Because home performance and electrification services save energy, there are federal, state, and local utility incentives available to encourage more homeowners to invest in improving the energy efficiency of their home. These incentives, often in the form of rebates or tax credits, can make installing a new heat pump, mechanical ventilation, or scheduling an energy audit more affordable.
Kevel Home Performance can help you review available incentives and find the combination that saves you the most. In many cases, you can save $3,000 or more in a single year on heat pump installation and other upgrades. We’re often able to handle all of the rebate paperwork for you, too!
Inflation Reduction Act Energy Audit and Heat Pump Tax Credits
As part of the 2022 Inflation Reduction Act, the Energy Efficient Home Improvement Tax Credit (which is an update of an earlier 25C tax credit) allows homeowners to claim a 30% federal tax credit for qualifying energy efficiency upgrades, including:
- Ducted heat pump and ductless mini-split installation—30% with a $2,000 cap
- Electrical panel upgrades—30% with a $600 cap
- High-efficiency air conditioners, furnaces, and boilers—30% with a $600 cap
- Energy audits—30% with a $150 cap
Homeowners claim their tax credit when they file their tax returns for the year or period when they made the qualifying upgrade. So if you installed a heat pump in 2023, you would fill out Form 5695 when it was time to file (likely in early 2024) and deduct your credit from the federal taxes you owe.
Learn more details about current and forthcoming Inflation Reduction Act incentives here.
Tech CLEAN California Heat Pump Instant Rebates
This state-wide incentive offers an instant rebate of up to $1,000 per unit on new heat pump upgrades, with a $2,000 maximum per household. This includes both ducted heat pumps and ductless mini splits. You must be upgrading from a non-heat pump system to a heat pump, and you have to work with a Tech CLEAN-enrolled contractor like Kevel Home Performance to qualify.
Tech CLEAN rebates are “instant”, which means that Kevel Home Performance will simply reduce the amount you qualify for from your bill. We even take care of all the paperwork, making this incentive one of the easiest and simplest!
BayREN Heat Pump Rebates
The Bay Area Regional Energy Network offers rebates on ducted heat pump or ductless mini split installation.
- Upgrading from an existing central natural gas furnace and air conditioner: $400 rebate
- Upgrading from an electric heating system or heat pump: $250 rebate
You must work with a BayREN Participating Contractor like Kevel Home Performance to qualify. This isn’t an instant rebate, but we will still handle all of the paperwork for you!
Stacking Rebates and Tax Credits for Maximum Savings
The best part about having multiple incentive options is that you don’t have to choose between them. In many instances, you can combine incentives, like tax credits and Tech CLEAN rebates, to lower your upfront investment in a new heat pump even further.
The team at Kevel Home Performance has more than 30 years of experience in home performance services and helping San Francisco homeowners upgrade their homes. We are a qualified contractor for many major incentive programs and have the experience to help you navigate the sometimes confusing landscape of incentives. Since 2011, we’ve been helping Bay Area families not only make their homes more comfortable and healthy but make upgrading more affordable too!
