June 2026 – What Contractors Need to Know – Executive Analysis of Program Changes
Summary
The U.S. Department of Energy (DOE) recently updated the Federal Home Energy Rebates Program (HOMES & HEEHR), making it easier for states to launch and administer federally funded programs while also limiting rebates for many gas-to-electric conversion projects.
The changes do not affect Ferguson’s strategic focus on utility engagement and midstream rebate programs, as these are primarily or entirely funded by ratepayers and state-level initiatives. We anticipate that utility rebate programs will continue to maintain or expand, given individual state energy efficiency goals.
Key Changes
- Fewer federally funded rebates for fuel-switching projects – gas, propane, oil to electric in many cases
- Less paperwork and red tape for states and contractors
- More flexibility for states on eligible products and project costs
What this Means for Contractors
The Good:
- Simplified program requirements
- Potentially faster rebate approvals and payments
- More states may move forward with launching programs
The Challenge:
- Certain heat pump and electrification projects may receive lower federal rebate amounts than originally anticipated, particularly when replacing fossil-fuel equipment with electric alternatives
- Homeowners may need additional education on changing eligibility requirements
The Bigger Picture:
While federal rebate rules have changed, most utility rebate programs are unaffected. Utilities across the country continue to offer strong rebates for heat pumps, heat pump water heaters, smart thermostats, demand response technologies, and other energy-efficient upgrades.
What You Can Do
- Engage The Ferguson Utility Programs Sales Team for rebate program navigation support
- Continue promoting high-efficiency equipment, as many utility-sponsored rebates remain available and can significantly improve project economics
- Help educate customers on federal program changes and available rebates
- Direct customers to FergusonRebates.com to explore available federal, state, and utility rebates
The Bottom Line:
Federal rebates may be reduced, but contractors should continue leveraging the significant utility rebates available in many markets. Ferguson remains well-positioned to assist contractors and sales teams with the navigation of available rebate opportunities, to help reduce project costs and drive sales.
Appendix A – Source References:
U.S. Department of Energy – Home Energy Rebates Program
Utility Dive – DOE Issues Guidance on Home Energy Rebate Programs
Sierra Club – New Guidance Weakens Home Energy Rebate Programs