Three cuts in 2026: 25C, HEAR and a third of Xcel's bonus
- December 31, 2025: the federal 25C credit ended. The One Big Beautiful Bill Act cut it short; it had been set to run through 2032.
- April 28, 2026: HEAR closed in the Front Range (Region 1) after its federal allocation was reserved.
- August 1, 2026: HEAR closed to new applications in the rest of Colorado.
- October 1, 2026: Xcel cut its cold-climate heat pump rebate from $2,250 to $1,500 per heating ton to stay within its approved budget.
One program was added: Power Ahead Colorado opened June 29, 2026. Every Colorado program, including local utility rebates, is in our Colorado heat pump rebates guide.
Three programs still pay: about $7,000 on a 3-ton heat pump
| Program | Amount | Who qualifies |
|---|---|---|
| Xcel Energy | $1,500 per heating ton | Xcel gas customers with a cold-climate heat pump |
| Power Ahead Colorado | $1,500, once per address | Existing homes in the 9 Denver metro (DRCOG) counties, no income limit |
| Colorado heat pump credit | $1,000, once per address | Any Colorado address that has not claimed it before |
All three come off the invoice, so you never file a tax form. Xcel electric customers without Xcel gas get the standard $750 per heating ton, with no bonus.
The Colorado credit is $1,000 for installs through 2028 and drops to $500 in 2029. Xcel pays per qualifying system; Power Ahead and the state credit pay once per address, ever.
What 25C and HEAR paid, and where to check a 2025 claim
25C was a federal tax credit of up to $2,000 a year on a heat pump, claimed on IRS Form 5695. Installs from 2023 through 2025 qualified; 2026 installs do not. Our federal tax credit page covers 2025 claims.
HEAR paid up to $8,000 on a heat pump for households at or below 150% of area median income, taken off the invoice. No new proposals are accepted anywhere in Colorado. Status is on our HEAR page.
What you pay now: $14,800 to $18,200 for a heat pump with a new furnace
These are our current out-of-pocket ranges for Xcel gas customers in the Denver metro, after the three rebates above. They are examples; your quote depends on equipment, size and ductwork.
| System | Out of pocket | Before rebates |
|---|---|---|
| Cold-climate heat pump + new gas furnace | $14,800 to $18,200 | $21,000 to $28,000 |
| Heat pump added to a furnace you keep | $10,500 to $14,000 | $17,500 to $24,000 |
| Furnace + AC (no heat pump rebates) | $12,800 to $16,200 | Same |
Going fully electric, with an air handler instead of a furnace, runs about $500 to $800 more. The rebates come to about $7,000 on a 3-ton system and $10,000 on a 5-ton. Before October 1, the Xcel line alone on 3 tons was $6,750, or $2,250 more; the October 1 change has the details. Line items for a full install are in our Denver heat pump cost breakdown.
No replacement announced, and Xcel payments may slip to 2027
No federal program has been announced to replace 25C. CLEAResult has said it will notify contractors if Front Range HEAR funding becomes available again.
On October 9, Xcel told contractors its 2026 heat pump rebate budget was nearly spent. Rebates filed after October 19 are paid starting January 2027, at the amount in effect when submitted.
We take the Xcel rebate off your invoice at install and wait for Xcel ourselves. If you file directly with Xcel, plan on a 2027 payment. The payment pause article lists what is and is not affected.
Quote checks after the 2026 changes
- 25C or HEAR on a new quote. Neither is available for a project starting now.
- Xcel at $2,250 per ton. That amount ended October 1. Current is $1,500 for gas customers.
- Power Ahead or the state credit on a house that already used them. Both pay once per address, so a prior owner's claim counts.
- Rebates listed but not deducted. Ask whether each program comes off the invoice or arrives later as a check, since Xcel checks may now arrive in 2027.
Uni applies Xcel, Power Ahead and the state credit on your invoice
Uni files Xcel, Power Ahead Colorado and the state credit for you, applies every program your address qualifies for, and installs Mitsubishi, Carrier and Bosch cold-climate systems.
