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Heat pumps are a much debated topic in today’s society. While they have a wide range of benefits, their effectiveness and supply chain issues can concern homeowners.
As a result, the federal government has released new tax-related incentives and rebates for heat pump units for homeowners.
As most of the United States and Colorado are starting to look for environmentally-friendly and renewable options for power and electricity, heat pumps are becoming far more energy-saving. Today, many heat pump models are even reducing carbon emissions!
So, to help improve the environment, the government is releasing a series of new federal rebates for heat pump units in 2023. We’ve gathered what you need to know in this article and also answered a few key questions that you might have. If you have any other questions or if you want to get a heat pump installed, you can contact our team at IMS Heating & Air.
If you’ve recently invested in a home (and the necessary systems that come along with it), rebates might be a new thing for you. Simply put, rebates are a type of incentive program or a monetary reward that the person buying a good can get. Rebates can also refer to any money you get back after paying a certain amount.
When referring to tax rebates, the definition can be extended to include any money – or refunds – you get after a tax decrease or change. With environmental issues coming to the forefront in today’s society, certain aspects of these tax-based incentives can show up as federal heat pump rebates.
As mentioned, heat pumps are environmentally-friendly alternatives to furnaces and most other heating systems. Since heat pumps allow both heating and cooling through one system, you end up saving far more on your energy bills in a year. Additionally, since heat pumps don’t burn fuel to create their heat, far fewer emissions – like CO2 and other similar gasses – are released.
Like other heaters and air conditioners, though, heat pumps draw or release the heat in one of three different ways. Air source heat pumps are the most common due to the fact they use the air for heat, and can be far more readily installed. If you’re interested in air source heat pumps, just contact us at IMS Heating & Air to schedule an appointment.
Other kinds of heat pumps include geothermal systems that draw in and release heat through the ground and water source heat pumps which do the same through a nearby well or body of water. These heat sources, incidentally, coincide with the amount of money returned to you.
With the new models being created and better technology being put into heat pumps to make them even more effective and eco-friendly, many more rebates for heat pump units are being released in 2023. Depending on your home’s location and the type of heat pump, you can end up saving hundreds to thousands of dollars.
Additionally, the Colorado government is releasing a new sales tax exemption and a tax credit in 2023. Together, the credit and exemption can help add a discount of up to 12.9% on the heat pump’s initial cost.
These heat pumps rely on the air around your home holding some heat but are still can be used in the winter months quite effectively. Of course, this means that there are few air source heat pump incentives as well.
In areas with milder winters, the federal rebate you can get is about $1,000 to $2,500. Some heat pump brands and companies do also offer cold climate models, though. Much like mini-split systems, these kinds of heat pumps have a greater heating capability and similarly can get homeowners a rebate ranging from $1,500 to $3,500.
This changes, though, depending on your local energy company or who supplies your home with power. Different energy companies might have different offers and calculations when it comes to rebates, with some having a range depending on the equipment costs.
If you’re with the energy company, your rebates can fall between $675 to $6,000, depending on the equipment costs. Working with a good company like IMS can help somewhat reduce the installation cost of a new, high quality heat pump, earning you about 50% of the system’s price. And, if the air source heat pump is a cold climate model, you can get an additional $1,000 per heating ton.
While they are essentially the same as the other varieties, these mini split heat pumps tend to differ through the fact they are (usually) ductless. In the place of the ducts and vents that run through your home, small air handling units push air out once it’s been heated. This allows you to pick which rooms need the units. The result is that mini split heat pumps can earn you about $1,500 in rebates.
While geothermal heat pumps also have rebates, a few factors need to be considered before you can look into rebates. One such example is the heat pump’s previous heat source. Primary gas heat sources have rebates offered at $400 per heating ton while electric resistance heat sources have $300 per ton. Both types of rebates for heat pump units have an added $500 bonus as well!
Though they are one of the main kinds of heat pumps, water source models are only now offered rebates. This may likely be because having access to a steady supply of water is far more limited than the other types, and creating a man-made well just for a single heat pump is expensive. However, in 2023, new rebates are being offered for a total of 10% of the system’s buying price.
Of course, this is only one factor in the wide range that can influence the possible federal rebates you can get. The income of your household can add a bonus while investing in whole-house heat pumps can get the bonus even higher. These mentioned rebates are only based on the type of heat pump, so make sure to check with your Colorado energy company for more specific information about your pump’s specific model.
If you want to invest in a new heat pump, just contact our team at IMS Heating & Air for help!
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