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Colorado’s HEAR rebates for single-family homes are closed, but two incentives are still open in 2026: the state heat pump tax credit, which registered contractors pass on as an upfront discount (at least $333 off an air-source heat pump), and Xcel Energy’s heat pump rebates for its customers, which require a contractor from its Trade Partner Network.
HEAR and HOMES in Colorado
HEAR and HOMES are the federal rebate programs that replaced most of the help from the expired heat pump tax credit. Each state runs its own version. How HEAR and HOMES work nationwide.
| Program | Status | Details |
|---|---|---|
| HEAR (electrification rebates) | Closed | HEAR single-family program closed in Region 1 (Front Range) and Region 2 (all other counties); rebates for small multifamily buildings expected in 2026 (update of August 2026) (source) |
| HOMES (whole-home efficiency rebates) | Not launched yet | Colorado’s HOMES program (HER) is planned for manufactured/mobile homes and large multifamily buildings in 2026 (source) |
Heat pump rebates and incentives in Colorado
| Program | Amount | Who qualifies | Key requirements |
|---|---|---|---|
| Colorado heat pump tax credit (upfront contractor discount) Open (source) | 2026 installs: air-source credit $1,000 (you get at least $333 off); ground-, water- or combined-source $2,000 (at least $667 off); heat pump water heater $250 (at least $83 off) | Anyone installing in Colorado | Use a state-registered contractor, who claims the credit and must show the discount on your invoice as "State of Colorado Heat Pump Discount". ENERGY STAR certified; air-source systems must be AHRI-matched; space-heating systems must be designed to meet at least 80% of annual heating needs. No paperwork for you |
| Colorado HEAR (single-family) Closed: Closed for single-family homes in both regions (August 2026 update) (source) | Was up to $8,000 for a cold-climate heat pump and up to $3,000 for a standard heat pump (max $14,000 per household) | Below 150% of county AMI | Registered contractor and a formal reservation notice before work |
| Xcel Energy heat pump rebates Open (source) | Varies by equipment; Xcel asks you to confirm the amount with your contractor. Check current amounts with Xcel Energy | Xcel electric and/or gas customers in Colorado; income-qualified customers may get up to the full cost covered | Use a contractor from Xcel’s Trade Partner Network (DIY is allowed for non-ducted mini-splits). Install and invoice by December 31, 2026; apply by September 30, 2027. From October 1, 2026, homes heated with Xcel natural gas may get an extra bonus |
Example: what a typical household could get
Example: a Denver-area household installs a cold-climate air-source heat pump in 2026 through a state-registered contractor. The state credit is $1,000, and the contractor must pass at least a third of it, $333, to the household as a discount on the invoice (it can pass on more). If the household is an Xcel customer and the contractor is also in Xcel’s Trade Partner Network, it may qualify for an Xcel rebate too. Xcel doesn’t publish a fixed amount, so ask for it in writing on the quote, and ask about the bonus for homes heated with Xcel natural gas that started October 1, 2026.
How to apply, step by step
- Find a registered contractor on the Colorado Energy Office’s list. Only registered contractors can give you the state heat pump discount. If you’re an Xcel customer, check that the contractor is also in Xcel’s Trade Partner Network.
- Confirm the equipment qualifies: ENERGY STAR certified, an AHRI-matched system for air-source heat pumps, and sized to meet at least 80% of your home’s annual heating needs.
- Get a written quote showing the “State of Colorado Heat Pump Discount” line and any Xcel rebate.
- Install on time. For Xcel’s 2026 rebates, installation and invoicing must be done by December 31, 2026, and applications are accepted through September 30, 2027. Your contractor usually submits it; DIY mini-split installs apply online.
- Income-qualified? Ask Xcel about its income-qualified program, which may cover up to the full cost of a heat pump.
Choosing a heat pump for Colorado’s climate
Colorado’s cold nights and high-altitude winters favor cold-climate heat pumps. Xcel describes these as operating efficiently down to -5°F. Colorado’s HEAR program paid far more for them (up to $8,000) than for standard heat pumps (up to $3,000).
The state credit also has a sizing rule that matters in a cold climate: space-heating heat pumps must be designed to meet at least 80% of your home’s annual heating needs. A small unit that leaves the furnace doing most of the work won’t qualify.
Colorado heat pump rebate FAQ
Is Colorado’s HEAR rebate still open?
Not for single-family homes. The Colorado Energy Office closed the HEAR single-family program in both regions, and applications for Region 2 submitted after August 1, 2026 are denied. Rebates for small multifamily buildings are expected in 2026.
How does the Colorado heat pump tax credit work?
A state-registered contractor claims the tax credit and must give you at least a third of it as a discount on your invoice. For 2026 installs, that’s at least $333 off an air-source heat pump, $667 off a ground-, water-, or combined-source system, and $83 off a heat pump water heater.
Do I need to file anything to get the Colorado discount?
No. The contractor claims the credit with the Department of Revenue. Just make sure the discount appears on your invoice.
What happened to the $1,500 Colorado credit?
That was the 2024–2025 amount for air-source heat pumps. For systems installed on or after January 1, 2026, the credit is $1,000, and it’s scheduled to drop again in tax year 2029.
Can I install a mini-split myself and still get an Xcel rebate?
Yes. Xcel allows DIY installation for non-ducted (mini-split) heat pumps and has a separate online application for them. Other types need a Trade Partner Network contractor.
Rebates in nearby states
Sources
- Colorado Energy Office: Colorado Home Energy Rebate Program
- Colorado Energy Office: Colorado Heat Pump Tax Credits
- Xcel Energy Colorado: Heat pumps
Programs change often. We verify every figure against the official source listed above; if something looks out of date, let us know.