The 2026 Incentives Guide: What Survived, What Pays, What's Urgent
The One Big Beautiful Bill Act rewrote clean-energy incentives. Here's the post-cleanup map — amounts, deadlines, and exactly what to do this year.
By the GetVRF editorial team · Updated July 11, 2026 · 14 min read · Figures verified July 2026
The landscape in 60 seconds
On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) compressed a decade of Inflation Reduction Act incentives into a two-year sprint. As of July 2026:
- Gone: the residential 25C credit (30%, up to $2,000/yr for heat pumps) and 25D credit (30% of home solar) — both expired for property placed in service after December 31, 2025.
- Alive with a clock: the commercial solar investment tax credit (§48E) at 30% — but most projects starting now must be placed in service by December 31, 2027. The begin-construction safe-harbor window closed July 4, 2026.
- Just sunset: the §179D efficient-commercial-building deduction (up to $5.81/ft²) ended for projects whose construction began after June 30, 2026 — projects already underway can still claim it.
- Still strong: state and utility money. EmPOWER Maryland pays ~$500/ton for commercial VRF; DC SRECs trade at $367.50/MWh; Virginia kept full-retail net metering in its April 2026 SCC ruling.
The strategic takeaway: the federal center of gravity moved from tax credits to state/utility programs and SREC markets — which happen to be strongest in exactly the MD/DC/VA corridor. And for commercial solar, the calendar is now part of the engineering.
Federal: what's actually left in 2026
For homeowners
No federal tax credit for heat pumps or solar installed in 2026. Two things partially fill the gap: IRA Home Energy Rebates (HOMES/HEAR) — Maryland was allocated ≈$137M, but as of mid-2026 applications haven't opened, so treat it as upside rather than plan around it — and state/utility programs below. Homeowners can also access solar economics through third-party ownership (lease/PPA), where the owner-operator may still monetize commercial credits.
For businesses and nonprofits
| Program | Value | 2026 rules that matter |
|---|---|---|
| §48E solar ITC | 30% of solar system cost | Projects that began construction by 7/4/2026 keep extended timelines; new starts generally must be in service by 12/31/2027. FEOC (foreign-entity) sourcing rules apply to 2026+ starts. Direct pay available for tax-exempt owners. |
| MACRS / bonus depreciation | Often ~15–20% of solar cost in tax value | 5-year MACRS on solar; 100% bonus depreciation restored by OBBBA. Stacks with the ITC (basis reduced by half the credit). |
| §179D deduction | Up to $5.81/ft² | Terminated for construction beginning after 6/30/2026. If your project broke ground before that date — including VRF-driven HVAC efficiency scope — claim it. |
| VRF equipment itself | No federal credit | Commercial VRF value now comes from utility rebates, 179D (legacy projects), and operating savings. |
Maryland
The strongest all-around stack in the region: high retail rates (≈22.1¢ residential / 16.4¢ commercial in 2026 — up sharply since 2024), mature EmPOWER programs, and a functioning SREC market.
| Program | Who | Value (2026) |
|---|---|---|
| EmPOWER midstream HVAC rebates (BGE, Pepco, Delmarva, SMECO, PE) | Residential | ≈$1,300–$1,700 per cold-climate/standard heat pump; $800 ductless; instant at distributor |
| Whole-home electrification (HPwES) | Residential | Up to $15,000 or 75% of cost for qualifying electrification projects |
| EmPOWER business programs | Commercial | ≈$500/ton for VRF heat pumps (Pepco C&I sheet; BGE comparable). Pre-approval required before purchase |
| SRECs | Any solar owner | ≈$55/MWh — a 60 kW commercial array earns ≈$4,300/yr |
| Solar Access Program (MEA) | Low/moderate-income residential | $750/kW grant, up to $7,500; first-come, first-served |
| Tax treatment + net metering | All | No sales tax on solar (~6% saved); property-tax exemptions in many counties; full-retail net metering with annual reconciliation |
Washington, DC
DC is the SREC capital of America. At $367.50 per MWh (Flett Exchange, July 2026), a DC solar array earns roughly 1.5–2× more from SRECs than from the electricity itself at retail. Combined with 23–25¢ rates, DC solar-VRF projects post the fastest paybacks we model — our 30,000 ft² electric-resistance office scenario clears in under 4 years.
- DCSEU residential electrification rebates: published rebates for qualifying heat pumps and panel work; substantially higher for income-qualified households (Solar for All / Affordable Home Electrification pathways).
- DCSEU commercial HVAC: listed ASHP rebates ($375–$700 per unit; $500–$650 for large units) plus a custom incentive track that's the right door for VRF — capped at $100,000 per site per fiscal year, pre-approval mandatory. No new rebates for gas equipment in market-rate buildings.
- Net metering: full retail; system sizes generous relative to load.
Virginia
Cheaper power (≈17.4¢ res / 10.3¢ com) means solar payback runs longer — but three 2025–26 developments moved VA up our board:
- Net metering defended: the SCC's April 2026 ruling on Dominion's NEM 2.0 kept full-retail crediting, and APCo's proposed ~70% export-rate cut was rejected in 2025.
- SRECs poised to rise: currently ~$27–$33/MWh, but 2026 legislation raising the in-state solar carve-out from 1% to 4.5% is widely expected to push prices materially higher within 18 months.
- Commercial financing: statewide C-PACE availability funds VRF + solar retrofits with long-term, transferable financing tied to the property; residential systems ≤25 kW get an automatic property-tax exemption.
For oil- and resistance-heated Virginia buildings, the VRF conversion alone (before any solar) is frequently the best-performing line item in our model — the warehouse scenario shows ~$20k/yr savings on fuel switch alone.
Your 2026 action timeline
| When | If you're commercial | If you're residential |
|---|---|---|
| Now – Sept 2026 | Screen the project (calculator → feasibility). File utility pre-approvals before buying equipment. Lock solar EPC pricing with in-service-by-2027 milestones in the contract. | Get EmPOWER/DCSEU rebate quotes in writing; join the HEAR/HOMES notification lists. |
| Q4 2026 | Sign; order long-lead VRF equipment (R-454B transition is stretching some lead times). | Install heat pump ahead of winter; capture midstream rebates at purchase. |
| 2027 | Construction + interconnection with buffer — in service by Dec 31, 2027 protects the 30% ITC. | Add solar when HEAR/HOMES opens or TPO pricing beats cash. |
Which of these apply to your building?
The calculator line-items every program above for your exact scenario.
Sources
- IRS / Congress.gov — 25C & 25D expiration under OBBBA (P.L. 119-21); Form 7205 instructions (179D)
- The Tax Adviser & Clean Energy Help — §48E safe-harbor and placed-in-service analysis (2026)
- DOE — 179D program page; NTG Advantage — 179D sunset ($5.81/ft², June 30, 2026)
- Pepco Maryland C&I Technical Sheet (HVAC incentives, 2026 program year); Home Energy Basics — EmPOWER MD rebate summary
- DCSEU — commercial HVAC & residential electrification rebate pages (FY2026)
- Flett Exchange — DC SREC market prices (July 2026); EnergySage — MD solar incentives; Virtue Solar — VA incentives & SCC NEM 2.0 ruling
- Electric Choice / EIA — state average retail electricity prices (July 2026)
- DSIRE — authoritative database for programs outside MD/DC/VA
Program values change and many require pre-approval. Verify with administrators and a tax professional before committing capital. Last full verification: July 11, 2026.