TL/DR –
The 2022 Inflation Reduction Act (IRA) in the United States contains financial incentives to hasten the shift towards a low carbon economy. One such initiative detailed in the article is the introduction of heat pumps, a technology invented in 1856, for heating, ventilation and air conditioning (HVAC) in homes. The author presents Tetra, a home services company focused on HVAC systems using heat pumps, and details how the IRA could provide up to $14,000 per household for heat pump installation, potentially leading to a significant reduction in carbon emissions.
COP28 Climate Change Conference Discusses Global Temperature Limit Increase
World leaders recently convened in Dubai at the COP28 UN Climate Change Conference, deliberating on how to cap global temperature rise to 1.5 degrees Celsius. Regrettably, this is a target we are likely to overshoot, which could lead to a worsening climate crisis and irreversible harm to our planet.
Surprising Agreement Offers Hope
Notwithstanding, the conference surprisingly concluded with an agreement to transition away from fossil fuels. Despite significant hurdles such as opposition from OPEC and the conference President’s role as CEO of a major oil producer, this non-binding agreement signals a positive direction away from fossil fuels.
US’s 2022 Inflation Reduction Act Accelerating Low Carbon Economy Transition
The United States provides further optimism with the 2022 Inflation Reduction Act (IRA), which contains generous incentives to expedite the transition to a low carbon economy.
In the US, powering, heating, and cooling homes account for roughly 20% of carbon emissions, with natural gas and fuel oil burning contributing over half. A change in how we heat and cool our homes is imperative to combating climate change.
Investment in Tetra
We are thrilled to announce our investment in Tetra, a home services company leading the clean energy transformation, starting with heating, ventilation, and air conditioning (HVAC).
Decarbonizing HVAC with Heat Pumps
Decarbonizing HVAC is not a new concept. Heat pumps, invented in 1856 and popular in Europe, safely and affordably extract heat from the air and transfer it where needed. As they are moving heat rather than generating it, they are more efficient than any other technology.
Heat pumps are also not new to the US, with over 40% of homes in states like South Carolina, North Carolina, and Alabama using them. They have been falsely criticized for being ineffective in cold weather, despite two-thirds of households in Norway, one of the world’s coldest countries, utilizing them.
Safety, Cost Efficiency and Environmental Impact of Heat Pumps
Heat pumps are safer and less costly to operate than fossil fuel systems. Replacing older systems can save an average household up to $1,000 a year, while eliminating health risks associated with fossil fuels. Additionally, 3% of all natural gas leaks before reaching its destination, causing deadly explosions and poisoning.
Heat pump sales outstripped natural gas furnace sales last year, with 4.3 million units sold. If every American home switched to a heat pump, it would equate to removing 32 million cars from the road.
Advantages of Investing in Heat Pumps
The IRA is set to propel heat pumps into the limelight. While they have historically had a higher up-front cost than fossil fuel systems, this is changing. The IRA will offer incentives of up to $14,000 per household for heat pump installation and related expenses, making them cost competitive for the first time. As these incentives start rolling out to states in 2024, we anticipate a significant shift towards low carbon heating and cooling in the US.
Excitement for Tetra’s Future
Max Veggeberg, Tetra’s Founder and CEO, has a vision and domain expertise that impressed us. With the windfall of the Inflation Reduction Act behind us, we are confident that Tetra is the right company to lead the clean energy transformation. We look forward to supporting Max and his team in this exciting journey ahead.
—
Read More US Economic News