Colorado is launching the first phase of a new federal program for climate-controlled buildings

It’s been more than two years since President Biden signed it Inflation Reduction Actlandmark climate legislation that provides $8.8 billion to help residents make their homes more energy efficient and switch to all-electric appliances.

So where exactly is the federal funding?

The main reason for the delay is the lack of state programs to manage the wave of federal resources. Colorado took a big step toward overcoming the hurdle Wednesday by launching a home electrical and appliance rebate program that will offer residents discounts on climate-controlled heat pumps, stoves and dryers starting at some point in 2025.

However, the initial phase of the program will invest $7.6 million in new federal funds into the state’s weatherization assistance program, an existing set of free services to help low-income residents lower their energy bills and better insulate their homes.

“It really made sense to take a two-step approach where most of the funding went to direct rebates to consumers, but to start with the weather customers where we have an existing program and we could get some funding sooner,” said Will Thur. , director of the Colorado Energy Office.

The reconciliation program is a product of the energy crisis of the 1970s. His original goal was to lower energy bills by sealing drafts and adding insulation. In subsequent decades in Colorado expanded the scope of the program install all-electric stoves and heating systems to help low-income households take advantage of renewable energy.

The initial investment represents a small portion of a $70 million grant for the program already awarded to the state by the US Department of Energy. $46 million will go toward compensating low- and moderate-income consumers, scheduled to launch next year. The rest will cover administrative costs and contractor training, Tor said.

These rebates will offer a range of discounts for low- and moderate-income consumers. The program, for example, will provide up to $8,000 to reduce the cost of a cold-climate heat pump that will provide an efficient source of all-electric heating and cooling. A resident could qualify for a discount of up to $840 on electric stoves or clothes dryers.

The exact amount of those rebates is still being finalized and will depend on the buyer’s income and the total cost of the project, said Ari Rosenblum, a spokesman for the Colorado Office of Energy.

In addition to direct rebates to consumers, Colorado received another $70 million for home energy efficiency projects. Thor said the additional funding would go toward multifamily housing and manufactured housing.

Colorado is keeping pace with other states in launching federally funded programs, Thor said. Rebates are only available to customers in seven states, and Colorado is among 18 with federally approved funding applications

Thor said the overall rollout of Colorado’s programs has taken a long time because of a long list of federal goals and regulations. While he believes these fences will help protect consumers and ensure fair access, he acknowledged they have created a complicated process.

“When Congress wrote the law … they didn’t necessarily fully think about how to make it easier for states to administer,” Tour said.

Meanwhile, Colorado residents already have access to other programs aimed at reducing the cost of energy efficiency and home electrification projects. The state offers its own tax benefits for the heat pump and Xcel Energy, Colorado’s largest electric and gas provider, offers a heat pump discounts for their customers.