The Rheia Air Distribution Solution Helps Builders Qualify for 45L Credits

Using Rheia as an HVAC distribution solution, energy-efficient home builders can benefit naturally from improved 45L federal tax credits. The Inflation Reduction Act revised and extended the 45L tax credit found in Section 13340 of the tax code and rewards the energy-saving advantages of bringing ducts into conditioned space. That means properties acquired on or after January 1, 2023, are eligible to receive tax credits with ENERGY STAR-certificated single-family, manufactured, and multifamily homes through 2032.

The key 45L provisions of the law include:

• A new expiration date of December 31, 2032, though the current language for the 45L tax credit extends through December 31, 2022.
• Several additions and increases that can be added to 45L on January 1, 2023. Homes meeting the EPA’s ENERGY STAR Single Family New Homes Program can now receive a tax credit of $2500 per home. Department of Energy (DOE) Certified Zero Energy Ready homes qualify for a $5,000 tax credit.
• The following dates are critical for ENERGY STAR single-family home inclusion in the credits. Single-family homes acquired between January 1, 2023, and January 1, 2025, are subject to EPA national program requirements version 3.1. Single-family homes acquired after January 1, 2025, are subject to EPA program requirements version 3.2.
• Manufactured Homes are also eligible for a $2,500 credit if they meet ENERGY STAR Manufactured New Homes program requirements (Version 2 or later).
• Multifamily units can receive $500 each on ENERGY STAR-certified multifamily units meeting the ENERGY STAR Multifamily New Construction National program requirements, outlined in Section 13304. Larger tax credits are available if the multifamily projects meet defined wage requirements. Larger tax credits of $2,500 per unit are possible with the DOE Zero Energy Ready (ZERH) Program, which can be in addition to ENERGY STAR certification.

Rheia Makes a Difference in DOE Zero Energy Ready Homes (ZERH)

ZERH certification is similar to HERS and recognizes registered builders who incorporate improved energy efficiency, indoor air quality, and zero-energy ready practices into their builds. These homes are qualified by a third party to be at least 40% more energy efficient than similarly sized new homes. The 45L tax credit aims toward a carbon-neutral future. According to DOE, HVAC systems in residential homes are typically responsible for 50% of total home energy consumption, and 30% of that energy used by HVAC systems is wasted due to ducts and air handlers being housed in unconditioned spaces (attics, crawl spaces) where they are not conditioning the actual home. New codes and DOE incentivize the installation of ducts and equipment inside the home’s thermal envelope, in an already conditioned space.

Rheia’s air distribution technology is designed to cost-effectively locate the HVAC ducts and equipment within the home’s conditioned space. Conventional insulated ductwork is bulky, requiring large bulkheads and chases when installed in the home’s conditioned space; increasing the total HVAC cost, along with being time-consuming and aesthetically challenging. Rheia’s compact, uninsulated ducts, and engineered high-performance components fit easily into wall and floor cavities, achieving that goal while being cost-effective and unintrusive.

Learn more details in Rheia's 45L tax credit summary.