How New Yorkers can save on heating bills with tax credits and incentives

The challenges of heating a home on Long Island are perhaps never more vexing than what Barbara Brennan deals with every morning in her living room.

The seating area at the front of her tidy Center Moriches cottage remains a toe-chilling 60 degrees for an unbearably long time after she cranks up the heat. Meantime, it's inexplicably balmy in her tenant’s adjoining apartment, which shares the same boiler, soaring to 74 degrees without any prodding from his thermostat.   

“How’s he getting heat?” Brennan, 78, wondered aloud on a gusty afternoon earlier this month. “He says his temperature is set at 66.”

The question was one of many that Brennan hoped to sort out when she agreed to open her home to an energy audit.

For those who try them, energy audits are both an investigation of their home’s heat-trapping capabilities as well as an expert strategy session on the best ways to keep more air inside. They’re also the starting point for potentially thousands of dollars in financial incentives for energy-saving upgrades. 

And for homeowners with low incomes, audits could lead to winterization upgrades for free.

To be clear, companies that perform audits will profit off of any products they end up installing. Efficiency upgrades also cost a lot of money, regardless of the incentives, and it can be tough to accurately measure how much of those upfront costs will be recouped through lower energy bills.

Even so, there’s never been a better time to schedule one, said Warren Leon, executive director of the nonprofit Clean Energy States Alliance, which advises 18 states including New York on environmental initiatives. Improvements in efficiency-boosting technologies, combined with a heap of new federal money from the Inflation Reduction Act, likely will make 2024 a banner year for energy efficiency, he said.

“There are more appealing incentives than ever before,” Leon said. “And there are greater opportunities for homeowners to make significant improvements that both reduce their greenhouse gas emissions and save them money.”

Audits, or residential energy assessments, are like doctor’s visits, only for homes. And the best part is they’re free.

Here’s how they work: PSEGLI pays for efficiency experts to come to your home to check how well it holds its temperature. They’ll look for air seeping through cracks in the walls. They’ll measure the level of insulation in the attic. They’ll examine the wear and tear on your HVAC system and determine if it’s performing as efficiently as possible.

“People have no idea how much they can save” on their energy bills, said Jay Best, founder of Green Team Long Island, a home efficiency contractor that conducts about 50 energy audits per week. “A lot of people have just come to accept the cost of heating and cooling their home.”

Incentives galore 

Homeowners this year can take advantage of federal tax credits for solar panels, heat pumps, high-efficiency water heaters and air conditioners. There are tax credits for energy saving windows and skylights, attic and wall insulation, electric panel upgrades and exterior doors.  

New Yorkers who buy many of these products will be eligible for state tax credits as well. 

Meanwhile, PSEGLI offers community solar programs that allow its customers to slice 5% to 10%  off of their electricity bills. And if you buy a smart thermostat through its online marketplace, the utility will pay you up to $100. If you have a central air conditioner, PSEGLI will give you a one-time payment of $85 if you participate in its Smart Saver program that adjusts your smart thermostat during times of peak demand, plus $25 every year that you remain enrolled in the program. 

What’s more, later this year, the New York State Energy Research and Development Authority, the agency that administers the state’s energy efficiency programs, is expected to announce a new rebate program for a variety of clean energy upgrades, allowing people to cut sticker prices up front for certain clean energy products. 

“Those rebates will be structured in ways that allow low and moderate income individuals to qualify for greater rebates than other homeowners,” Leon said.

Brennan hopes that some of that money can be invested in her home.

The retired loan officer paid more than $2,300 for heating oil last year — a big item in her budget that may not get any cheaper this year. Her electric bill will increase next month to almost $150. The monthly procession of utility bills never seems to get any cheaper, no matter how vigilant Brennan gets with her thermostat, or how faithfully she switches the lights off in rooms that she’s not using.

Keeping the warm air in 

“So how leaky is my house?” Brennan asked as Green Team energy auditors worked their way through her bedrooms.

“You’re better than some, worse than others,” said Jamie Culbertson, Green Team’s vice president of energy efficiency solutions, who led the audit team. 

The Holbrook-based crew inspected the insulation in Brennan’s attic and upstairs crawl spaces. They installed a negative-pressure fan in her front door and scanned her walls for leaks with infrared cameras.

They noted where cobwebs were stitched along the ceiling (spiders tend to place their webs in drafty parts of the home), and they measured the ventilation out of the second floor attic fan (a major source of lost heat). They peered inside Brennan’s boiler, analyzing the efficiency, draft direction and carbon monoxide levels. 

As for the uneven heating between her living room and her tenant’s apartment, Culbertson said that her tenant was likely benefiting from being close to the boiler, which radiates heat into his apartment no matter what he does with his thermostat.

“Heat goes in all directions,” Culbertson told Brennan. “When these units are running, it gets even warmer” in the tenant’s apartment. 

Replacing her boiler with a heat pump would likely solve the problem, he said, given that it's located in the attic and doesn't radiate the same amount of heat.

Overall, he said, Brennan’s home was struggling to stay warm. Culbertson estimated that it allowed twice as much air to escape as it should. In other words, her heater works twice as hard as it should to warm up the house.

That’s actually not as bad as some of the old farm homes on Long Island, Best said, which can be so leaky that homeowners will need to crank up their boilers to heat five or six times as much air as newer homes in an effort to keep up with all of the warm air that has escaped.  

At a minimum, Culbertson said, Brennan should seal her attic and layer in more insulation to reduce the amount of hot air escaping through the roof. She’d also benefit from getting rid of her attic exhaust fan, many of which were installed in Long Island's older homes to ventilate the interior and draw warm air out in the summertime. 

And Brennan might want to consider replacing her hot water heater and boiler, which run on heating oil, with state-of-the-art electric heat pumps, which come with thousands of dollars in tax incentives, and can act as both a heater in the winter and air conditioner in the summer. 

These systems are expensive though. Culbertson said they would cost anywhere between $15,000 and $30,000 to install, depending on the size of the pump, which would be offset by up to $12,000 in rebates from PSEGLI and up to $2,000 in federal tax credits. The state also is expected to offer additional rebates on heat pumps that could slash the cost by thousands of dollars more.

Once installed, Brennan likely would save about 50% on her annual energy bills if she made the switch, Culbertson said.  

Brennan said she’s considering her options. At the very least, it was worth it to find out how, exactly, she can reduce her energy bills. And it felt good to know that a heat pump would solve her heating issues with her tenant.  

"I'm not sure if I can afford it," Brennan said. "I'm really hopeful that I'm eligible for some type of program that would help me pay to get these installed."