Energy Tax Credit Update: What Ended in 2026 and What SIP Projects Can Still Use

Updated October 2026.

If you're an architect, builder, or developer working with Structural Insulated Panels (SIPs), the federal energy tax credit picture has changed. The Reconciliation Bill signed in July 2025 (the "One Big Beautiful Bill") moved up the end dates for several energy-efficiency incentives, and the key deadlines have now passed.

Here's what ended, what still applies, and where to look for incentives on your next project.

Federal Credits That Have Ended

• Section 25D – Residential Clean Energy Credit
  Ended December 31, 2025. This credit covered solar, geothermal, and other renewable systems on homes.
  
  
• Section 45L – New Energy Efficient Home Credit
  Not available for homes acquired (sold or leased) after June 30, 2026. This credit provided $500 to $5,000 per qualifying single-family or multifamily unit and was widely used by SIP builders and developers.
  
  
• Section 179D – Energy Efficient Commercial Buildings Deduction
  Not available for buildings that begin construction after June 30, 2026. This deduction was worth up to $5.00 per square foot for commercial, multifamily, and public buildings.
  
  

Already in the pipeline? Homes acquired by June 30, 2026, or commercial projects that began construction by that date, may still qualify. Confirm eligibility and documentation with your tax advisor, and ask your Premier SIPS rep for any project records you need.

⇒ See the IRS summary of termination dates:  IRS Energy Credit FAQs

What Still Applies

State, local, and utility incentives

With the federal credits gone, regional programs are now the main source of incentives for energy-efficient construction. Many states, cities, and utilities offer rebates, credits, and financing for high-performance new homes and commercial buildings. Program types include:

• Utility new-construction programs that pay rebates or provide design assistance for buildings that beat energy code
• State incentives and tax programs for energy-efficient or above-code construction
• Energy-efficient financing, including green mortgage and loan programs for homebuyers and owners

Programs vary widely by location, so check what's available where you build.

⇒ Search programs by state:  DSIRE – Database of State Incentives for Renewables & Efficiency

Affordable multifamily housing

The same bill expanded the Low-Income Housing Tax Credit (LIHTC), increasing 9% credit allocations and lowering the private activity bond financing threshold from 50% to 25% beginning in 2026. Developers of affordable multifamily housing have more credit capacity available, and an efficient SIP envelope helps keep long-term operating costs low for owners and residents.

⇒ Read more in Builder Online's breakdown of the bill.

What This Means for SIP Builders and Designers

Federal credits were a bonus, not the reason to build with SIPs. The core value hasn't changed: faster dry-in, less jobsite waste, fewer callbacks, and lower energy bills for the life of the building.

To make the most of the incentives that remain:

• Check regional programs early, before design is locked, since many require pre-approval or energy modeling
  
  
• Design to the program's performance target, such as a specific percentage above code or a third-party certification
  
  
• Work with Premier SIPS early for R-value, assembly, and air-tightness documentation
  
  

Have questions about incentives for your project?  Contact your local Premier SIPS representative for guidance and support.

This article is for general information only. Please consult a tax professional about your specific project.