TVA brings back rebates for energy efficiency

Staff photo / James and Tonya McClellan look on as Mike Stewart, right, of Advantage Windows shows the McClellans energy-efficient windows in 2017 at the Riverbend Festival in Chattanooga. Vendors of all types lined the streets between performers.
Staff photo / James and Tonya McClellan look on as Mike Stewart, right, of Advantage Windows shows the McClellans energy-efficient windows in 2017 at the Riverbend Festival in Chattanooga. Vendors of all types lined the streets between performers.

Note: This story was updated Oct. 3 to correct the projected share of additional power TVA hopes to offset with its expanded energy efficiency program. 

Chattanooga businesses, residents and home builders can once again receive rebates from their electricity provider for investments made to cut power usage with measures such as buying more efficient heating and air conditioning units and better insulating ducts and windows.

The Tennessee Valley Authority announced Monday it is restoring the utility-wide incentives it eliminated five years ago for energy efficiency improvements as part of a $1.5 billion, four-year commitment from TVA for more energy efficiency.

EPB, the power distributor for TVA in Chattanooga, said the new rebates should help its customers lower electricity consumption and utility bills over time while also providing immediate rebates of up to $1,500 on new energy-efficient heat pumps, $300 for duct sealing and attic insulation, and $15 for each energy-efficient window replacement. Businesses may qualify for up to $1 million of rebates for qualified investments in energy efficiency and demand-response equipment.

"Reducing energy usage is the most effective way to lower monthly bills," Elizabeth Hammitt, director of residential energy and environmental solutions at EPB, said in an announcement of the new program Monday. "The EPB and TVA EnergyRight Home Energy Rebate program helps customers save money twice — first by applying rebates to the upgrades they make at home, and second by enjoying the energy savings that come with them for years to come."

By the numbers

— $1.5 billion: TVA investment in energy efficiency and demand management programs through fiscal 2027.

— 2,200 megawatts: Targeted reduction in TVA's peak load by 2027 from such incentives, or 30% of the projected power growth in the valley.

— $1,500: Rebate for a high-efficiency heat pump.

— $700: Rebate for an energy-efficient air conditioner.

— $300: Rebates for attic and wall insulation and envelope air sealing.

— $15: Rebate for each energy-efficient window replacement.

— $1 million: Maximum rebate payments per business for energy efficiency improvements.

Sources: EPB, TVA

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Monika Beckner, vice president of TVA energy services and programs, said TVA is encouraging its customers to be more energy efficient to help limit the future demand for additional TVA-generated electricity.

As cars, trucks and industries are electrified to replace fossil fuels and the Tennessee Valley continues to grow in coming decades, TVA projects its power demand could double by 2050. TVA hopes to offset 30% of its projected growth in electricity use by encouraging customers to install more energy-efficient machines, appliances and HVAC systems.

"We're seeing unprecedented load growth on our system coming out of the pandemic with the significant growth we've had in our population and industry," Beckner said by phone Monday. "We're adding more generation resources, but we also need to do more to incentivize our customers to use the energy we produce more efficiently."

TVA hopes its energy rebate program will generate enough power savings to offset the need to build at least two new power plants. As interest rates, construction costs and environmental standards increase, TVA Chief Financial Officer John Thomas projects the cost of building new power generation buildings will be more expensive than the cost of producing power from most of TVA's existing power stations.

"These rebates are a cost-effective way to reduce our megawatts and improve our carbon footprint in a way that helps our consumers and the overall Tennessee Valley economy," Beckner said.

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TVA was a pioneer a half-century ago in offering its customers incentives to make energy efficiency improvements, cutting monthly power bills for customers who installed cycle-and-save devices and helping finance purchases and installation of more energy-efficient heat pumps, furnaces and appliances. But over time, TVA limited its incentives on energy and efficiency as power demand stagnated.

Under former TVA President Bill Johnson, TVA restricted its direct rebates and incentives for customers to make energy efficiency improvements to low-income neighborhoods through its Home Uplift program.

A study earlier this year by the Southern Alliance for Clean Energy said last year TVA spent the least per capita of any major Southern utility on helping customers with energy efficiency, demand response and self-generated power from solar panels or windmills. As a result, the study found that spending on energy savings as a share of electricity bills in Tennessee and Alabama was less than 2% of the U.S. average.

"TVA used to be a leader in energy resource planning, but unfortunately, in 2019, TVA essentially eliminated treating energy efficiency as an energy resource and essentially ended all of their incentive programs," Forest Bradley Wright, the energy efficiency director for the alliance, said earlier this year.

The new TVA rebate program, which will be offered to all 153 of the local power companies that distribute TVA power, should help TVA move closer to other utilities in aiding customers to make what are often costly equipment and insulation upgrades to reduce power consumption.

Hammitt said EPB will continue to offer its free energy audits of homes and businesses from its Energy Pros, and starting this week such advice could come with rebate checks to those who install energy-efficient equipment using one of the TVA-approved contractors for the work. Customers can use more than one upgrade at a time, providing even more rebate savings on their investment, Hammitt said.

"We recommend customers start by visiting then schedule a call with our EPB Energy Pros to ensure they follow the procedure and get the most money back for their investment," EPB Senior Supervisor Energy Services John Watts said in a statement Monday. "As with all EPB Energy Pros services, these consultations are available at no charge to customers."

More information about TVA's new rebate program can be found at

Contact Dave Flessner at or 423-757-6340.

  photo  Staff photo / TVA EnergyRight Solutions Project Manager Elizabeth Moore speaks at James Mathis' home in 2018 in Chattanooga. Through EPB's Home Energy Upgrade program, Mathis's home was equipped with new insulation and a new HVAC unit to help make it more energy efficient.