yes we are fantastic good morning everybody what a great turnout we have for this chit chat this morning becoming an inflation reduction act ambassador first and foremost thanks for considering becoming an inflation reduction act Ambassador I am battling a bit of a cold this morning so I've got my bag of cough drops I've got my my handy dandy beverage next to me so hopefully I won't be hacking too much over the next hour but I do have a bit of a frog in my throat and uh we'll power through so um thanks again for being here uh inflation act uh inflation reduction act Ambassador Ambassador that's a big word let's think about that for a second here's some famous ambassadors of course we have a brand ambassadors like Tiger Woods and Nike he's got a hundred million dollar deal with Nike Shirley Temple you may or may not know in 1989 became the very first U.S ambassador to Czechoslovakia Angelina Jolie United Nations Goodwill Ambassador for refugees and so you know I was just thinking there's just a ton of similarities between these ambassadors and being an IRA Ambassador I mean these folks they travel the world see all sorts of different things Ira Ambassador you get to travel you know Lake County Anoka County you know Stearns County uh Tiger Woods he gets a hundred million dollars um and as an IRA Ambassador you will receive our heartfelt gratitude you know it's kind of the same really really a lot of similarities lots of similarities there okay Ira Ambassador well what in the world does that even mean in the first place first of all here at the good old clean energy resource teams we have received a ton of requests to spread the word about the IRA which is fantastic and we have given lots of presentations uh over the last few months all across the state um but we in no way shape or form can reach everybody everywhere and so we need your help we need your help in getting the word out and we thought gosh if we created this toolkit and this ambassador program then we can get the tools and folks and so that you can get the word out to folks in your community and so what we've done is uh created um uh recorded presentations both longer recorded presentations as well as really short maybe two minutes to five minutes six minutes um uh recorded presentations that that ambassadors can use we have Scripts on the various different items of the IRA handouts slide Decks that you can modify for your purposes uh and um and when you sign up to access the toolkit then you'll also have an option to receive email updates so the IRA passed in August 2022 but there are uh guidance being issued regularly or updates to the IRA being issued regularly so you'll be the first to know about all these various things through our email updates and one thing I'll I'll note is please let us know if you use these resources it's really important for us to keep track of if you do a presentation to your a local community group or use the handouts at a tabling event whatever it might be we would really appreciate it if you let us know and let us know how we can improve it of course as well it's pretty easy to find of course as a follow-up to this presentation we'll send direct links uh to where you can sign up to be an IRA Ambassador but if you go to the search home page the first thing that you'll see is a link to our inflation reduction act guidance and on that page then you'll see this uh button on the lower left there inflation reduction act Ambassador toolkit and you can click on that and you're off and running and I'll Circle back to this slide at the end of the presentation just as a a reminder to folks with that these are the the topics that I'm going to cover in the next 45 minutes or so 15 minutes I'm going to give a broad overview of what the IRA is all about and then dive into some of the residential aspects uh Energy Efficiency aspects EVS uh businesses and non-profit efficiency and renewable benefits as well as this brand new thing called direct pay or sometimes called elective paid and talk for a minute about what this new thing is all about it's very exciting before I launch into that uh I suspect many of you are familiar with the certs or the clean energy resource teams but just a friendly reminder that this is our 20th year two decades we've we've been around we're out of our teenage years and we're we're we're young adults now uh um and we uh all throughout all these years we've really had the straightforward mission to help communities do clean energy projects we're really project focused and and um and so we have uh four Partners we're a partnership organization Southwest Regional development Commission uh the Great Plains Institute non-profit here in the Twin Cities and then of course the state of Minnesota is a partner of ours we work hand in hand with the Department of Commerce and then our fourth and final partner is the University of Minnesota yes particularly the U of M extension that search all right let's dive into the the topic du jour the inflation reduction act and I'll say you know it's it's uh gosh it's now going on almost a year since it was passed um but there and there's been a ton of guidance issued uh since it was passed in August 2022 but they're still uh some things that we we don't quite know yet um and it's a humongous bill you know 700 Pages uh dealing with a wide variety of things and and so there may be things that I don't know there may be things that we collectively don't know quite yet at the heart of the inflation reduction Act is a 369 billion dollar package of Investments this is the most significant legislation in history and it's not even close to advance the the clean energy transition 110 billion of that will be in Grants and these are both formula grants to states and cities as well as uh competitive grants but really the engine of the IRA is tax credits who doesn't different tax Provisions with the aim of accelerating the deployment of clean energy clean vehicles clean buildings clean Manufacturing and call me biased but you know I think those grants and tax credits should come to Minnesota I know that's a real controversial statement to say to this group I'm sure but that's in part why we again why we want this ambassador program is just to get the word out to as many people as possible about these different incentives many of the the tax provisions offer bonus credits to projects that are located in low income communities or what are called Energy communities that pay prevailing wages and use apprenticeships or meet certain domestic content provisions get this the American clean energy Association projects that the IRA itself will result in in the deployment of 550 gigawatts gigawatts of clean energy generation in the next decade that's 550 gigawatts that'll come from solar wind geothermal combined heat and power fuel cells and and more let's dive in on some of these residential focused opportunities and talk about tax credits or homeowners so who is eligible anybody anybody with a tax appetite uh there has been a a tax credit incentive for Energy Efficiency on the books for quite a while but it was capped at five hundred dollars and it was capped at five hundred dollars for your lifetime now thanks to the IRA the tax credit is up to 30 percent and uh and the cap there's still a cap but it's three thousand two hundred dollars and it changed from Once in an eternity to an annual cap three thousand two hundred dollar annual cap by the way I should note if you have any questions uh throughout this presentation please put them in the chat and we'll we'll take a crack at them um as they come up uh this breaks down to a total limit of twelve hundred dollars for any combination of any uh home envelope improvements so think Windows Doors skylights that sort of thing insulation electrical work okay um any combination of heat pumps or heat pump water heaters and biomass stoves lots of biomass stoves in Minnesota that's subject to a two thousand dollar annual cap so talking about air source heat pumps just as an example I think this is the decade of the air source heat pump I really do you you folks likely know of what they're all about and transferring heat instead of creating it Heating in the winter Cooling in the summer 30 percent 30 percent covered of the project cost up to two thousand dollars for that tax credit and really just backing up a second I think the IRA itself is really about electrification it's really about a drive towards electrification a shift away from fossil fuels how to get more efficient Heating and Heating and Cooling and uh and drive your home your business towards electrification not all air source heat bumps are created equal and it's important to check really for all a lot of these different Technologies um it's important to check what qualifies as a good rule of thumb uh all ducted heat pumps that have a energy star label they're good to go but always do your due diligence before you sign on the dotted line to purchase that item to make sure that it qualifies residential rebate programs created through the IRA there's two big ones um and these this will be funding that comes from the feds to the state energy offices State energy offices have to put together detailed plans of all the rebates will be rolled out the feds have to approve those plans and then states have up to nine months to implement the plans the IRA allocated about 9 million excuse me 9 billion for two new residential Energy Efficiency programs the home energy Performance Based whole house rebate program that's a bit of a mouthful so they call it the homes rebate and the high efficiency electrical home rebate program both created Brand New by the IRA for the homes rebate uh everyone qualifies however there's uh significant more money for low and medium income households and uh Hira on the high efficiency electrical home rebate program is really designed for for LMI residents low medium income residents a little bit more on the homes rebate what's that all about so uh so I just talked to the person who's rolling this out for Minnesota the other day and she said that we can expect this to become a reality in 2024 um and this is a whole house energy Improvement whole house energy Improvement so uh number one we always encourage folks to to get an energy audit on their home or on their business and there's a uh in an incentive through the IRA to do that um so you got that home energy audit you know what to do the the rebates through the homes program will be based on modeled and modeled or measured Energy savings so if it's modeled that means you're working with a contractor who uses a modeling software that says if you do a b and c you'll save 20 on uh on your energy bill that's a two thousand dollar rebate if you save 35 percent Energy savings that's a four thousand dollar rebate so that's the modeled approach or it could be measured so you know what to do you do the you work with the contractor who measures your energy use beforehand before the work is done and then measures it after the work is done and if there's a 20 Energy savings you get a couple Grand rebate if it's 35 or more four thousand dollar rebate and if uh and these rebates are doubled if you are a low and moderate income resident so the state I know state of Minnesota are states all across the nation are thinking art about things like income verification and what software can be used um and just other uh various uh quality assurance components Kira also starting next year is a little bit different this is for homeowners and apartment dwellers again coming through the state this is a this is intended to be a point of sale rebate so you go down to Home Depot you purchase that that uh heat pump clothes dryer you get the rebate when you walk out of the store when you purchase the item um so so that's a benefit uh this covers both the um the equipment and installation costs these what you're seeing on the screen here are the max amounts um so this is up to fourteen thousand dollars uh is the is the grand total um if your household income is is 80 percent uh area median income again this program is specific for LMI so if it's if your income is eighty eighty percent of that LMI of or excuse me 80 percent of the area median income or less 100 rebates 100 if it is between 80 percent up to a hundred and fifty percent of the area median income for that 50 percent uh of of the rebate and if your income is over 150 percent that's where the tax credits come in so if you're if you got a house like mine and you've got a service panel that looks sort of like a a Rube Goldberg machine with wires coming in and out all over the place that's four grand if you if you qualify um with your income four grand to make those improvements pretty nice so here's just a summary of uh of this of this program really again targeting LMI households you see those numbers again 80 percent or less 100 of the rebate up to 150 percent 50 percent remade and uh and then and then if it's above that of course you can use the tax credits and renters can of course tap into this too on on items that may that they may purchase for their or their home so as I mentioned these are still in the works to be rolled out sometime next year but we're really encouraging folks to begin planning now um and I'll say that there's a a website called rewire America that really has uh uh some nice electrification planning resources and a great guide on on how to plan for these projects and of course get that home energy on it and that's really the the first and foremost thing that you can you can do today let's talk residential and solar you know there's been a tax credit for solar uh for homeowners and business businesses for quite a while it was last year it was 26 percent um it was on its way down to 22 percent eventually it was gonna hit 10 percent until the IRA so now so now that uh tax credit has been boosted back up to 30 percent and this qualifies for not only solar projects but also stand-alone energy storage used to be that I'm talking batteries here it used to be I bet that battery had to be tied into a solar array that's no longer the case it can be a standalone energy storage item and take advantage of that tax credit talking about EVS EV incentives are shifting again that there's been a tax credit for Ev vehicles on the books for a while 7 500 tax credit that That Remains the Same 7500 tax credit what's changed is there's no longer a vehicle cap it used to be if the manufacturer made over 200 000 vehicles uh that tax credit went away so like Tesla um uh but now those so that went that uh that 200 000 Vehicles cap went away and so those vehicles are eligible again uh what's new is there's some income requirements and cost of the vehicle requirements so the maximum income for a family household three hundred thousand dollars uh a taxpayer filing single hundred and fifty thousand dollars and then that uh the cap on the cost for the vehicles themselves for a car fifty five thousand uh and then for a van or an SUV pickup truck that goes up to eighty thousand dollars there's some helpful websites out there that show which vehicles qualify for these tax credits one new addition thanks to the inflation reduction Act is that used EVS will now also also be eligible for a tax credit a four thousand dollar tax credit or 30 percent of the sale price whichever is lower so that's exciting so again here's just a a summary of of some of those income limits and and some of the conditions now starting next year 2024 at least 40 percent of the materials used for your new EVS battery must come from the United States or one of our our trade allies um in this and this goes up uh year after year up to 20 20 29 it uh it goes up to 100 40 next year 100 percent by the end of this of uh the decade otherwise you will not be able to take advantage of the tax credit um in addition if your EV battery uses materials from a country that the U.S deems a state sponsor of Terror or is blocked by the treasury Department's office of foreign assets control you also won't be eligible and who's on that list China and China right now makes a whole heck of a lot of of EV batteries so again as you heard me say from the outset this is the inflation reduction Act is a a big Market incentive for creating these these products um in America or with one of our trade allies thank you let's go through a case study the Coleman family lovely family they live in northern Minnesota in Babbitt 1300 square foot three bedroom home built in the mid 1960s and uh they have an annual income of 55 000.
it's under 80 percent of the area median income for Babbitt which is ninety three thousand dollars so they uh through Hira um they qualify for an upfront discounts that can cover a hundred percent of their electrification cost up to 14 Grand again that's the cap so what might this mean for the colons um this year they want to ditch that old propane range and and uh buy a new Range uh 100 covered just like my house they've got some old wiring that needs to be improved and uh 1500 bucks again 100 all the way down to a few years from now they they want to ditch their gas car and buy a used Nissan Leaf and uh fourteen thousand dollars they can get a four thousand dollar tax credit on the new on the used Eevee that's the Coleman's this is the Garcias they kind of look like the colemans don't they and they are a lovely family of five down in Worthington sixteen hundred square foot four bedroom home built in the 19 early 1970s heated with natural gas and their income is a hundred and fifteen thousand it's just a shade under the uh that 150 percent Ami or Worthington which is um 83 000 I believe and so they qualify for 50 percent 50 through the uh Ira rebates the Hera rebates so this for this family this year they want to get a new a new used uh electric vehicle get rid of their gas car again they get a four thousand dollar tax credit for that uh they've got an old service panel that they want to make some changes to half of that covered through herea all the way down to 2028 they're thinking about putting in a solar array on their home and uh they can get a 30 percent tax credit for that array so the important thing here is it's just just thinking ahead planning um what items do you have that are coming to the end of their useful life or for whatever reason you wish to make some improvements and and just thinking through about what those rebates and incentives may be all right businesses and Farms some good good improvements here for the solar um as I mentioned before that tax credit was was on its way down 26 that then 22 percent heading south towards 10 percent foreign that's been bumped up for for at least the next decade to a minimum of 30 percent and uh so if that solar project is over a megawatt the tax credit is only six percent unless you use prevailing wage which of course you should in apprenticeship requirements and then it is bumped up to the full 30 percent tax credit for the longest time these really all of the renewable energy projects Across the Nation have been getting tax credits either through What's called the investment tax credit or a production tax credit the PTC the ITC or the PC PTC production tax credit is one that you get um staggered over time ITC you kind of get it get it uh in that first year uh after you do the project and those are going away both of them both of them are toast on January 1st 2025 and they're being replaced by What's called the clean electricity investment credit this is a technology neutral incentive it applies to all generation facilities and energy storage systems that have a greenhouse gas emission rate of zero so like solar or wind or geothermal or hydrogen fuel cells or combined heat and Power biogas and and more so that is that'll roll out January 1st 2025.
again the the this new tax credit is it'll be functionally similar to the uh the long-standing investment tax credit but not technology specific but also this is really exciting I think through the IRA is that these tax credits are now transferable AKA you can sell them so beforehand if you didn't have a tax appetite and you had the tax tax credit in hand you couldn't you couldn't use it and they were non-refundable so if you didn't have it if you didn't have a use for them um you just couldn't use them now you can sell them on the open market if you don't want to use them yourself eligible entities can can put them out on the open market and sell them and by the way that income that you make from that sale is non-taxable so that's a pretty sweet incentive for a business that doesn't want to use the tax credit themselves or or can't use the tax credit so maybe you sell them for maybe a business sells a tax credit for 90 cents on the on the dollar for example that that organization that buys it they they can use the full one dollar tax credit they buy it for 90 cents and then that Delta is their savings and the person that sells it has that 90 cents to to invest in whatever they want to invest in that's brand new so I mentioned the uh the tax credit is 30 as an at a minimum it couldn't be much more than that which is really exciting through the the inflation reduction Act they put in place what are called adders uh four different headers and uh or commercial projects or as as I'll talk about in in a minute for um for non-profits as well non-tax paying entities so if uh your if you are using um we'll say solar if you're using solar modules solar components that are made in America domestic content that 30 tax credit goes to forty percent I said ten percent Adder if you are located in an energy community and that's defined as a community what that has high fossil fuel employment um uh or uh has um or like a recently shut down coal plant um or or the project is located on a Brownfield site that's an additional 10 percent two other adders if the project is located in a uh under five megawatts and it's located uh in a low-income Community you may qualify for an additional 10 adder or if it's part of an affordable housing project or benefits low-income residents it could be an additional 20 so so the the takeaway here is the these tax credits they were on their way down to 10 percent now if the stars all aligned that tax credit could be as high as 70 in an ideal situation I mean it's a game changer total total game changer uh storage again I I mentioned that Standalone storage qualifies for for these tax credits as well and they qualify for the the adders as well um by the way I was uh um and so I mentioned a lot of uh production is Shifting to Made in America um over the July 4th holiday weekend I was talking to mayor of a small town in Kansas and they have a Panasonic four billion dollar battery manufacturing plant moving close to their Town their to their town of 5 000 people um in Kansas so that's that's getting up and rolling there's another four billion dollar plant uh created by Honda and LG in Ohio that's being built and more so where are even though the IRA was just passed um August of last year where we are really seeing corporations um make incentive uh or investment and decisions uh right here in America reap gosh I used to love to talk about reap the rural energy for America program because re-provides provided up to a 25 grant for Farmers or for um for businesses in in Rural America uh up to 25 competitive Grant that's changed and it's changed for the better at that 25 grant now has gone up to 50 and the FEDS dumped in a bunch more money two billion dollars total so it's still a competitive grant program there's no guarantee that that farmers that put a solar array on their land or a small business in Rural America rural Minnesota uh uh we'll get this grant but um it uh it's it's a very very healthy incentive that um that we have been getting the word out and we'll continue to get the word out by the way Rural America is qualified as a population centers of 50 000 or less so much of Minnesota qualifies another one that's really a game changer um in the tax code it's called 179 D not the most uh wildly memorable name 179 D but it's it's the Green Building tax deduction not a credit not a rebate it's a tax deduction and again like some of these other ones it's been on the books for a while since 2006.
And the whole idea here is to provide an incentive to drive commercial building owners and designers of of buildings to reduce their energy use by rewarding the implementation of energy efficient building components like the HVAC system or lighting or the building envelope those sorts of things prior to the inflation reduction Act the the the uh commercial building owner could get a tax deduction of a buck 88. 88 per square foot if the renovation or the new building achieved a 50 Energy savings 50 that's a that's a big a big bar a high bar to reach or the new construction was 50 more energy efficient over a standard energy Benchmark the inflation reduction act lowered the required Energy savings from 50 percent to 25 percent and set a sliding scale for the amount of the adduct of the the deduction um from 50 excuse me 50 cents uh and per square foot um up to a dollar that's that's what they call the the base deduction um but if but again if you pay prevailing wages or use apprenticeships in your building renovation or your brand new building here's the big deal that tax deduction goes can go up to five dollars per square foot per square foot and this used to be only for commercial entities the IRA changed that they said um that now non-tax-paying entities can can tap into this as well and I know you're scratching your heads like how can a non-tax paying entity take a tax deduction they don't pay taxes but what they can do is they can allocate that tax deduction to the engineer or the architect or the building contractor whoever they're working with that a for-profit entity that they're working with and it's it's part of the negotiation uh uh for the price of that project this that non-tax paying entity says hey I'm going to get a on this hundreds of hundred thousand square foot building I'm gonna get a a tax deduction of five hundred thousand dollars so I'm gonna allocate that to you building contractor and so why don't you reduce the price of this project by x amount it's really again a negotiating point let's talk about direct pay um direct pay this brand new thing in all these tax credits so wonderful except if you're a non-tax paying entity if you were a city county school Food Shelf the Red Cross whatever it may be a non-tax paying entity you could not take advantage of that tax credit and so the inflation reduction act recognizes this and implements what they call direct pay this is these uh will be for renewable energy projects as well as for electric vehicles so you can receive up to again 30 percent minimum a direct payment from Uncle Sam for these projects uh or 30 up uh of the cost of the of the qualifying vehicle so if it's a vehicle uh there's a limit of seven thousand five hundred dollars um for your uh for like for your typical sedan uh in a forty thousand dollar limit for vehicles up above that weight so like uh a bucket truck or a fire engine or um something of bad nature uh so again for the for the um for a renewable energy project you want to put a solar on a solar array on your city hall uh you can tap into the it's a way for for non-tax paying entities to tap into tax credits like like the investment tax credit thirty percent minimum investment tax credit IRA and the bipartisan infrastructure law affectionately known as Uncle IRA and Uncle Bill uh and some folks add in the the chips act um uh that encourages domestic production of of uh electronic chips so Uncle Ira Uncle Bill Uncle chip these are all brand new things and in the last few years and they all work together uh bipartisan infrastructure law passed in November 2021 1.2 trillion trillion trillion dollars for highways and bridges and Port Investments and wastewater treatment plants and building out broadband but also 7.5 billion to build out a national network of EV uh charging sites and 73 billion dollars in power infrastructure and and clean energy transmission so you can't really have one without the other as we head towards the the tail end here thanks for hanging in there I I think these are some of the key takeaways first of all again a lot of these Investments targeted towards are low and moderate income residents uh that investment tax credit um set at 30 percent for a decade and there's really predictable that that is predictable it used to be what was called the solar roller coaster or the solar coaster where that tax credit was 30 then going down then Congress would bump it back up and and now it's thirty percent or at least a decade that Standalone batteries um how they can tap into the tax credit is a big deal that reap incentive 50 holy moly for Farmers for small medium-sized businesses in in rural Minnesota what a great advantage that is a great incentive that is the fact that you can sell these tax credits and then these uh then the implementation of direct pay or elective pay for non-tax paying entities all of these I think are game changers these are some resources I found to be particularly helpful as I've dived into the inflation reduction Act of course I point people directly towards the last one on the list there how could I not in a clean energy resource teams we have we have a ton of great information we break it out by Resident business and try to make it as as digestible as it possibly can be so encourage folks to go there as well as other great sites I mentioned the rewiring America is really helpful and and the department and the feds and they have they have good information uh online as well last but not least why we're here today again um thank you very much for considering becoming an IRA Ambassador and and helping get the word out I know we've already had something like 50 50 to 60 people 50 to 60 different groups I download our materials and are using our materials are ready and that's fantastic but boy let's double that let's triple that and again you can tap into those recorded presentations and make it easy for you with some scripts and handouts and slide decks and and then uh and then sign up for our email updates as well that's me contact me if you have any questions about this and I know we have Shaylin and Maggie on the line as well yeah we're all here to help if you have any questions about the ambassador program or the IRA or anything in between um just give me a holler or shoot shoot us an email and and we've got that handy dandy short um a website listed there that'll that'll bring you right to where you need to go Maggie yeah go ahead yeah hi everyone I'm Shaylin I'm the communications manager for certs um and you have all asked some really fantastic questions in the chat and I've been trying to um share links and and share resources and honestly all of the links that answer your questions um I've been pulling them directly from our guide to the inflation reduction act which you can get from that little short link on the screen but there are a couple questions Pete do you mind if I if I um I catch you on the spot go for it there's a couple that I I wasn't quite sure about so um one person asked is the transferability of tax credits only available for commercial projects or is it also available for homeowners that want to go solar that do not have a tax liability not a hundred percent but I think it's I'd say I'm 95 confident that it's just for commercial um and then the 179 d is that only about Energy Efficiency or does it also reward all electric slash zero carbon emissions um efficiency okay last question you're doing great Pete um it's a reap follow-up question so um the I know that it's it's a competition but this person asked so the federal amounts are first come first served by the states yeah if that person is still on um feel free to clarify too like I I has that person maybe taking themselves off mute um yeah I think I if I understand correctly I think each state is given an allocation okay Joe are you still here Joe i s I see you are muted there you are I'm unmuted now um what's the question again you had asked a follow-up question about reap and you had said so the federal amounts are first come first served by the states right uh each each state uh um so I think I had I had answered incorrectly I had said by applicant but Pete bucket right Pete you said there's an allocation to each state I think I think that I I think each state gets an uh an allocation um and then people apply uh sort of like that sort of like the navi program nevi um that's by state in other words for charging stations and things like that I think that's my state population States get uh uh different amount Joe I will follow up with you um take your email from the registration and I'll um reach out to to a few folks and get you some specifics I would love to be your best Ambassador in Wisconsin that's where I'm at harassing borders I love it thanks Joe sure uh we have three minutes left does anyone else have any any question will be sent to follow up to everyone um with links to all of this and the recording we really appreciate you all joining us today this is great and a huge shout out to Shaylin as you can tell by the chat answers Shaylin is a big part of the the brains behind the operation it's both Pete and Shaylin tag teaming this so we are so appreciative to have both of them thanks Maggie it's mostly Pete though [Laughter] I was gonna say it's mainly Shaylin well there's no other questions you guys all get the gift of two minutes time so thanks again for joining us and if you have any questions don't ever hesitate to reach out we we respond to every email we get and we really love hearing the questions you have it helps us um do our work a little bit better so info at clean energyresourceteams.org you know here's something back thanks so much everyone bye