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Incentives and Financing

Energy efficiency upgrades and new heating and cooling systems are major financial investments in your home or building, but they are good investments, reducing your energy usage and keeping you and your family more comfortable.

These incentives are for single family homes, or 2-4 family in some occasions. Further incentives and programs for larger multifamily, nonprofit and commercial properties can be found on 

Explore Your Options

Start Here: Improving Home Performance

No matter what you heat your home with, improving your home’s performance by better insulation and reducing drafts will make you more comfortable and save you money on heating and cooling. Some incentive programs for heat pumps also require you to meet certain levels of insulation in the house first, so improving your energy efficiency now will make your home ready for heat pumps in the future. 

There are incentives for all income levels! Choose your household size (and county for single households) to see qualifying income levels for EmPower+ or Comfort Home. These programs focus on improving energy efficiency, health, and safety of a home, and can sometimes provide funding for heat pumps as well. 

Skip to details on each program:

Utility Rebates for Heat Pumps

Utility Rebates for Heat Pumps

Rebates are available from New York State utilities for installation of heat pump systems and equipment. These are good for all building types (residential, commercial, multifamily, nonprofit, industrial, etc.), all current fuel types, and both new construction and renovation/retrofitting. Rebates are based on the heating load/capacity of a building, so incentives are better for equipment that heats most efficiently at cold temperatures. All paperwork, including the application form, is typically completed by your installer, and all HeatSmart CNY approved installers qualify.

Building Heating Rebates

These incentive tables are for National Grid and NYSEG territories. Visit CleanHeatNY for rebates in other areas.

System Type Heating Capacity Rebate
Ground Source / Geothermal Heat Pump < 300,000 BTUH $1,500 per 10,000 BTUH
Cold Climate Air Source Heat Pump 90-120% ("full load") of heating load < 300,000 BTUH $1,000 per 10,000 BTUH
Cold Climate Air Source Heat Pump 90-120% ("full load") of heating load < 300,000 BTUH with integrated controls $1,200 per 10,000 BTUH (Starting Sept 1, 2022)
Cold Climate Air Source Heat Pump 90-120% ("full load") of heating load < 300,000 BTUH with fossil fuel system completely removed ("decommissioned") $1,400 per 10,000 BTUH (Starting Sept 1, 2022)
Cold Climate Air Source Heat Pump <90% of heating load $500 per outdoor unit (partial load)
Geothermal, air source, or VRF > 300,000 (large buildings) Custom incentive: $80 per MMBTU energy savings, or $100,000 per MMBTU for projects that include building envelope improvements

Water Heating Rebates

System Type Capacity Rebate
Air Source Heat Pump Water Heater < 120 gallons $700 per unit
Air Source Heat Pump Water Heater > 120 gallons (commercial) $80 per MMBTU annual energy savings
Ground Source Heat Pump Water Heater N/A $900 per unit
Ground Source Heat Pump Desuperheater N/A $100 per unit
BONUS for Cold Climate Air Source: Heat Pump + Water Heater installation N/A $250

NYSEG/RG&E customers can have their own plumbers and/or electricians do the installation if preferred, and apply for the rebate themselves.

Tax Incentives

Federal Tax Credits & Rebates

The 2022 Inflation Reduction Act provides unprecedented funding to help people improve their homes, energy efficiency, and health while helping to address climate change. 

Significant tax rebates and credits are included. We are covering the most applicable programs here. 

Disclaimer:  We are not tax professionals. The information on this website is intended for guidance only. There are particular standards and details that must be met; please consult with a tax professional.  

IRS FAQ Documents:

Other resources:

Residential Clean Energy Tax Credit for Geothermal, Solar, and Battery Storage

The Inflation Reduction Act of 2022 has bumped the federal Residential Clean Energy Property Credit tax credit for geothermal heating, solar panels, and battery storage, etc. back up to 30% for the next 10 years, until 2033. This is retroactive to any project installed in 2022 Consult with a tax professional to determine how much this incentive may be for you; not all households are able to take the full 30%, it is limited by the amount of tax you owe.

Existing homes and new construction qualify.  Both principal residences and second homes qualify. Rentals do not qualify. 

Energy Efficient Home Improvement Credit

Eligible measures include energy-efficient insulation, windows, doors, and similar energy-saving improvements, certain biomass stoves and boilers, electric panels and related equipment, and home energy audits.  

  • 30% tax credit 
  • Annual Limits:
    •  $1200 general annual limit (Spend $4000 to max this out each year)
      • $150 for home energy audits;
      • $250 for an exterior door ($500 total for all exterior doors);
      • $600 for exterior windows and skylights; central air conditioners; electric panels and certain related equipment; natural gas, propane, or oil water heaters; natural gas, propane, or oil furnaces or hot water boilers; and
    • $2,000 annual limit for electric or natural gas heat pump water heaters, electric or natural gas heat pumps, and biomass stoves and boilers.
  • Generally, all measures must be Energy Star rated where applicable. Please read the IRS FAQ for further details on eligible measures.
  • For eligible home improvements after 2024, no credit will be allowed unless the manufacturer of any purchased item creates a product identification number for the item, and the person claiming the credit includes the number on his or her tax return.


New York State Tax Credits

In 2022, the New York State Legislature passed a new geothermal state tax credit of 25% of the project cost, up to $5000. 

The New York solar equipment tax credit can reduce your state tax payments by up to $5,000 or 25% off your total solar energy expenses (whichever is lower). Both Federal and New York solar credits can be carried forward. 

For eligibility and information specific to your situation, consult your tax preparer.

Property Tax Exemption

Property tax exemptions exist for residential energy efficiency upgrades including heat pumps.


With proper financing, households on oil, propane, and resistance electric can realize significant out-of-pocket savings on their annual energy costs from day one. Your HeatSmart CNY installer will help you apply for the loans that apply to your project. 

Green Jobs Green New York Loans

New York State offers two loans for energy efficiency (including heat pumps) and renewable energy projects through their Green Jobs Green New York program:

  • On-Bill Recovery includes the cost of the upgrades right on your energy bill and requires a cost-effectiveness test to be passed. This can be passed on to the next homeowner if it is not paid off by the time you sell your home. Your monthly payments will not exceed your estimated average monthly energy cost savings.
  • Smart Energy loans is a traditional loan that is paid back through monthly payments. Lower interest rates are accessed through enrolling in autopay.

Geographic-based eligibility for reduced GJGNY interest rates: If you live in one of the census blocks pictured below, you can qualify for reduced interest rates without having to prove your income.  This makes it easier for self-employed individuals or others with hard-to-document incomes to access these reduced interest rates. Interest rates as low as 3.49% are available for census areas based on average income; enter your address here to see if you qualifies.

Those with credit scores of 780 or above do not have to meet cost-effectiveness or debt-to-income ratio tests and income documentation is not required (unless applying for under lower income interest rates). Financing is still available for credit scores down to 540.

EnerBank USA

Many installers offer financing options through EnerBank USA. The GeoSmart loan finances up to $85,000 with terms up to 20 years at 4.99%. They also offer a 12-month 0% interest same-as-cash loan to cover the amount of the expected federal tax credit.

Home HeadQuarters Green CNY Loan

Home HeadQuarters provides up to $20,000 with terms of 7-10 years at 5.24% in Green CNY loans.

Other Resources

Home Performance


EmPower+ helps low- and moderate-income households save energy and money toward energy improvements made to their property.

Through EmPower+:

  • Households can receive a no cost comprehensive home energy assessment to pinpoint where energy and dollars are being wasted and receive a customized plan to lower energy usage.
  • No-cost direct install improvements identified during the assessment can be installed by participating program contractors.
  • Households can receive financial discounts on the cost of energy efficiency improvements.

The program is open to income-eligible owners and renters of 1-4 family households.

Whether you own your home or rent, we will connect you with a participating contractor to assess if your home would benefit from free energy upgrades such as:

  • Home energy assessment to identify areas of possible energy improvements
  • Tips on how to save energy
  • Installation of high-efficiency lighting
  • Attic and wall insulation
  • Installation of clean heating and cooling heat pumps
  • Replacement of old, inefficient refrigerators and freezers
  • Water-saving showerheads
  • A monthly electric bill credit of between $5-$15 from community solar.

You can choose one of these three ways to apply:

Frequently Asked Questions (FAQs):

What happened to Assisted Home Performance for moderate income customers? It is now part of EmPower+!

Does it cost? 

It depends on income level or location. If the household is low-income, or someone in the home receives SNAP or HEAP, or it is located in a geo-eligible area, the household can have $10,000 worth of energy efficiency improvements completed for no cost to them. Through Sept. 15th if they received HEAP or SNAP in the past year there is an additional $10K available towards electrification. If they are moderate income (60-80% of AMI and not in a geo-eligible area) it is a 50% cost share – they pay up to $5000 and NYS will match it. There is an additional $4K to $6K available to these households for heat pumps.  There are 3.5% interest loans available for costs not covered by the EmPower+ program. People can choose whether or not to do additional work.  

Is this a loan? It is a grant.

Will this mess with my HEAP grant next year?

  • The funding goes to the contractor, so it does not increase the household’s reportable income or thereby jeopardize other benefits.
  • The only case where it may affect the HEAP grant is for a household who is switching from oil or propane to fully heat with heat pumps, but the cost savings from the heat pumps will more than make up for the decrease in the HEAP benefit. However, if someone regularly relies on all 2-3 emergency HEAP benefits to get through the winter, the decreased benefit may outweigh the financial benefit of the heat pump. Careful evaluation is needed in these cases.
  • Gas and electric heating receives the same HEAP benefit so no change would happen in that case.

What are the requirements to receive this?

  • Must be the one responsible for the energy bills.
  • Must work with a NYSERDA-approved EmPower+ contractor
  • Income / geo-eligibility
  • The amount of the funding and the work to be completed depends on the home itself.
  • Renters must have landlord approval
  • 1-4 unit buildings.
  • Etc.  Enroll with us to explore your options and what is available to you!

Is this for homeowners only?

No, renters may apply. It is only for 1-4 unit buildings however and there are limited things a contractor can do without a landlord’s approval. We can help you work with your landlord.

Does it cost my landlord?

Only if they choose to install recommended improvements that exceed the grant amount, or more than half of the units in the property are moderate-income rather than low income, at which point the landlord must provide matching funds.

Will I need to provide tax information?

Income documentation will need to be provided ONLY IF the household is not categorically eligible or geo-eligible.

    • Categorical eligibility requires a copy of entire award letter for HEAP, SNAP (Food Stamps), TANF (Temporary Assistance for Needy Families) or Supplemental Security Income dated within the past 12 months. No further income documentation is needed.
    • Geo-eligibility means the address of the property (single-family only for now) falls within the areas in blue on this map:


Weatherization Assistance Program

This program assists income-eligible families (below 60% of state median income, same as Empower), reducing their heating and cooling costs through energy efficiency. Most of these providers have other home improvement funds as well, but also have a waiting list. We recommend applying for both WAP and Empower New York; you may go through both programs. Empower New York will be able to help sooner, and WAP can complete any improvements not covered by Empower. 

Comfort Home

For homeowners with incomes above 80% AMI, NYSERDA’s Comfort Home program provides incentives of $1000-$4000 for improving a home’s energy efficiency through a qualified contractor. Learn more here. 

Finger Lakes Climate Fund

This rebate is available on a per-case basis through installers. It provides homeowners throughout the Finger Lakes and Central New York areas with up to $2,500 to encourage heat pump and insulation installations. Funding comes from local carbon offset contributions. Help contribute to projects in the CNY area! Offset your carbon emissions and pick the CNY team.  Colgate University’s team also contributes to projects in our area!  

Inflation Reduction Act

These programs from the 2022 federal Inflation Reduction Act will be implemented by states and are currently under development. Our best guess is to see them implemented in mid-to-late 2023. Based on the IRA, these are broad outlines of what we may expect:

High-Efficiency Electric Home Rebate Program 

A point-of-sale program to provide rebates to low- and middle-income families who purchase energy-efficient electric appliances. To qualify for a rebate, your family’s total annual income must be less than 150% of the median income where you live. Families below 80% of AMI will get the full rebate; 80-150% AMI will get 50% rebates.

Qualifying homeowners can get rebates as high as:

  • $840 for a stove, cooktop, range, oven, or heat pump clothes dryer;
  • $1,750 for a heat pump water heater; and
  • $8,000 for a heat pump for space heating or cooling.

Rebates for non-appliance upgrades will also be available up to the following amounts:

  • $1,600 for insulation, air sealing, and ventilation;
  • $2,500 for electric wiring; and
  • $4,000 for an electric load service center upgrade.

HOMES Rebate Program

The HOMES (Home Owner Managing Energy Savings) Rebate Program will get you cash back by shrinking your overall home energy use through weatherization renovations, like adding insulation, or by installing more efficient appliances, like heat pump clothes dryers. The amount you can get back depends on how much energy you’ve saved, how you prove those energy savings (through either modeling, which requires computer software, or measured energy savings), and your household income. Save more energy, get more cash. Plus, low- and moderate-income households qualify for double the rebate amount and are eligible for up to 80 percent of project costs. That’s $8,000 max if you cut energy use by 35 percent and $4,000 max if you cut energy use by 20 percent. (Source: NRDC 2022) 

We do our best to keep this page updated with the latest information. This page was last modified on January 23, 2023.