I am not sure about you but I have been hearing a lot about heat pumps lately. For the last few years, clients have been bringing them up as an energy efficient alternative to furnaces and ACs. Plus, Colorado and Xcel now have some attractive rebate programs (households qualify by income level) which are driving consumer interest and keeping costs down as homeowners replace older furnace and AC units. These rebate programs are available for owner occupied properties and investment properties, too.
So what is a heat pump? What are the pros and cons? And what rebates are available? Read on below for answers.
A heat pump is an all-in-one HVAC system that provides both heating and cooling. It uses electricity to transfer heat from cold spaces to warm spaces.
Rather than using combustion to heat air, a heat pump uses electricity and transfers heat from a cooler place to a warmer place- making the cool space cooler and the warm space warmer. While heat pumps have been ubiquitous in certain warmer areas of the country, they are becoming more common in colder areas now as heat pump technology has advanced.
Because heat pump systems use electricity, they are a more efficient system than forced air furnaces and ACs, electric baseboard heating, and propane.
So, what are the pros and cons of heat pump systems?
Pros:
-they are energy efficient and could lower monthly utility bills
-they reduce a home's carbon emissions
-they eliminate risks associated with combustion gases and carbon monoxide
Cons:
-they have a higher upfront installation cost. However, the upfront costs could be lowered significantly through state and other rebate programs
-older or lower end models can struggle to heat a home effectively in very low temperatures
What rebates and credits are available?
As of now, the state of Colorado and Xcel energy are offering rebates to encourage homeowners to replace older HVAC systems with heat pumps.
Here in our state, the Colorado Energy Office works with registered contractors to to issue rebates and discounts for certain projects like installing high efficiency appliances and whole home energy upgrades.
Qualified Coloradoans who own single family homes and small multi-family properties can access rebates through HEAR (Home Electrification and Appliance Rebates.) You can access their Frequently Asked Questions page here.
These rebate programs are available for owner occupied properties and investment properties too. Homeowners or tenants must qualify based on their income and different rebate programs and credits are available based on income level.
The state is offering tax credits and Xcel is offering rebates as well. A friend recently shared the bid she got to install a heat pump on her investment property. The tenants qualified based on their income. The initial price of the installation, permitting, and work was ~$20,000 but after taking into account all available tax credits and rebates, the project total will come to $3,300.
Homeowners can work with the state list of qualified contractors to access all available credits.
In my research, I came across these sources for further reading:
US Department of Energy- Heat Pump Systems
Wire Cutter- Heat Pump Buying Guide
Colorado Heat Pump Tax Credits
Colorado Home Energy Rebate Program
I haven't ever lived in a home with a heat pump but given these programs, I would consider installing one to give it a try. Have you ever lived with one? Or have your gone through the process of having one installed? I'd be curious to hear your experience with it.
Until next time!
Allison and Ken
