It’s no secret in the building community that federal tax incentives for energy efficient homes and buildings have been weak, inconsistent and outdated for quite some time. So much so that many had given up on them.

But that could be changing this year. With a more urgent approach to climate change, Democrats led by President Joe Biden appear committed to passing strong clean energy provisions as part of an infrastructure/climate package. Tax incentives encouraging the adoption of green technologies are among the top priorities, with support from both sides of the aisle.

Among the leading candidates for updates are three energy efficiency tax incentives for homes and buildings: the Sec. 179D incentive for commercial buildings, the Sec. 45L incentive for new home construction, and the Sec. 25C incentive for efficiency improvements to existing homes.

All three of the tax breaks currently have low incentive levels and outdated energy performance criteria, making them not terribly exciting to green buildings professionals. They also have repeatedly expired in recent years, only to be reinstated after extended periods of uncertainty.

Now, both Congress and the administration are actively exploring how to best improve them as part of the ongoing infrastructure negotiations, including with significantly higher incentives for high-performance structures such as zero energy ready. That work is a top policy priority at USGBC.

The Senate Finance Committee, for example, led by Chairman Ron Wyden (D-Ore.), has proposed the Clean Energy for America Act that would boost the Sec. 179D deduction to a new sliding scale system with deductions of $2.50 to $5 per square foot for new buildings based on how much they outperform the latest ASHRAE standard 90.1 for commercial buildings. At the high end, that’s more than double the current deduction of $1.80 per square foot. For retrofits, buildings demonstrating both a threshold score and a significant improvement over their before-construction energy intensity with ENERGY STAR Portfolio Manager would be eligible for similar incentives.