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A new $1,500 rebate to spur homes and businesses to install energy-saving heat pumps to cut building air emissions is being offered by the Denver Regional Council of Governments
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Power Ahead Colorado,, is offering the rebates for an energy efficient, cold-climate heat pump, which can replace both a home’s furnace and air conditioning.
The $40 million, four-year initiative is part of Power Ahead Colorado’s goal reduce air emissions from the building sector. The program received $200 million in federal funds.
“Buildings are the largest source of climate pollution in the Denver region,” said Robert Spotts, manager of the program. “The way we reduce that pollution is by making our buildings all electric and more efficient.”
Power Ahead Colorado is also offering free energy advisers — available by phone or email — for homeowners and businesses to answer questions about home electrification, heat pumps and energy savings.
“We really want to be a resource to guide people through this major investment,” Spotts said.
Homeowners and businesses in the nine-county Denver metro region who replace an existing furnace or air-conditioning unit or install a new heat pump are eligible. Multifamily units are also eligible.
Households in Adams, Arapahoe, Denver, Boulder, Jefferson, Broomfield, Gilpin, Clear Creek and a portion of Weld counties can file for rebates.
Cold-climate heat pumps use advanced technology to operate efficiently even at temperatures below zero.
An air-source heat pump uses a refrigerant with a low boiling point, as much as 55 degrees below zero, to gather heat in the air even on a cold day and then runs the vaporized refrigerant through a compressor concentrating the heat and sending it into the house.
To be eligible for the Power Ahead Colorado credit the units also must be Energy Star-rated and installed by a verified Power Ahead Colorado contractor.
Heat pumps can range from $15,000 to $30,000 depending on the system and the size of the house and the $1,500 Power Ahead Colorado rebate can be added to other heat pump rebates.
Xcel Energy, for example, offers rebates ranging from $300 to $750. A bonus is available through 2026 that brings the rebate up to as much as $2,250.
“We’re excited to see Power Ahead Colorado launch a heat pump rebate that, when combined with Xcel Energy rebates and others, helps make upgrading to a heat pump more affordable,” Emmett Romine, an Xcel Energy vice president, said in a statement.
Other utilities, including the Platte River Power Authority and the Tri-State Generation and Transmission Association, also have rebate programs. The state also offers a $1,000 heat pump tax credit.
However, the biggest rebate program, the federally funded Home Electrification and Appliance Rebates, or HEAR, program, administered by the Colorado Energy Office, closed to Front Range applicants in April.
Under HEAR, income-qualified households could get up to $8,000 in federal rebates, plus $4,000 for electrical panel upgrades.
“With the HEAR rebates gone, the Power Ahead Colorado is more relevant, more important,” said Neil Kolwey, the industrial program director at the nonprofit Southwest Energy Efficiency Project. “Still, the loss of the HEAR rebates shouldn’t have a big effect; there is a lot of momentum in the market and still a reasonable amount of money in rebates.”
In 2025, the number of heat pumps installed in the service areas of five major Colorado utilities more than doubled to 14,225, marking a twelvefold increase in three years.
Power Ahead Colorado is developing an additional $50 million program to provide home energy upgrades and heat pumps, free of charge, to 1,600 low-income households, Spotts said.
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