How a Trump presidency could impact the HVAC industry

Editor’s note: We’ll write a similar piece on the Democratic candidate once officially nominated.

It’s anyone’s guess what’ll happen come election time in November, but there’s an elephant-sized question in the room:

• If former President Trump wins the election, how will HVAC-related policies be impacted?

What’s happening: Trump has made it clear that the Inflation Reduction Act (IRA) — including the $8.8 billion Home Energy Rebates programs — will be put under a microscope if he wins.

Catch up: Two programs, HOMES and HEAR, offer rebates for energy-efficiency upgrades, funded by the Department of Energy (DOE). 

• Each state is managing its own programs. 

• As of August 1, New York is the only state with a live program, eight others have been approved, and twelve more have submitted applications. 

“If we look at the Home Energy Rebates, any changes will depend on where the $8 billion that has been allocated is,” HVAC-industry lobbyist Alex Ayers tells Homepros. 

• “If it’s in the state’s hands, there isn’t much Congress can do to get it back, but if it’s still at [the] DOE, the Trump Administration can choose not to transfer the funds,” he says.

• Funds are obligated to states once approved, so state applications are expected to increase in the coming months.

• “The race is on for the Biden administration to get money out the door,” Politico adds. 

Of note: Some parts of the IRA would likely see the chopping block before the Home Energy Rebates.

• “The electric vehicle tax credit, I think it’s going to be probably the number one most vulnerable component of the IRA,” a former Trump administration official said. 

EPA impact: Trump could also target the Environmental Protection Agency (EPA), raising questions about the AIM Act — which he signed in 2020 to phase down the use of HFCs, including R-410A.

• It’d be hard to drastically alter the AIM Act at this point, Homepros is told. But, certain dates could be changed. 

• “If a Trump EPA tries to delay any of the technology transitions, we will very likely see states acting on their own, which will create confusion… and a patchwork of transition dates,” Ayers notes. 

• “It is far better for our industry to keep the existing transition plan in place instead of states adopting last-minute changes.” 

Workforce: In 2019, the Trump administration’s Department of Labor (DOL) introduced a rule, allowing third parties to create Industry-Recognized Apprenticeship Programs (IRAPs) alongside the traditional Registered Apprenticeship system.

• The construction industry was excluded, which HVAC-industry groups supported, noting that IRAPs prioritize task-oriented training over developing the holistic skillsets needed in trades.

• The rule took effect in 2020 but was scrapped by the Biden administration in 2022 to refocus on Registered Apprenticeships.

During a second Trump term, however, the rule could be reintroduced, potentially reigniting conversations about the construction industry’s exclusion. 

• “We’re in no position to weigh in on whether IRAPs are appropriate in other industries, but if DOL reintroduces the rule under a second Trump administration, we’d like to make sure that the building trades are excluded again,” PHCC’s Mark Valentini tells Homepros. 

Taxes: There’s talk about shortening certain tax credits, including Section 25C, which offers up to $3,200 for energy-efficient home improvements and was extended by the IRA through 2032, to pay for extending the Trump administration’s 2017 tax cuts.

• Refresh: Those cuts lowered the corporate tax rate to 21% but partly expire after 2025.

• “Congress and the White House are going to be looking at every part of the tax law… and making more reforms while also trying to extend as much of it as possible,” Ayers says.

• “[S]everal tax incentives like Section 25C have been discussed as possible pay-fors for extending tax changes,” he adds. 

Yes, but: All of this, of course, depends not only on whether Trump’s in the White House, but also on which parties hold majorities in Congress. 

The bottom line: The election’s a toss-up for now, but some changes are likely if Trump wins a second term.