Q&A: How Tennessee is preparing for successful Inflation Reduction Act programs

As homeowners across the United States await the launch of Home Energy Rebates (HER) programs funded through the Inflation Reduction Act (IRA), stakeholders are working hard to plan these complex programs and deliver more than $8 billion in energy efficiency incentives. To make the most of this opportunity, states and territories will collaborate with key partners like utilities and statewide energy efficiency programs to apply for these funds and implement the new programs effectively.

In Tennessee, our collaboration with the Tennessee Valley Authority (TVA) has provided valuable experience in this process. TVA, which serves nearly the entire state of Tennessee and parts of neighboring states, has a robust portfolio of energy efficiency programs. Their experience offers useful lessons on delivering HER programs effectively.

We spoke with Mandy Faulk, our Senior Program Director working with TVA, to get her thoughts on the ground-level planning and upcoming implementation of these programs.

How far along is Tennessee in implementing or planning their IRA programs?

Our local CLEAResult team in Nashville has been working closely with TVA and the State of Tennessee through the Tennessee Department of Environment and Conservation (TDEC) since early 2023 to plan and strategize for implementing IRA funding. Together with TVA, we have completed draft applications for both the Home Efficiency Rebates and Home Electrification and Appliance Rebates programs. These drafts have been submitted for final review and approval by TDEC before being submitted to the Department of Energy (DOE).

What are the next steps?

While we wait for the DOE to approve the applications, we will continue to work closely with TVA and TDEC to ensure readiness for an anticipated launch in early 2025. This additional planning includes:

• Blueprint plan: A detailed implementation plan required by the DOE that outlines specific strategies for program implementation. This plan is due at least 60 days before the program launch.
• Technology buildout: Our program and the state already have tools to meet many of the needs of these programs, but we require further changes and integrations to ensure customers and contractors have the best experience and to help us track and report to the DOE.
• Stakeholder engagement and training: The success of these programs relies on a network of stakeholders, including contractors, community-based organizations, retailers and other partners. We’ve started engaging with these stakeholders to understand their priorities and to start training them on the details and processes they can expect when the IRA programs begin.

How does the program’s existing infrastructure complement the upcoming IRA implementation?

The IRA program delivery design in Tennessee was modeled after our existing programs, including Home Uplift, which focuses on income-qualified customers, and Residential Services, which is our market-rate program available to everyone.

These programs already have infrastructure and processes similar to those required by the new IRA programs. This includes a substantial contractor network to perform installations and income verification to identify qualifying participants. We also have the technology to help "stack" state funding with funding from our existing TVA programs, which will increase incentives for some customers.

With our local program team’s experience implementing Home Uplift and Residential Services, it's just a matter of educating all stakeholders on the primary differences in qualifications, processes and program standards to implement the IRA funding. We already have a training team in place to do just that. We will continue business as usual with these two programs through the IRA, leveraging our existing team members and rebates to maximize incentives for all Tennessee residents.

What unexpected challenges has your state encountered, and how are you addressing them?

The largest barrier is time. Multiple decision makers – including TVA, the state and federal government, and several consulting firms – need to collaborate and agree on every aspect of implementing these large-scale programs. Implementation teams need to understand that there might be a slower rate of acceptance and implementation from the state’s perspective due to competing priorities, contracts and public communication strategies.

What recommendations do you have for neighboring states planning to use IRA funding?

First, I’d recommend taking any opportunity to integrate IRA funding with existing energy efficiency programs to help improve the customer experience. That also prevents states from having to re-invent the wheel when it comes to program design and infrastructure. I also think it’s important to find a great implementation partner that understands the complexity of delivering programs like the IRA, and start planning as early as possible, since there will inevitably be unexpected roadblocks.

Check out the 2023 CLEAResult Energy Forum keynote panel featuring Mandy, TVA and TDEC to get more insight about the planning and collaboration process in Tennessee.