Overview of Inflation Reduction Act Fund Distributions

The federal Inflation Reduction Act (IRA) was signed into law on August 16, 2022. According to the Committee for a Responsible Federal Budget (CRFB), the IRA includes new spending and tax breaks totaling $499.0 billion from 2022 to 2031. At the same time, the IRA is estimated to increase savings and revenues by $738.0 billion.
Of the spending and tax breaks, it is estimated by the CRFB that $391.0 billion is attributable to energy and climate issues while $108.0 billion is attributable to health care. Considering the scope of the IRA, this article will focus specifically on funds that will be made available through the U.S. Department of Energy (DOE).

DOE Spending and Tax Breaks

According to the IRA Guidebook produced by the Office of the President, total spending and tax breaks that fall under the DOE total $35.3 billion. Nineteen different programs within the DOE are affected by the IRA. Of those different program areas, the largest total spending and tax breaks are found in the Advanced Industrial Facilities Deployment Program ($5.8 billion), Energy Infrastructure Reinvestment Financing ($5.0 billion), the High-efficiency Electric Home Rebate Program ($4.5 billion), and Home Energy Performance-based and Whole-house Rebates ($4.3 billion).

Advanced Industrial Facilities Deployment Program

According to the IRA Guidebook, this is a new program that is designed to carry out projects for the:

• Purchase and installation or implementation of advanced industrial technologies at eligible facilities;
• Retrofits, upgrades, or operational improvements at eligible facilities to install or implement advanced industrial technologies; or
• Engineering studies and other work needed to prepare eligible facilities for activities described in the first two bullets.

The Advanced Industrial Facilities Deployment Program will be made available through grants, rebates, and cooperative agreements to owners or operators of domestic, non-federal, non-power industrial or manufacturing facilities engaged in energy-intensive industrial processes. This grant opportunity is currently listed on grants.gov and has an application closing date of February 29, 2024. It can be searched for on the website by using the catalog of federal domestic assistance number (CFDA) 81.255.

Energy Infrastructure Reinvestment Financing

According to the IRA Guidebook, this is a new program that is designed to carry out projects that retool, repower, repurpose, or replace energy infrastructure that has ceased operation, or enable operating energy infrastructure to avoid, reduce, utilize, or sequester air pollutants or anthropogenic emissions of greenhouse gases.

Funding for Energy Infrastructure Reinvestment Financing will be made available through direct loans and guaranteed/insured loans. CFDA number 81.126 has been designated for this listing, but it is not currently listed on the grants.gov website. Those eligible for these loans include general governments and non-government, for-profit entities, and nonprofit organizations.

High-efficiency Electric Home Rebate Program

According to the IRA Guidebook, this is a new program that will allow state energy offices and tribal nations to develop and implement a high-efficiency electric home rebate program. State energy offices and tribal nations may use up to 20.0 percent of any awarded grant amount for planning, administration, or technical assistance needed to establish their respective home rebate programs. The remaining amount must be used for rebates for purchases of high-efficiency electric home appliances.

Home Energy Performance-based and Whole-house Rebates

According to the IRA Guidebook, this is a new program that will allow state energy offices to develop a whole-house energy saving retrofit program that will provide rebates to homeowners for whole-house energy saving retrofits. As with the High-efficiency Electric Home Rebate Program, state energy offices may use up to 20.0 percent of any grant award for planning, administration, or technical assistance associated with the rebate program. The remaining amount must be used for eligible equipment that significantly reduces energy consumption in a home or multi-family building.

Home Rebate Programs in Kansas

According to the Kansas Corporation Commission (KCC), DOE has established rolling applications for the High-efficiency Electric Home Rebate Program and the Home Energy Performance-based and Whole-house Rebates that will close on January 31, 2025. KCC will apply for the federal grants, and the agency estimates it will do so in calendar year 2024. If awarded, the KCC estimates contracting with a third-party vendor to help administer the program and the funds.