In 2023, more than 117,000 Michigan families saved over $134 million on clean energy and energy efficiency investments, according to new data released by the U.S. Department of the Treasury (Treasury). This announcement comes ahead of the two-year anniversary of the Inflation Reduction Act.

The data from the IRS and analysis by the Office of Economic Policy reveal that these Michigan families benefited from tax credits aimed at reducing the costs associated with clean energy and energy efficiency upgrades to their homes. This is the first public release of such data from 2023 tax filings, demonstrating the impact of the Inflation Reduction Act's clean energy tax incentives for consumers.

Nationally, there has been a significant increase in families benefiting from these expanded credits compared to tax year 2021, before the Inflation Reduction Act was enacted. The number of beneficiaries increased by nearly one-third, while the aggregate value of credits rose by almost two-thirds. The new data indicates that the Act is successfully lowering both upfront costs for clean energy investments and monthly utility bills for American families.

Recent research from U.S. national labs and Treasury’s Office of Economic Policy shows that consumers who adopt these upgrades can save hundreds or thousands of dollars annually on their utility bills. For instance, households installing residential solar have saved a median of $2,230 per year. Those installing efficient heat pumps and improving building efficiency could save between $600 and $3,100 annually, depending on the type of heating and cooling system replaced.

“The Biden-Harris Administration’s top economic priority is lowering costs for American families, and the Inflation Reduction Act is advancing that goal by making home energy upgrades more affordable and cutting monthly utility bills,” said U.S. Secretary of the Treasury Janet L. Yellen. “The law has lowered the cost of clean energy upgrades for more than 117,000 Michigan families, saving them hundreds if not thousands of dollars annually on their utility bills for many years to come.”

Representative Debbie Dingell (MI-06) highlighted that "the Inflation Reduction Act is the single largest investment in clean energy and climate actions in American history." She noted its role in creating thousands of good-paying clean energy jobs in Michigan over the past two years and strengthening communities against climate crisis effects like catastrophic floods and fires.

Michigan families have claimed over $54 million in credits for residential clean energy investments on 2023 tax returns filed through May 23, 2024. These credits support investments in solar electricity generation, solar water heating, battery storage, among others. Additionally, more than $79 million has been claimed for energy-efficient home improvements such as heat pumps, efficient air conditioners, insulation, windows, and doors during this period.

Nationwide data shows over 750,000 families claimed investments in residential solar electricity; more than 250,000 invested in electric or natural gas heat pumps; over 100,000 invested in heat pump water heaters; nearly 700,000 invested in insulation and air sealing.

The Inflation Reduction Act provides incentives to lower consumer energy bills and protect against future fossil fuel price spikes. It extended and expanded several credits including:

- Energy Efficient Home Improvement Credit: Up to $1,200 annually for various improvements with an additional credit up to $2,000 for electric heat pumps.

- Residential Clean Energy Credit: Up to 30% coverage on costs for installations like rooftop solar through 2034.

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