Home Improvements Get the ‘Green’ Light

Americans are already in a home improvement mindset thanks to the increased time they spent in their dwellings during the pandemic. According to a survey released in April from home design and decorating company Houzz, 55 percent of homeowners tackled a home renovation project in 2021—the highest rate since 2018. And although remodeling activity has cooled in the latter half of 2022 due to increased costs and other economic factors, the Harvard Joint Center for Housing Studies still expects the home remodeling market to expand to $450 billion in 2023—fueled in large part by subsidized energy-efficient retrofits. 

“There’s great destruction and suffering coming if we don’t rid ourselves of fossil fuels soon,” Nowak says. “People think [natural] gas—which is heavily subsidized, and the price of it is about to go up—is clean energy, but it’s not.” In reality, natural gas, which fuels water and space heating in about half of American homes, is a fossil fuel composed mostly of methane, a potent greenhouse gas that greatly contributes to global warming. Its continued use is part of the reason why 20 percent of U.S. energy-related greenhouse gas emissions come from homes. A recent study also found that greenhouse gases emitted by natural gas stoves in the U.S. is equal to that of half a million cars. 

“Electrifying your home is currently one of the most effective means of combating the climate emergency." Bill Nowak, a board member of the New York Geothermal Energy Organization

“Electrifying your home is currently one of the most effective means of combating the climate emergency,” says Nowak. (Electrification means replacing appliances and tech that rely on fossil fuels with those that use electricity.) In a 2022 study published in the journal Energy Policy, University of California Davis researchers showed that a typical U.S. home can cut its heating-related climate pollution by up to 72 percent by swapping out a gas-fired furnace for an efficient, all-electric heat pump (which transfers heat from one place to another rather than creating it)—the highest-priority replacement because heating and cooling are by far the biggest energy sucks, according to Nowak. And while America’s electrical grid is currently powered (in part) by natural gas, renewable energy (hydropower, wind, and solar) is starting to close the gap—and will continue to do so thanks to key industry investments provided by the IRA.

As for reducing costs, home electrification can save consumers money. Rewiring America, a climate nonprofit that supports electrification, predicts that households will save $1,800 per year if they fully convert to electricity (including installing heat pumps and solar panels). Part of this is because many electric-powered appliances consume less energy. For example, using modern electric heat pumps to heat your home uses about 50 percent less electricity than furnaces and baseboards. 

“Heat pumps are vastly more efficient because they’re not burning fuel to create heat—they’re converting heat that’s already in the air. Even when it’s below zero, there’s still some heat in the air,” says LEED-certified general contractor Jon Pope, owner of Jon Pope Construction in Brooklyn, New York, and an advocate for clean energy. 

To date, the typically higher up-front costs of installing greener options may have been a barrier for many consumers. For example, data from HomeAdvisor finds the average cost of installing a heat pump is $5,900, while a furnace installation will run about $4,700 on average. But included in the IRA—which is projected to reduce greenhouse gases by 40 percent below 2005 levels by 2030—are special incentives specifically designed to make eco-friendly decisions for homeowners easier on your wallet. Folks can receive up to $14,000 per household in up-front discounts for qualified green projects, such as installing a heat-pump-powered water heater, an electric stove or cooktop, or new electric wiring. “We’re going to see a lot more people making this switch because it makes short- and long-term financial sense on top of being more eco-friendly,” says Pope.

Folks can receive up to $14,000 per household in up-front discounts for qualified green projects, such as installing a heat-pump-powered water heater, an electric stove or cooktop, or new electric wiring.

Rising energy costs—particularly of natural gas—will likely also spur people to make the jump to electrification. According to data from the U.S. Energy Information Administration, households that use natural gas will pay 28 percent more on their heating bills this winter compared to last year. (The agency predicts that electricity costs will go up 10 percent by comparison.) “Today you might find that the cost for some of these upgrades results in bills that aren’t too different, but electricity is the future,” says Nowak. “Those left using fossil fuels in their homes will ultimately pay more as local utility companies opt for cheaper and greener sources of energy. And the planet is demanding that we collectively make greener choices.”

Laws curbing new gas infrastructure at the state and city level will further incentivize people to pursue green home solutions in the coming year. Washington State’s law mandating heat pumps in new builds, passed in November, will go into effect in July 2023. New York City’s plan to phase out natural gas hookups in new buildings will also go into effect in 2023, while its upstate cousin Ithaca pledged last year to electrify and decarbonize all of its buildings by 2030. (New York is also considering a bill that would require electrification in all new construction state-wide, although it has yet to pass.) This September, Boston pledged to ban all fossil fuels in most new builds. In California, Los Angeles’s ban on gas stoves goes into effect on January 1, and the state has committed to phasing out new gas furnaces and water heaters by 2030.