Thousands of Michigan residents claimed home energy tax credits

The U.S. Department of the Treasury announced on Aug. 7 that more than 117,000 people in Michigan have claimed over $133 million in home energy credits based on their income tax filings for 2023. Across the country, 3.4 million people claimed $8.4 billion worth of credits under regulations put in place by the 2022 Inflation Reduction Act.

“The law has lowered the cost of clean energy upgrades for more than 3.4 million American families, saving them hundreds, if not thousands, of dollars annually on their utility bills for many years to come,” Treasury Secretary Janet Yellen said in a statement.

The amount that would be claimed in credits had originally been estimated at $2.4 billion by the nonpartisan congressional Joint Committee on Taxation.

The law allows tax filers to claim credits for investing in residential solar electricity in the form of solar battery storage and solar water heating.

Credits have also been granted for home improvements meant to increase energy efficiency. Families invested in electric and natural gas heat pumps, insulation and air sealing to prevent conditioned air from leaking, and heat pump water heaters.

The Inflation Reduction Act is the largest federal investment in clean energy in U.S. history. In addition to tax credits, the law provides incentives for companies to build and utilize renewable energy sources.

When the legislation was being debated in Congress, all of the Republican members of Michigan’s congressional delegation joined the rest of the party in opposing the bill. All of the state’s Democratic representatives and senators voted for the measure, which passed the Senate thanks to a tie-breaking vote by Vice President Kamala Harris.

The Biden administration has set a goal of reducing greenhouse gas emissions by 2030 in the United States by 50-52% of the levels measured in 2005. Greenhouse gases are the largest contributor to global climate change.

In February 2021, the U.S. rejoined the 2015 Paris Agreement, an international framework for cutting emissions. The country had originally joined the agreement in 2016, when former President Barack Obama was in office, but abandoned it in 2020 under former President Donald Trump.Trump has falsely referred to climate change as a hoax created by the Chinese government.