Heat Pump Rebates

By Anne Fonda

If you’re in the market for a new air source heat pump system, be sure you know about the variety of heat pump rebates available to help offset the cost. There are federal rebates for heat pumps provided for in the Inflation Reduction Act (IRA) of 2022, as well as rebates from some manufacturers and utility companies.

Let’s break it down.

The home electrification and appliance rebates (HEAR) program is also known as the High-Efficiency Electric Home Rebate Act (HEEHRA) by some states. It’s one of the federal rebate programs covered in the IRA. The federal government approved funding for all of the states that applied. States will administer this program.

The HEAR program is recommended for households that have an income that is average or below average in their area. This rebate program prioritizes helping low-income or middle-income households that make less than 150% of the average median income (AMI) for their area. 

Don’t automatically think you don’t qualify because of the “low and moderate-income” phrasing. In some parts of the country, 150% of AMI is more than $140,000. 

This program provides eligible households with up to $14,000 in rebates for those upgrading from non-heat pump HVAC systems. It covers up to 100% of costs for lower-income families and up to 50% for moderate-income families.

The Consortium for Energy Efficiency (CEE) sets standards that heat pumps must meet to determine eligibility for the rebates. Qualified electric ducted heat pumps and ductless mini-splits are eligible for the largest rebates, at up to $8,000. There are additional rebates for upgrading an electric panel and adding insulation, among other things.

These are point-of-sale rebates, meaning rebate money goes directly to the state-qualified heat pump installer, electrician, or other vendor.  You do not receive a lump sum payment from the state.

The home energy rebate program is also a federal rebate program that is administered by the states. Home energy rebates are available to homeowners and renters at any income level and apply to energy-efficient home improvements that reduce energy consumption. The HOMES rebate program is recommended when you’re “taking a comprehensive set of actions to reduce your energy usage.”

These upgrades can include:

Before starting your upgrades, get a home energy audit to see where to make improvements. Qualifying home improvement products must meet or exceed program efficiency requirements.

You can save up to $8,000 depending on the project’s energy savings, as verified by approved modeling software. Your project will need to reduce your home’s energy usage by 20% for smaller incentives. Savings of 35% lead to the highest incentive of $8,000.

Check your state’s energy department website to see if your state is participating in these programs yet. Active programs may have a calculator for you to see what rebates you might qualify for. If the program isn’t active yet, you can sign up for email updates.

A full list is below. States without a link either did not apply for funding or do not have a rebates website.

You may wish to consult a tax advisor before filing your taxes for the year in which the installation takes place.

Many utility companies across the United States offer heat pump rebates for energy-efficient systems. It’s up to each company what to offer, if anything. You can go to your energy provider’s website to look at what’s available. They may offer rebates on other energy-efficient appliances, as well.

These are rebates that an HVAC manufacturer may offer on select high-efficiency heat pumps. Frequently, these offers are available in the fall and the spring, so if you don’t see this rebate offer on a website, ask your dealer about it. If you can wait a few months, you might be able to save several hundred dollars more.

Your local American Standard dealer can help you take advantage of multiple financial incentives when you purchase a new heat pump system. Our Savings and Offers tool does the work for you.

Anne Fonda, Content Writer

A Content Writer with Trane Technologies, Anne Fonda researches topics and writes for Trane® and associated residential HVAC brands. She works in collaboration with Trane Technologies subject matter experts, offering easy-to-understand, informative content on complex topics. Her goal is to help consumers make informed decisions on the products and services they need. 

She has written for HVAC and other service provider websites for over 16 years. Before transitioning to web content writing, Anne had a 14-year stint as an award-winning journalist. She graduated cum laude from the University of Missouri-Columbia School of Journalism. When she’s not working, Anne enjoys playing word games, reading, gardening, spending time with family, and visiting gardens and museums.

Expert review by Josef Hejda, Electrification Commercialization Leader