Donald Trump’s election may bring changes to HVAC-related tax credits and incentives established by the Inflation Reduction Act (IRA), which allocated significant funds for energy efficiency and climate initiatives. The IRA, passed in 2022, includes up to 30% tax credits for efficient HVAC systems and substantial rebates for low- to moderate-income homeowners installing high-efficiency heat pumps. While Trump has expressed intentions to rescind unspent IRA funds, any reversal may be challenging. Many states have already secured or are in the process of securing funds, making it difficult to retract these obligations.

Though a complete repeal of the IRA would require congressional action—potentially difficult given prior GOP resistance—Trump’s administration could still shift tax policies to favor fossil fuels. This would likely slow but not entirely halt the decarbonization trend, as businesses have made investments based on the current incentives. The new administration may prioritize changes that support fossil fuels and traditional energy sources, leaving the HVAC industry divided on how these shifts impact future growth and electrification initiatives. Click here to read more.