Policy
Congress
Updated: August, 2021
The role of Congress was relatively limited for residential wood heating until 2020 when wood heating appliances were included under Section 25D of the Internal Revenue Code, giving a 26% tax credit on wood and pellet heaters that are at least 75% efficient and installed before Dec. 31, 2022. After that, the credit goes down to 22% through Dec. 31, 2023.
Tax credits for wood residential wood heaters in the United States began in 2005, expired in 2007, and was restarted in 2009 at $1,500, dropped to $300 in 2010 and stayed at that level off, and on, through the end of 2020. For more details on this lower tax credit that Congress periodically offered to wood and pellet heaters, click here. For an analysis on the current, far larger tax credit, click here.
Many bills have been introduced to gain more parity between thermal biomass and other renewables over the past 5 years. Residential solar and geothermal have enjoyed a federal 30% tax credit for many years, but efforts to extend this to wood and pellet heating have not been successful. The Biomass Thermal Energy Council (BTEC) has been a leader in pushing these bills and an overview of the bills can be found on their website.
​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 2015.
Members of Congress also can put pressure on federal agencies to focus more on residential wood heating. Senator Shaheen (D-NH) work 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.