters and heat pumps that draw energy from the ground or outside air are becoming more commonplace. Over the past five years, heat pump usage has increased by 10% a year on average.
A growing number of households are also opting for instantaneous electric water heaters. These tankless heaters warm water as you use it, which is more efficient than using a tank water heater. With 19% of a household’s energy consumption going toward heating water, installing an instantaneous tankless electric water heater can make a significant difference.
Electric and induction ranges are replacing gas-powered appliances. Electric cooktops can transfer energy more effectively to the food you’re cooking compared to gas ranges. Experts are predicting a CAGR of 4.2% between now and 2027 for the electric stove market as more people opt for cleaner appliances.
Electric clothes dryers are already popular, but the trend to replace old gas dryers with newer electric appliances will continue since electric clothes dryers can qualify for Energy Star rebates.
Recent innovations in battery technology are making battery-operated snow blowers a viable alternative to gas-powered devices. You can also find performing battery-powered leaf blowers to clear your driveway of leaves, debris and light snow.
The automotive sector has been struggling due to component shortages this year, but EV and hybrid sales are encouraging.
While conventional vehicle sales dropped in 2020, the number of consumers purchasing hybrid and all-electric vehicles went up. Electric vehicles had another strong year in 2021 with nearly 62,000 EV sales in California alone during Q2 2021.
Ford is releasing a new lineup with an electric version of its top-selling F-150 truck, and GM could take over the crossover market with the 2022 Chevy Bolt EUV and a redesigned version of the Bolt EV.
Electrification isn’t limited to cars. Ebikes are another popular trend that could become even more commonplace with a proposed 30% tax credit and monthly pre-tax benefit for those who bike to work as part of the Build Back Better Act.
The personal transportation market is seeing a lot of exciting new products, with electric motorcycles, hoverboards, skateboards, unicycles and more. There are more options than ever for those who want to rethink their commute.
Between tax credits, lower prices and more options, electrification is becoming more accessible. Are you ready to embrace this new trend? Qmerit can help you go electric with the installation of a Level-2 charging station to support @home charging for an EV. Plus, Chevrolet will cover the cost of a charging outlet installed by Qmerit if you buy or lease a 2022 Bolt EUV or Bolt EV.
Get in touch with us to learn more about getting an EV charging station installed in your home.