Home Energy Upgrades from Public Utilities

Most people think of their electric or gas utility as the company that sends a bill. In much of the United States, and in a growing number of other countries, the utility is also one of the main ways households pay for insulation, heat pumps, efficient water heaters, smart thermostats, batteries and solar panels. Utilities run free home energy assessments, pay rebates, arrange low-interest or zero-interest loans, send contractors to install measures directly, and in some places attach the cost of upgrades to the meter so it can be repaid through the monthly bill.

Wikipedia describes home energy upgrades from public utilities as added energy-efficiency and renewable-energy features that utilities plan or install in homes, with utilities helping homeowners choose, install or operate equipment, coordinate energy use, arrange financing and connect to neighborhood energy supply. This article explains why utilities do this, how the programs are funded, what they offer, how the main financing models work, what the evidence says about results, and where the programs fall short. It ends with practical steps for households and a set of common questions.

Why a utility would help you use less of its product

At first glance it seems odd for a company that sells electricity or gas to pay customers to buy less of it. There are several reasons it happens anyway.

Efficiency as a resource

The central idea is that saving a kilowatt-hour can be cheaper than generating one. If a utility needs to meet growing demand, it can build a new power plant or transmission line, or it can pay to reduce demand by an equivalent amount. When the second option costs less, regulators and planners treat efficiency as a resource, comparable to a power plant. The American Council for an Energy-Efficient Economy (ACEEE), which publishes an annual scorecard of state policies, summarizes this view in a line it repeats often: "Energy efficiency remains our nation's least-cost energy resource."

Regulation and state law

Most U.S. utilities are regulated monopolies. State public utility commissions set their rates and can require them to run efficiency programs. Many states have energy efficiency resource standards or similar rules that set savings targets. Others collect a small charge on every customer's bill, often called a public benefits or public purpose charge, and use the money for efficiency and renewable programs.

Oregon is a clear example. In 1999 the state legislature passed Senate Bill 1149, which required Portland General Electric and Pacific Power to collect a 3% public purpose charge from customers starting in March 2002. Most of that money went to the newly created Energy Trust of Oregon, an independent nonprofit that opened its doors on March 1, 2002. A state report from the period noted that the Energy Trust received 73.8% of the available public purpose funds, with 56.7% dedicated to conservation and 17.1% to renewable energy. Today the Energy Trust is overseen by the Oregon Public Utility Commission and funded by small charges on utility bills. It offers efficiency advice, help finding contractors, cash incentives and financing.

Peak demand and the grid

Utilities also care about when energy is used. The most expensive hours for a power system are the peaks, such as hot summer afternoons or cold winter mornings. Upgrades that cut peak demand, and programs that let utilities shift when appliances run, can avoid the need for new peaking plants or grid upgrades. This is one reason utilities increasingly pay for home batteries, smart thermostats and managed electric vehicle charging, not just insulation.

Climate and public policy goals

Finally, many utilities face state climate targets or have set their own. Xcel Energy, for instance, is described in the Wikipedia article as the first major multi-state U.S. utility to commit, in 2018, to 100% carbon-free electricity by 2050. Reducing household energy use and electrifying heating with efficient heat pumps are part of how such goals are met.

How much money is involved

Utility efficiency programs in the United States are a multibillion-dollar enterprise.

The ACEEE and AGA figures for gas are measured differently and should not be expected to match exactly. What the numbers show clearly is scale and concentration. ACEEE reported that 2023 spending was about 16% above the 2020 low and 6% above the previous high in 2019, and that just five states accounted for most of the growth.

The same ACEEE scorecard, released in March 2025, ranked California first among states for the seventh time, followed by Massachusetts, New York, and Maryland and Vermont tied for fourth. Colorado rose six places to seventh. Louisiana was the most improved state, climbing nine places to 37th.

What utilities actually offer

Program names and details vary enormously, but most offerings fall into a handful of categories.

Home energy assessments

An assessment, sometimes called an audit or check-up, is often the starting point. A trained assessor visits the home, or in some programs guides the homeowner through a virtual assessment, and looks at insulation, air leaks, windows, heating and cooling equipment, water heating, lighting and appliances. The output is a list of recommended upgrades and the incentives available for each.

Examples from the Wikipedia article:

• Florida Public Utilities, part of Chesapeake Utilities, offers free energy check-ups with an "Energy Expert" who evaluates walls, windows, insulation, appliances and lighting and helps with rebates.
• Energize Connecticut lets homeowners begin with a free virtual pre-assessment.
• Xcel Energy helped residential customers with home energy audits in the Fargo, Grand Forks and Minot areas of North Dakota in 2019.

Rebates and incentives

Rebates are the most common tool. The utility pays part of the cost of a qualifying product or installation, either to the customer after the fact or to the contractor or retailer at the point of sale. Typical rebated items include:

• Air sealing and insulation
• Heat pumps for space heating and cooling, including ground-source (geothermal) systems
• Heat pump water heaters
• Efficient furnaces and boilers
• Smart thermostats
• LED lighting
• Efficient appliances
• Home batteries
• Home electric vehicle chargers

Rebate levels can be substantial. Mass Save, the Massachusetts program run jointly by the state's utilities, said in February 2024 that under its 2022 to 2024 plan, residential customers could receive up to $16,000 in incentives for air-source or air-to-water heat pumps installed through its installer network, and up to $25,000 for ground-source systems. Anaheim Public Utilities in California offered household battery storage rebates of up to about $3,000.

Direct installation

Some programs, especially those aimed at low-income households or renters, skip the rebate and simply install measures at no cost. Common direct-install items include LED bulbs, low-flow showerheads, pipe insulation, weatherstripping and smart thermostats.

Financing

Upfront cost is the biggest barrier for many households, so many utility programs offer financing. The main models are covered in detail in the next section: conventional low-interest loans arranged with partner lenders, on-bill financing and on-bill repayment, and tariffed on-bill programs such as Pay As You Save.

One-stop shops and advisers

Navigating rebates, contractors and financing is confusing. Several programs now assign a single adviser to guide each household. Efficiency Works, launched in northern Colorado in 2014 by Estes Park Light and Power, Fort Collins Utilities, Longmont Power and Communications, Loveland Water and Power, and Platte River Power Authority, assesses homes, assigns an efficiency adviser, and coordinates energy audits. As of December 31, 2017, it claimed savings equivalent to the annual energy use of 10,000 homes. Fort Collins identified three lessons from its experience in 2017: actively invite participation, ensure contractor quality, and provide an impartial adviser.

Grid services: batteries, thermostats and managed charging

A newer category treats the home as part of the grid. Utilities pay for or subsidize equipment and, in return, get the ability to draw on it at peak times.

• Green Mountain Power in Vermont began helping customers install Tesla Powerwall batteries in 2017. Using Tesla's software, it aggregated 2,000 batteries to cut system peak load by 10 megawatts, which it described as equivalent to removing about 7,500 homes from the grid at peak times.
• Portland General Electric announced in October 2018 a smart grid test bed with three smart grids serving more than 20,000 customers, where connected homes could be pre-heated or pre-cooled to reduce peak demand.
• Xcel Energy supported home EV charging in 2019, including training for car dealers and chargers that charge when rates are lowest. Many utilities offer rebates for home EV charging equipment to encourage off-peak charging.

New construction

Utilities also influence new homes. In California, the Public Utilities Commission helped builders construct zero net energy homes, and the state set a goal in 2018 for all new homes to be zero net energy starting in 2020. Clark Public Utilities in southwestern Washington offered New Construction incentives alongside financing for heat pumps, weatherization, rooftop solar and solar water heaters. The Wikipedia article lists features commonly encouraged in new homes: energy-efficient orientation, thermal mass walls, and geothermal heat pumps, which can reduce peak grid demand.

Financing models in detail

Conventional loans through the utility program

The simplest model is a loan from a bank or credit union, with the utility program paying down the interest rate. Mass Save's HEAT Loan is a widely used example. During the 2022 to 2024 plan period it offered 0% financing of up to $50,000 for qualifying upgrades when heat pumps were included, with terms of up to seven years. Mass Save announced that from January 1, 2025, the maximum financeable amount would drop to $25,000. The loan is a normal personal loan from a participating lender; the program buys down the interest.

On-bill financing and on-bill repayment

In on-bill programs, the household repays the cost of upgrades as a line item on its utility bill. Where the utility itself provides the capital, this is usually called on-bill financing. Where a third-party lender provides the money and the utility simply collects the payments, it is often called on-bill repayment. The advantage is convenience and, in some designs, the ability to qualify customers based on their history of paying utility bills rather than a credit score.

Tariffed on-bill: Pay As You Save

The most distinctive model is the tariffed on-bill approach, best known under the trademarked name Pay As You Save (PAYS). Instead of a loan to the person, the utility invests in upgrades at a specific location and recovers the cost through a charge attached to the meter, approved by regulators as part of the utility's tariff. If the occupant moves, the charge stays with the meter and the next customer pays it, along with getting the savings.

Ouachita Electric Cooperative in Arkansas runs one of the best-documented examples, called HELP PAYS. Its design rules illustrate how PAYS programs work:

• The monthly "Program Service Charge" is set below the estimated savings, capped at 80% of the estimated savings, and repaid within 80% of the upgrades' estimated useful life.
• Customers can qualify without traditional credit underwriting; the program has been described as voluntary and open regardless of economic status or type of home, with no credit check.
• The cooperative's own 2016 report found participation tripled compared with its earlier loan program. A Missouri regulatory presentation noted that the older loan program had capped investment at $3,000.

In 2022 researchers at Lawrence Berkeley National Laboratory (Jeff Deason, Sean Murphy and Greg Leventis) published an analysis of customer outcomes across five PAYS programs. Key findings:

• Most of the programs served zip codes with lower income and education levels and higher unemployment than national averages, which the authors suggested could improve equity in efficiency adoption.
• In a weather-normalized analysis of Midwest Energy's program in Kansas, average reductions were about 15% for electricity and 26% for natural gas. The authors noted that these changes reflect both the upgrades and changes in occupant behavior, and said the results were similar to analyses of PAYS programs in North Carolina, Arkansas and Tennessee.
• Only about half of participating Midwest Energy households saw energy cost savings large enough to cover their monthly charge. The authors suggested lower-than-expected savings may stem from occupant behavior, program error or outside factors.
• They recommended pairing PAYS with additional financial assistance and promoting low-cost measures such as air and duct sealing to broaden participation.

That last finding is important. A tariff designed to be "cash-flow positive" on paper is only as good as the savings estimate behind it. If savings come in lower than predicted, some households pay more than they save.

How a typical upgrade works, step by step

Program details differ, but a household going through a utility upgrade program usually follows a similar path.

1. Inquiry. The homeowner finds the program through a bill insert, the utility website, a contractor or a word-of-mouth referral, and signs up online or by phone.
2. Assessment. An assessor visits, or the homeowner completes a virtual assessment. Some programs use a blower door, a calibrated fan that depressurizes the house to measure how leaky it is, and an infrared camera to find missing insulation.
3. Recommendations. The household receives a report listing recommended measures, estimated costs, estimated savings and the incentives available for each.
4. Choosing a contractor. Many programs require work to be done by contractors on an approved list. Some, like Efficiency Works, assign an adviser to help compare bids.
5. Financing. If the household needs financing, it applies for the program loan, on-bill option or tariff at this stage.
6. Installation. The contractor does the work. Rebates may be paid to the contractor at the time of sale, reducing the price the customer pays, or claimed by the customer afterward.
7. Inspection. Some programs inspect a share of completed jobs, or all jobs above a certain size, to confirm the work was done to standard.
8. Payment and follow-up. The rebate is paid, and the household's later bills show whether savings appeared. Some programs follow up with surveys or analyze billing data.

Which upgrades usually come first

Energy advisers commonly recommend an order of operations, sometimes summarized as "reduce, then electrify, then generate."

• Reduce losses first. Air sealing and insulation reduce the amount of heating and cooling a home needs. They are often relatively inexpensive, and they can allow a smaller heating and cooling system to be installed later. LBNL's PAYS study specifically recommended promoting low-cost measures such as air and duct sealing.
• Replace equipment at the right time. Heating systems and water heaters are cheapest to upgrade when they are near the end of their lives anyway, because the household would have had to pay for a replacement regardless. Planning ahead avoids an emergency replacement with whatever is in stock.
• Electrify where it makes sense. Heat pumps for space and water heating are the focus of many current programs, including Mass Save and the federal HEAR rebates.
• Add generation and storage. Solar panels and batteries are often the most expensive items. Their value depends heavily on local rates, net metering rules and whether the utility pays for battery capacity at peak times.
• Plan for vehicles and panels. An EV charger or heat pump may require an electrical panel upgrade, which HEAR rebates can cover for qualifying households.

This sequence is not a rule. A household with a failing furnace in January will make different choices from one planning ahead, and a home with a new roof may be a better candidate for solar now than later.

How program savings are counted

Understanding how programs count savings helps when reading their reports.

Estimated, or "deemed," savings

For many standard measures, such as an LED bulb or a smart thermostat, programs use a fixed savings value per item agreed with regulators, based on prior studies. These are often called deemed savings. They are cheap to administer but may not match what happens in a particular home.

Modeled savings

For larger projects, such as whole-house retrofits, programs often use energy modeling software that takes the house's characteristics and predicts savings. HOMES rebates under the Inflation Reduction Act can be based on modeled savings.

Measured savings

The most rigorous approach compares a home's energy bills before and after the upgrade, adjusted for differences in weather. That adjustment is called weather normalization. LBNL's analysis of Midwest Energy's PAYS program used weather-normalized billing data. HOMES also allows a measured-savings path in some states.

"Homes' worth" figures

Program reports often translate savings into the number of typical homes' annual energy use. This makes large numbers easier to grasp, but it is only a conversion. It does not mean that many homes were upgraded. A program that "saved enough electricity for 10,000 homes" might have reached far more or far fewer households, depending on how much each saved.

Worked examples

The numbers below are hypothetical, chosen to illustrate the arithmetic. They are not quotes from any specific program.

Example 1: A rebate and a zero-interest loan

A hypothetical household plans a heat pump installation costing $20,000. The utility program offers a $10,000 rebate and a 0% loan for the remainder over seven years.

• Amount financed: $20,000 - $10,000 = $10,000.
• Months: 7 x 12 = 84.
• Monthly payment at 0%: $10,000 / 84 = about $119.05.

If the household's estimated energy savings were $80 per month, its monthly cash flow would be negative by about $39 during the loan term, and positive after the loan is repaid. If savings were $130 per month, it would be cash-flow positive from the start. The comparison depends heavily on the fuel being replaced and on local electricity and gas prices.

Example 2: A PAYS-style tariff

A hypothetical set of upgrades is estimated to save $600 per year and has an estimated useful life of 15 years. Using a design rule like Ouachita's:

• Maximum annual charge: 80% x $600 = $480.
• Maximum repayment period: 80% x 15 years = 12 years.
• Maximum total recovered: $480 x 12 = $5,760.

So the utility could invest up to about $5,760 (before accounting for financing costs) in upgrades at that address. If savings come in as estimated, the occupant is ahead by $120 a year during repayment and by $600 a year afterward. If savings come in at only $400 a year, the occupant pays $80 more per year than they save during repayment, which is the outcome LBNL found for roughly half of the Midwest Energy households it studied.

Example 3: Comparing program savings claims

Program reports often express savings as "homes' worth" of energy. Xcel Energy's eastern New Mexico programs, for example, saved 39.4 gigawatt-hours of electricity in 2019, which the Wikipedia article describes as about 3,590 typical homes. Dividing gives:

• 39,400,000 kWh / 3,590 homes = about 10,975 kWh per home.

That is close to the U.S. Energy Information Administration's figure of about 10,791 kWh bought by the average residential customer in 2022, which is the conversion the Wikipedia article uses. Knowing this lets you translate any "homes' worth" figure back into energy units.

Results reported by utilities

The Wikipedia article compiles a set of program results, mostly as reported by the utilities and program administrators themselves. They are useful as an indication of scale, though they are not independent evaluations.

Some of these programs have also been recognized externally. Xcel's Minnesota Home Energy Squad, One-Stop Efficiency Shop and Partners in Energy programs won ACEEE's 2019 Exemplary Program Award. Xcel began tracking the results of its efficiency assistance in 1992.

Other examples:

• Anaheim, California: Anaheim's solar programs produced about 50 million kWh a year as of 2021, enough for about 4,700 typical homes.
• Solar co-ops in Florida: Solar United Neighbors, a nonprofit, had arranged group solar purchases for 60 groups in Florida as of March 2021; its 2017 Alachua County co-op installed panels at 81 homes. This is a nonprofit model rather than a utility one, but such co-ops interact with utility net metering and interconnection rules.
• Juneau, Alaska: In 2018 the city considered replacing heating oil with heat pumps powered by its hydroelectric supply, and Alaska Electric Light and Power planned initial steps.

Beyond the United States

The Wikipedia article includes several international examples that show the same ideas in different forms.

• Australia: Greentech Media reported in 2016 that utilities had begun offering home battery upgrades, with battery sellers partnering with utilities. By 2018 utilities were seeking closer relationships with homeowners whose batteries could help balance the grid and reduce the need for new conventional plants. South Australia ran a Home Battery Scheme.
• France: Électricité de France (EDF) has offered residential services including smart meters, energy monitoring via computer or smartphone, home energy performance assessments, advice on heating (including heat pumps and solar water heating), and installation of LED lighting and heating controls.
• China: In 2016 China issued a national Standard for Energy Consumption of Residential Buildings. Rocky Mountain Institute noted that no other country with similar building stock had released a comparable national standard.
• India: In 2016 the Climate Policy Initiative analyzed barriers to rooftop solar for property owners, including financing, net metering and installation, with roles for the Ministry of New and Renewable Energy, state governments and state distribution companies.
• The Bahamas: After Hurricane Irma, Bahamas Power and Light developed a solar-and-battery microgrid on Ragged Island, an outer island that had relied on diesel generators. Built by Tugliq Energy with partner Salt Energy, it includes 402 kWp of solar coupled with the existing diesel plant.
• Colombia: Empresas Públicas de Medellín (EPM), the city-owned utility, has supported Medellín's broader sustainability and social programs.

The federal layer in the United States

Utility programs do not operate alone. Federal money has, at different times, been layered on top.

Inflation Reduction Act home energy rebates

The Inflation Reduction Act of 2022 allocated $8.8 billion to two Department of Energy home rebate programs administered by states:

The programs run until funds are exhausted or September 30, 2031. Rebate amounts and eligibility rules are set state by state within federal limits; one tracker, for example, listed heat pump water heaters at up to $1,750 per appliance. Many states route these rebates through, or coordinate them with, existing utility programs.

Rollout has been slow and uncertain. Utility Dive reported in August 2025 that 12 states plus the District of Columbia had launched one or both programs, several in pilot form, according to the National Association of State Energy Officials (NASEO). All states except South Dakota had applied and received conditional awards. A DOE spokesperson said the department was "continuing to conduct a department-wide review," and negotiations with most states were on hold. NASEO president David Terry said he had been "repeatedly" assured that obligated funds "will ultimately get out the door," while criticizing DOE for putting "an extraordinary number of requirements on these programs that were not in statute."

Tax credits ended

Federal tax credits that many households combined with utility rebates have ended. The Energy Efficient Home Improvement Credit (Section 25C), which covered items such as insulation, windows and heat pumps, and the Residential Clean Energy Credit (Section 25D), which covered solar, batteries and geothermal heat pumps, were cut short by Public Law 119-21, signed July 4, 2025. IRS guidance says the 25C credit is not allowed for property placed in service after December 31, 2025, and the 25D credit ends for expenditures after that date. That makes utility programs a more important source of support than they were before.

The business case for utilities

Whether utilities should go further, and actually sell home energy services as a line of business, has been studied. In 2014 Rocky Mountain Institute worked with Fort Collins Utilities on an "Integrated Utility Services" model, in which the utility would offer a package of upgrades, financing and services. RMI's December 2014 estimate suggested home energy upgrades could be as profitable to a utility as conventional electricity and gas sales, with the projected share of Fort Collins Utilities' income from single-family home services rising from 8% to 12% of revenue.

The model depends on regulation. Under traditional rate-making, a utility's profits rise with sales, which gives it a reason to resist efficiency. Many states have addressed this through mechanisms that separate revenue from sales volume or pay performance incentives for achieving savings, though the details vary widely from state to state.

Limits and criticisms

Utility upgrade programs have real achievements, but they also face consistent problems.

Savings that fall short

Program savings are often estimated in advance, using engineering models, and only sometimes measured afterward. When they are measured, they can fall short of projections. LBNL's PAYS study found that only about half of Midwest Energy participants saved enough to cover their monthly charge, even though the program was designed to be cash-flow positive. Occupant behavior, contractor error and outside factors all play a part.

Free riders

Some rebate recipients would have bought the efficient product anyway. Evaluators call them free riders. Every dollar spent on a free rider is a dollar that did not change behavior. Program evaluators try to estimate and adjust for this, but it is inherently uncertain.

Contractor quality

An upgrade is only as good as its installation. Poorly sealed ductwork, undersized or oversized heat pumps, and gaps in insulation can wipe out expected savings. Fort Collins listed contractor quality as one of its main lessons, and many programs now require participating contractors to be trained and approved.

Delays and complexity

Programs can be hard to navigate. CBS News Boston reported in its "I-Team" coverage on homeowners who experienced long delays receiving promised Mass Save heat pump rebates. Multiple overlapping programs, each with its own rules, can confuse homeowners and contractors alike. One-stop shops and impartial advisers are partly a response to this.

Who pays and who benefits

Utility programs are typically funded by charges on all customers' bills, but the benefits go mostly to participants. Households that own their homes and have the money to co-fund upgrades tend to participate more. Renters face a "split incentive": the landlord would pay for upgrades, but the tenant pays the energy bills. Income-qualified programs, direct installation, PAYS-style tariffs and the federal HEAR program are all attempts to widen participation.

Budget pressure

Program budgets are set through regulatory proceedings and can shrink. Massachusetts approved a $4 billion budget for Mass Save's 2022 to 2024 plan, then a 2025 to 2027 plan capped at $4.5 billion after debate over the effect of program costs on bills. Changes to incentive levels, like the reduction in Mass Save's maximum HEAT Loan amount from $50,000 to $25,000 in 2025, show that offers available one year may not be available the next.

Common misconceptions

"Utility rebates are only for low-income households." Many programs are open to all residential customers, with extra incentives for income-qualified households.

"A free audit is a sales pitch." Utility-run assessments are usually funded by program charges and are meant to identify savings opportunities. Some are performed by contractors who may also offer to do the work, so it is reasonable to get more than one quote.

"PAYS is a loan." In a tariffed on-bill program, the obligation is tied to the meter through an approved tariff, not to the person as a loan. The charge stays with the property if the occupant moves.

"An upgrade designed to pay for itself always will." Savings estimates can be wrong. Evaluations of PAYS programs show that some households save less than their monthly charge.

"Federal tax credits can be stacked with utility rebates." They could in the past. The 25C and 25D residential credits ended for property placed in service or expenditures after December 31, 2025. State-administered IRA rebates may still be available where states have launched them.

"Only electric utilities run these programs." Gas utilities spent about $1.42 billion on efficiency programs in 2023, according to the American Gas Association.

Practical guidance for households

1. Start with your utility's website. Search for "home energy assessment," "rebates" or "efficiency programs." Many utilities have a single page listing current offers, and some states have a statewide program brand (Mass Save in Massachusetts, Energize Connecticut, Energy Trust of Oregon, Energy Upgrade California).
2. Get an assessment before buying equipment. Air sealing and insulation are often the cheapest savings and can let you install a smaller, cheaper heating system. LBNL's PAYS study specifically recommended promoting low-cost measures such as air and duct sealing.
3. Check whether your state has launched IRA rebates. HOMES and HEAR are administered by state energy offices. Availability and amounts vary by state and income level.
4. Ask about financing options. Compare the utility program's loan or on-bill option with other financing. Check whether the offer is 0%, what the term is, and whether there are fees.
5. If a PAYS-style tariff is offered, ask how the savings estimate was calculated, what the monthly charge will be, and what happens if savings come in lower than projected or if the equipment fails.
6. Use approved contractors where programs require them, and get more than one quote. Ask for proof of training and references.
7. Keep paperwork. Rebates often require invoices, model numbers and photos. Delays are common; follow up if payment does not arrive in the stated time.
8. Look at grid programs. If you have or plan to get a smart thermostat, battery or EV charger, check whether your utility pays for enrolling it in a demand response or managed charging program.
9. If you rent, ask your utility about renter-eligible measures and whether there are programs that pay landlords to upgrade rental properties.

Frequently asked questions

What is a home energy upgrade program? It is a program, usually run or funded by a utility, that helps households reduce energy use or produce their own energy through assessments, rebates, financing or direct installation of measures such as insulation, heat pumps, efficient appliances, batteries and solar.

Who pays for utility efficiency programs? Mostly utility customers, through charges built into rates or a separate public benefits charge on bills. In Oregon, for example, a 3% public purpose charge created by Senate Bill 1149 funds much of the Energy Trust's work.

How much do U.S. utilities spend on these programs? ACEEE reported a record $8.8 billion in 2023, including $6.9 billion for electric programs and $1.9 billion for gas programs.

What is on-bill financing? An arrangement in which the cost of upgrades is repaid through a line on the utility bill. In tariffed versions such as Pay As You Save, the charge is attached to the meter rather than the person.

Do PAYS programs save money? LBNL's study of Midwest Energy's program found average reductions of about 15% in electricity and 26% in gas use, but only about half of households saved enough to cover their monthly charge.

What did the Inflation Reduction Act add? $8.8 billion for two state-run rebate programs, HOMES ($4.3 billion) for whole-home savings and HEAR ($4.5 billion) for electrification for income-qualified households, with HEAR rebates of up to $14,000 per unit. Rollout has been uneven, with 12 states and DC having launched at least one program as of August 2025.

Are federal tax credits for home efficiency still available? The 25C and 25D residential credits ended for property placed in service or expenditures after December 31, 2025, under Public Law 119-21.

Why do utilities pay for home batteries? Batteries can be aggregated to reduce peak demand. Green Mountain Power used 2,000 customer batteries to cut its peak load by 10 megawatts.

Which states have the strongest programs? ACEEE's 2025 scorecard ranked California first, followed by Massachusetts and New York, with Maryland and Vermont tied for fourth.

What should I do first? Get a home energy assessment through your utility or state program, then prioritize low-cost air sealing and insulation before replacing major equipment.

Sources

• Home energy upgrades from public utilities - Wikipedia
• State energy efficiency investment hit a record $8.8B in 2023: ACEEE - Utility Dive
• 2023 Natural Gas Efficiency Programs Report - American Gas Association
• Customer outcomes in Pay-As-You-Save programs - Lawrence Berkeley National Laboratory
• Ouachita Electric HELP PAYS Report 2016
• Pay As You Save: Arkansas cooperative harnesses innovative financing - Utility Dive
• States' energy efficiency rebates and the Inflation Reduction Act - Utility Dive
• Coordinating DOE Home Energy Rebates with tax credits - U.S. Treasury
• IRS provides FAQs on expiring clean energy tax breaks - Financial Planning
• Mass Save HEAT Loan
• Mass Save sponsors announce record heat pump installations
• Mass Save three-year plan approved - WBUR
• Homeowners experience long delays getting Mass Save heat pump rebates - CBS News Boston
• Energy Trust of Oregon - Oregon Encyclopedia
• Energy Trust of Oregon 2002 Annual Report
• Efficiency Works - About
• Integrated Utility Services for Fort Collins - Rocky Mountain Institute (2014)
• Green Mountain Power recognized for energy storage - VTDigger
• Tugliq Energy - Ragged Island microgrid
• How much electricity does an American home use? - U.S. EIA