Policy
Congress
Updated: July 2025
The role of Congress in residential wood heating has been limited, but Congress as included tax credits in 2005, initially at 10% up to $300. The credit has lapsed many times, and often it was extended for one year at a time. The credit was included in section 25C, the residential energy efficiency section of the tax code up until 2021 when it was moved to section 25D, the renewable energy section. In 2023 it was moved back to 25C, and increased to 30% up to $2,000 and extended through 2032.
In July 2025, Congress voted to rescind section 25C as of Dec. 31, 2025, setting the stage for another short, long or permanent end to tax credits for wood heaters. Stay up to date on the status of the tax credit on our Federal Tax Incentives page.
Many bills have been introduced to gain more parity between thermal biomass and other renewables over the years and to extend the credit to biomass heating systems for institutions and commercial property.
​Congress did set the stage for federal regulation of wood and pellet equipment by passing the Clean Air Act in 1970. Section 111 of the Clean Air Act (42 U.S.C. 7411) gives the EPA authority to regulate particulates and other pollutants from wood and pellet stoves and boilers. In 1988, the EPA implemented a New Source Performance Standard (NSPS) for wood heaters. This standard was updated in 2015.
Congress did set the stage for federal regulation of wood and pellet equipment by passing the Clean Air Act in 1970. Section 111 of the Clean Air Act (42 U.S.C. 7411) gives the EPA authority to regulate particulates and other pollutants from wood and pellet stoves and boilers. In 1988, the EPA implemented a New Source Performance Standard (NSPS) for wood heaters. This standard was updated in 2020.
Recently introduced legislation concerning wood heating and wood products include the 2023 Community Wood Facilities Assistance Act, the Firewood Banks Act of 2022 (not enacted), and the 2021 Biomass Thermal Utilization Act (not enacted). Two energy acts introduced in 2021, the Clean Energy Innovation and Deployment Act (not enacted) and the American Energy Efficiency Act (not enacted), included combined heat and power systems that uses qualified renewable biomass ("closed-loop biomass"). The Community Wood Facilities Assistance Act is still active in the 118th Congress, currently having been referred to the Committee on Agriculture, Nutrition, and Forestry.
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Members of Congress also can put pressure on federal agencies to focus more on residential wood heating. Senator Shaheen (D-NH) with the Energy Information Agency led that Agency to expand its reporting on wood heat. And, Senator Collins (R-ME) worked with the federal Department of Housing and Urban Development to change guidelines to allow FHA-insured homes to use wood pellet heating systems as a conventional heating source.