Last Updated on February 1, 2023 by Mary Pressler
Austin Energy Incentive Programs for Homes, Apartments and Businesses
Austin Energy is one of the largest municipal power companies in Texas, serving more than 520,000 customers in the Greater Austin metropolitan area. Founded in 1895, Austin Energy is also one of the oldest municipal utilities in the US.
- Austin Energy delivers over 13 billion kilowatt-hours per year, using 632 miles of transmission lines and 12,035 miles of distribution lines.
- The company generates over 70% of its electricity from carbon-free sources, and they have a 100% carbon-free generation target by 2040.
Austin Energy also manages an energy rebate and incentive program for its customers, which is divided into three subprograms: residential, multifamily and commercial.
Residential Energy Incentives from Austin Energy
Austin Energy’s residential incentives target three key areas: appliances and equipment, cooling and heating, and home improvements.
1) Appliance and Equipment Rebates
The appliances and equipment category covers two types of energy efficiency measures:
ENERGY STAR heat pump water heaters: Austin Energy gives you a rebate of up to $800 when installing a new hybrid electric water heater that meets the following requirements.
- ENERGY STAR Certified
- Energy Factor (EF) 2.0 or higher
- At least 40 gallons of capacity
- Main components covered by a six-year manufacturer warranty (or better)
This incentive is available for homes who have been Austin Energy customers for at least one year, and who have not received a water heater rebate for at least 10 years. The rebate can be used to replace a less efficient heat pump if the unit is at least 10 years old. A new heat pump can save you around $350 per year.
ENERGY STAR variable-speed pool pumps: These pool pumps can achieve 65% savings compared with traditional single-speed units, equivalent to around $450 in annual electric bills. Austin Energy offers a rebate of up to $300 when purchasing a variable-speed pool pump that meets the following conditions:
- ENERGY STAR Certified
- Must be installed by an approved contractor
- Pool must be located in your address
- Not available for pools with solar heating
Variable-speed pool pumps are more durable than fixed-speed pumps, since they can lower their speed instead of starting and stopping repeatedly. They also clean pool water more efficiently, while generating less noise. The incentive is available for new and existing pools.
2) Cooling and Heating Rebates
The cooling and heating category covers smart thermostats and three types of air conditioners: central split units, mini-splits and window-type units.
Power Partner Thermostats: Austin Energy offers a $30 rebate for customers who purchase a smart thermostat. Early adopters who enroll their thermostat in the Power Partner Program by January 31 also get a $130 power bill credit. Normally, the bill credit per smart thermostat is $85.
- Austin Energy uses the program to help manage grid demand, adjusting the temperature setting of participating thermostats by 2-4°C at times of high consumption.
- Smart thermostats participating in the program are adjusted remotely no more than three times per week and 25 times per year (up to five times per week during emergencies).
- The combined effect of multiple thermostats helps reduce the power grid workload.
Austin Energy provides a list of thermostats eligible for the incentive. Note that the benefit is not available for co-op and master-metered accounts. The incentive is available for both homeowners and renters, and each participant may register up to five smart thermostats.
Split-System Air Conditioners and Heat Pumps: Austin Energy customers who install new HVAC equipment may qualify for incentives, depending on the equipment capacity and efficiency rating. These incentives cover both central split systems and mini-splits, installed by participating contractors.
The following table summarizes the incentives for mini-split systems. In all three tiers, the incentive is reduced by 50% for mini-splits smaller than 18,000 BTU/h.
| Incentive Tier | Minimum Efficiency | Rebate Amount |
| Tier 1 | 15.2 SEER2 and 12.0 EER2 | $250 for air conditioners
$300 for heat pumps |
| Tier 2 | 16.0 SEER2 and 13.0 EER2 | $350 for air conditioners
$400 for heat pumps |
| Tier 3 | 18.0 SEER2 and 13.0 EER2 | $450 for air conditioners
$500 for heat pumps |
NOTE: SEER2 and EER2 refer to the updated SEER and EER ratings, determined according to the new testing procedure introduced by the US Department of Energy in January 2023.
The incentives for central split systems (AC and heat pump) depend on both system configuration and efficiency ratings:
| Incentive Tier | Minimum Efficiency | Rebate Amount, Conventional System | Rebate Amount, Inverter System |
| Tier 1 | 15.2 SEER2 and
12.0 EER2 |
$250 for air conditioners
$300 for heat pumps |
$150 for air conditioners
$200 for heat pumps |
| Tier 2 | 16.0 SEER2 and
13.0 EER2 |
$350 for air conditioners
$400 for heat pumps |
$350 for air conditioners
$400 for heat pumps |
| Tier 3 | 18.0 SEER2 and
13.0 EER2 |
$450 for air conditioners
$500 for heat pumps |
$550 for air conditioners
$600 for heat pumps |
To be eligible for the rebates in the table above, your HVAC installation project must meet the following conditions:
- Rebates are only available for replacing existing equipment (not for new constructions)
- Both your home and the equipment being replaced must be at least 10 years old
- New equipment rebates are not available if your existing equipment received rebates during the last 10 years.
- All existing components must be replaced: condenser, furnaces, air handlers, evaporative coils, etc.
- Air conditioning systems with electric resistance heaters are not eligible.
Window Air Conditioners: Austin Energy offers a $50 rebate for customers who replace their window AC with a more efficient ENERGY STAR Certified unit. ENERGY STAR window ACs can achieve up to 15% savings compared with standard models, and they have built-in timers for greater control and efficiency.
3) Home Improvement Rebates
Austin Energy participates in the Home Performance with ENERGY STAR Program, which offers whole-house incentives. They also provide solar screen rebates and weatherization assistance.
Home Performance with ENERGY STAR: Austin Energy offers both rebates and loans through this program. Rebates are determined based on the energy efficiency measures implemented, according to the following table:
| Energy Efficiency Measure | Rebate |
| Air infiltration reduction and duct sealing (mandatory measure for all projects) | $0.12 per square foot |
| Total external static pressure limit (mandatory measure for all projects) | $175 for the first system
$100 for additional systems |
| Duct replacement and insulation | $3.25 per linear foot of duct replacement
$1.00 per linear foot of existing duct insulation |
| Duct system performance improvement | $200 for the first system
$100 for each additional system $75 per new return air improvement, up to three per system |
| Upgrading attic insulation to R38 | $45 fixed fee plus variable incentive
$0.0035 x R-value increase x square footage For example, a 1,500 sq.ft. attic that increases its R-value from R22 to R38 would get $129. $45 + ($0.0035 x 16 x 1,500) = $129 |
| Fan covers | $25.00 per unit |
| Solar screen/film on single-pane windows | $1.00 per sq.ft., not available for new windows |
| External combustion air | $20.00 per unit |
| Insulated box for pull-down stairs | $25.00 per unit |
| Additional attic access | $25.00 per unit |
| Supply/return plenum improvement | $75.00 per unit |
| Eligible smart thermostats | $30.00 per unit |
| Supply grilles | $5.00 per unit |
| Return air grilles | $5.00 per unit |
| AC Tune-Up | $175.00 per unit, maximum five systems |
The Home Performance with ENERGY STAR also includes heating and cooling equipment rebates, which are higher than those available for stand-alone HVAC upgrades.
Rebates for Mini-Split AC and Heat Pump Systems:
| Incentive Tier | Minimum Efficiency | Rebate Amount |
| Tier 1 | 15.2 SEER2 and 12.0 EER2 | $550 for air conditioners
$600 for heat pumps |
| Tier 2 | 16.0 SEER2 and 13.0 EER2 | $650 for air conditioners
$700 for heat pumps |
| Tier 3 | 18.0 SEER2 and 13.0 EER2 | $750 for air conditioners
$800 for heat pumps |
*These rebates are reduced by 50% for mini-splits smaller than 18,000 BTU/hour.
Rebates for Central AC and Heat Pump Systems:
| Incentive Tier | Minimum Efficiency | Rebate Amount, Conventional System | Rebate Amount, Inverter System |
| Tier 1 | 15.2 SEER2 and
12.0 EER2 |
$550 for air conditioners
$600 for heat pumps |
$450 for air conditioners
$500 for heat pumps |
| Tier 2 | 16.0 SEER2 and
13.0 EER2 |
$650 for air conditioners
$700 for heat pumps |
$650 for air conditioners
$700 for heat pumps |
| Tier 3 | 18.0 SEER2 and
13.0 EER2 |
$750 for air conditioners
$800 for heat pumps |
$900 for air conditioners
$950 for heat pumps |
In addition to the rebates summarized in the tables above, you may also qualify for a $1,000 rebate from the Texas Gas Service.
The Home Performance with ENERGY STAR Program also offers residential energy efficiency loans ranging from $1,500 up to $20,000. Loans up to $5,000 are classified as Tier 1, with a repayment period of up to 60 months. Larger loans up to $20,000 are classified as Tier 2, and their repayment period is up to 120 months. Applicants may qualify for 0% interest rate if they meet two conditions:
- Meeting the Austin Energy 15-point potential energy savings criteria
- Minimum credit score of 600.
Austin Energy is offering bonus incentives for energy efficiency projects submitted before April 15, 2023. Rebate-only projects can qualify for a $600 bonus incentive, while rebate+loan projects can qualify for 0% interest rate. In addition, the following bonuses are available in both cases:
- $50 for solar screens
- $100 bonus rebate for air conditioner replacements
- $50 bonus rebate for AC tune-up
You can expect to save around 20% in summer power bills after a Home Performance with ENERGY STAR project. To be eligible for the program, your home must be at least 10 years old and qualify for at least $100 in rebates. Also note that existing HVAC that contain asbestos are not eligible. Renters can participate if they have written authorization from their landlord.
Solar screen rebates: Austin Energy offers an incentive of $1.00 per square foot when installing solar screen fabric. To qualify, you must submit manufacturer specifications showing that the Solar Heat Gain Coefficient (SHGC) is no more than 0.40.
Solar screens can block up to 70% of the sun’s heating effect, lowering your indoor temperature by up to 15°F. They also reduce ultraviolet radiation, which has a damaging effect on furniture and other surfaces. Solar screens also help prevent glare.
Weatherization assistance rebates: Austin Energy offers no-cost weatherization for households with an income level not exceeding 80% of the area median income. This benefit is available for single-family, duplex, triplex, fourplex and mobile homes that are at least 10 years old. The following are some energy efficiency measures covered by the weatherization assistance program:
- Attic insulation
- Ductwork repairs and sealing
- Air sealing: walls, ceilings, doors
- Solar screens
- LED lighting
- Reflective roof coating
- Smart thermostats
The program also offers free carbon monoxide and smoke detectors, which make indoor spaces safer. Austin Energy customers who qualify for weatherization assistance can also get rebates and 0% financing to purchase a new air conditioner.
Homes who participated in the Weatherization Assistance or Home Improvement with ENERGY STAR programs during the last 10 years are not eligible. In addition, your home area cannot exceed 2,500 square feet and its improvement value cannot exceed $437,000 (excluding land).
Multifamily Energy Incentives from Austin Energy
Austin Energy manages a separate incentive program for multifamily residential buildings, which don’t qualify for the incentives described in the previous section. These energy incentives are classified into five categories:
- Cycle Saver water heater timers
- Cooling and heating
- Lighting
- New construction
- Property improvements
There are standard incentives for multifamily buildings, and additional incentives for affordable housing and other income-eligible properties. Austin Energy has introduced a 20% bonus beyond normal incentive levels for all projects completed before December 31, 2023.
1) Cycle Saver Water Heater Timers
Multifamily properties who use water heater timers installed by Austin Energy are eligible for free replacements and periodic inspections. This incentive program has the goal of reducing peak demand during summer, activating the timers during the following schedule:
- June 1 – September 30
- Monday – Friday, excluding holidays
- 3:00 PM to 7:00 PM
Free timer replacements are available for fully electric water heaters with a capacity of at least 30 gallons. Building owners who agree to use timers on all their electric water heaters also get a $25 bonus for each unit installed by Austin Energy.
2) Multifamily Cooling and Heating Rebates
Austin Energy offers incentives for energy efficiency measures that improve air conditioning and space heating efficiency in multifamily properties. These incentives cover equipment upgrades, HVAC tune-up services, ductwork improvements and smart thermostats. The following table summarizes the incentive rates for each type of measure:
| HVAC Efficiency Measure | Incentive |
| Air conditioner and heat pump replacements | $230/ton (14.5 – 14.9 SEER)
$250/ton (15 – 15.9 SEER) $285/ton (16 – 16.9 SEER) $290/ton (17 SEER or higher) |
| HVAC tune-up | $240/unit (standard incentive)
$300/unit (income-qualified properties) |
| Air duct sealing and remediation
(upflow and stud-mounted units) |
$50/ton (standard incentive)
$60/ton (projects with at least three measures) $75/ton (income-qualified properties) |
| Plenum redesign and remediation
(uncased fan coils) |
$245/plenum (standard incentive)
$280/plenum (projects with at least three measures) $350/plenum (income-qualified properties) |
| Power Partner thermostats | $150/unit |
To qualify for the incentives above, HVAC equipment must meet the minimum IECC and city code requirements. You must submit AHRI certificates for the proposed equipment, and any systems that use gas-fired heating must have carbon dioxide and smoke monitors. AC tune-ups are available for 5-15 year old units that are in good operating condition but no longer covered by manufacturer warranties, with a cooling capacity of up to 65,000 BTU/hour.
Air duct sealing projects have the goal of reducing leakage to no more than 15%, while plenum redesign projects have a target of no more than 20%. All new ducts used in these projects must have at least R-8 insulation. These incentives are available for properties where the duct leakage is currently 25% or higher (30% or higher in systems with uncased fan coils).
3) LED Lighting Rebates for Multifamily Properties
Upgrading to LED lighting is one of the most cost-effective energy saving measures, and these projects are also covered by the Austin Energy incentive program:
| Type of LED Lamp | Incentive |
| Type A bulb | $2.50/lamp (standard incentive)
$3.00/lamp (income-qualified properties) |
| Candelabra | $4.00/lamp (standard incentive)
$5.00/lamp (income-qualified properties) |
| Spot or floodlight | $5.00/lamp (standard incentive)
$6.00/lamp (income-qualified properties) |
| LED tube – linear fluorescent replacement | $5.00/lamp (standard incentive)
$6.00/lamp (income-qualified properties) |
The incentive program has performance requirements for each type of LED lamp:
- Type A bulbs = Maximum 10W, must save at least 45W
- Candelabra = Maximum 7W, must save at least 33W
- Spot/floodlight = Maximum 16W, must save at least 40W
- LED tube = Maximum 12W, must save at least 20W
These incentives are only available for indoor lighting upgrades. All new light bulbs must be ENERGY STAR, UL Listed and covered by at least a 25,000-hour manufacturer warranty.
4) New Construction Rebates – Integrated Modeling Incentive
Austin Energy has an incentive for new construction and major renovation projects where the owner uses energy modeling to demonstrate demand savings during summer. The incentive rate is normally $175 per kilowatt during the following schedule:
- June 1 – September 30
- 2:00 PM – 8:00 PM
This incentive program is not available as of 2023. When this program has been active, the maximum rebate has been $300,000 per building per fiscal year. The incentive has been offered for new constructions and major renovations with an area of at least 10,000 square feet. The program has covered the multifamily, commercial and government sectors.
5) Property Improvement Rebates
Austin Energy offers rebates for existing property improvements such as attic insulation, solar screens, window replacements and water saving fixtures. Incentives are also available for property owners who have not completed an Energy Conservation and Audit Disclosure (ECAD) during the last 10 years.
| Type of Property Improvement | Incentive |
| Attic insulation | Up to $0.71/sq.ft. (standard incentive)
Up to $0.89/sq.ft. (projects with at least three measures) Up to $1.19/sq.ft. (income-qualified properties) |
| Solar screen or film | $2.20/sq.ft. (standard incentive)
$2.75/sq.ft. (income-qualified properties) |
| Window replacement | $2.20/sq.ft. (standard incentive)
$2.75/sq.ft. (income-qualified properties) |
| Water saving devices | $400.00/kW (standard incentive)
$500.00/kW (projects with at least three measures) $600.00/kW (income-qualified properties) |
| ECAD | $2,500 per property |
The attic insulation incentive is calculated based on the difference between the existing insulation level and the new insulation. Austin Energy provides a rebate table that can be used to determine the applicable incentive per square foot. This incentive is available for multifamily buildings at least 10 years old, with an insulation level of R-22 or less. The upgrade must achieve at least R-30 and fully cover the attic floor space.
Solar screens/films must have an SHGC of 0.30 or less, and low-e windows must have an SHGC of 0.25 or less. The incentive is not available for windows that are permanently shaded, or facing north and northeast.
Austin requires building owners to submit an Energy Conservation and Audit Disclosure (ECAD) at 10-year intervals, and multifamily buildings must be compliant to qualify for incentives. However, Austin Energy also offers a rebate to complete an ECAD audit if necessary.
Commercial Energy Incentives from Austin Energy
Austin Energy’s commercial incentives are very similar to those available for multifamily buildings, covering the following categories:
- Appliances and equipment
- Cooling and heating
- Lighting
- Load management
- New construction
- Property improvements
Commercial building owners are also eligible for bonus incentives in 2023. Austin Energy is offering a 30% bonus up to a maximum amount of $10,000, and the total rebate can cover up to 95% of project costs.
1) Appliances and Equipment
Commercial buildings who are Austin Energy customers can qualify for a wide range of equipment rebates, which are summarized in the following table:
| Equipment Type | Rebate | Additional Information |
| Commercial kitchen equipment | Varies depending on the type of equipment | All new kitchen equipment must be ENERGY STAR Certified, with the exception of spray valves. |
| Electronically commutated motors (ECM) | $350 per kilowatt saved | You cannot use the replaced motors in Austin Energy’s service territory. |
| Heat pump water heaters | $800 per unit | ENERGY STAR heat pump water heaters with at least 40 gallons of capacity and 2.0 Energy Factor (EF). |
| Plug load occupancy sensors | $25 per device | Passive infrared or ultrasonic sensors controlling at least 50W of plug loads in offices, cubicles or classrooms. |
| Transformers | $300 per kilowatt saved | Submit Transformer Performance Data according to NEMA TP-1-2002. |
| Uninterruptible power supply (UPS) | $300 per kilowatt saved | The new UPS unit must exceed the baseline efficiency set by Austin Energy at 50% load. |
| Variable frequency drives (VFD) | $400 per kilowatt saved
$50 bonus may be available for installing CEE Tier 2 motors at the same time |
Savings achieved by VFDs in HVAC systems are calculated based on summer design conditions.
Incentive not available for VFDs required by the Austin Energy Code |
| Custom projects | $350 per kW saved by equipment
$200 per kW saved by process improvements |
Austin Energy will establish a baseline considering local code requirements, efficiency of similar equipment, and other technical criteria depending on project-specific conditions. |
*Incentive applications for retrofits and equipment replacement must be submitted before the installation. Applications for new constructions must be submitted before the Certificate of Occupancy is issued. All commercial buildings must be compliant with ECAD audits to qualify for energy efficiency incentives.
2) Commercial Cooling and Heating Rebates
Austin Energy offers rebates for a wide range of HVAC improvements in commercial buildings, which are covered in the following table:
| HVAC Measure | Rebate | Additional Information |
| HVAC replacement | Varies depending on the type of HVAC unit, tonnage and efficiency | Equipment types covered include:
-Packaged ACs and heat pumps -Split ACs and heat pumps -Ductless mini-splits -Variable refrigerant flow (VRF) -Packaged terminal ACs / heat pumps -Window-type ACs Must meet AHRI standards. |
| HVAC tune-up | Based on unit capacity:
-$228 if less than 5 ton -$260 for 5-9.9 ton -$325 for 10-14.9 ton -$455 for 15-19.9 ton -$650 for 20-25 ton |
Eligible equipment includes packaged and split units up to 25 tons, in good operating condition and 3-15 years old.
The same unit cannot receive another HVAC tune-up rebate in three years. |
| Chillers | Varies depending on the type of chiller, tonnage and efficiency | Available for air-cooled, water-cooled centrifugal and water-cooled displacement chillers. The new unit must meet AHRI standards. |
| Cooling towers | $300 per kilowatt saved | Must submit manufacturer ratings according to Cooling Technology Institute (CTI) standards and warranty information. |
| Energy recovery ventilators (ERV) | $300 per kilowatt saved | Must submit manufacturer ratings according to AHRI standards. |
| Guest room controllers | $50 per device | Controller must be UL Listed, must raise temperature at least 3°F during summer and lower temperature at least 3°F during winter. |
| Smart thermostats | $30 per device | Choose a smart thermostat from Austin Energy’s approved list. |
| Thermal energy storage | $350 per kilowatt shifted off-peak
Up to $12,000 incentive for a feasibility study if the anticipated demand shift is greater than 100 kW |
The commercial facility must shift 20-50% of demand or 1,000 kW, whichever is less.
Austin Energy will install an interval data recording meter. |
3) Lighting Rebates
LED lighting upgrades have a low cost and short payback compared with many energy efficiency measures. Austin Energy offers incentives for lighting retrofits and controls in existing buildings, and energy efficient lighting in new constructions.
| Type of Lighting Project | Rebate | Additional Information |
| Lighting retrofit | $420 per kilowatt saved | All equipment must be approved by UL, CSA or similar laboratories.
LED lighting products must be ENERGY STAR Certified or DLC Qualified. |
| Lighting controls | $225 per kilowatt saved | Occupancy sensors and daylight sensing controls. |
| New construction | $105-$370 per kilowatt saved, depending on percentage savings from baseline | Only lighting components that exceed code are eligible, and you must submit a lighting ComCheck. |
| Small business lighting retrofit | $795 per kilowatt saved | Available for Austin Energy customers using Secondary Voltage Rate 1 (<10 kW) or Rate 2 (10-300 kW). |
The new construction lighting rebate is calculated based on percentage savings with respect to the energy code baseline. Parking garages and warehouses get $105/kW if their lighting savings are less than 60%, and $210/kW if savings exceed 60%. All other buildings qualify for:
- $105/kW if lighting savings are below 20%
- $210/kW if lighting savings are 20-40%
- $370/kW if lighting savings exceed 40%
4) Load Management Rebates
Austin Energy offers an incentive for commercial electricity users who are capable of reducing their power consumption at times of high demand. They have two versions of the program: standard demand response and fast demand response.
| Program | Standard Demand Response | Fast Demand Response |
| Incentive | $45 per kilowatt reduced | $55 per kilowatt reduced |
| Response time | 1-hour notice | 10-minute notice |
| Automated demand response (ADR) | Optional | Mandatory |
*In both versions of the program, demand response events have a duration of 2 hours and a schedule of 4:00PM – 7:00PM, from June 1 to September 30. Demand reduction will be required around 15 times per annual period, up to a maximum of 20 times.
Commercial demand response participants can earn up to $66,000 per year.
5) New Construction Rebates
Austin Energy offers incentives for new construction projects. These incentives are available for complete build-outs, core and shell projects, commercial fitouts, additions and renovations. The new construction rebates offered by Austin Energy are nearly identical to the existing building rebates, but there are two important differences:
- Lighting rebates have a different incentive table in new constructions (covered above).
- Building envelope rebates are not available for new constructions.
Austin Energy has also offered the Integrated Modeling Incentive Program for new constructions in the past. The program offers $175/kW if you use energy modeling software to demonstrate savings during the peak summer schedule (June 1 – September 30, from 2:00 PM – 7:00 PM). Unfortunately, this program is not active in 2023.
6) Property Improvement Rebates
The Austin Energy commercial incentive program also covers property improvements such as ceiling insulation, roof insulation, reflective roof coating, window treatments and window replacement. Austin Energy also has a small business version of the Home Performance with ENERGY STAR Program.
The following table summarizes the incentive rates available for building envelope measures:
| Energy Efficiency Measures | Rebate | Additional Information |
| Roof and ceiling insulation | $0.20 per square foot | Available for buildings with an existing insulation level of R-15 or less. |
| Spray-on / paint-on reflective roof coating | $0.15 per square foot | You must submit ASTM test results verifying 75% reflectivity. |
| Window treatments | $1.00 per square foot if SHGC* is 0.37 or less.
$0.60 per square foot if SHGC is 0.38-0.50 |
Not available for windows facing North or Northeast, or windows shaded more than 50% between June and September. |
| New windows | $1.00 per square foot if SHGC is 0.27 or less | Same conditions as the window treatment rebate. |
*SHGC = Solar heat gain coefficient
The Home Performance with ENERGY STAR Program is designed for the residential sector, but it also applies for small businesses and nonprofit organizations that are currently operating in a converted house.
The small business version of this program has the same incentive rates as the residential version. However, the small-business program does not offer loans (only rebates).
Visit the Austin Energy website for more information on their incentive programs.