What heat pump rebates pay in Denver
We re-read the state tax credit page, the Colorado Energy Office rebate page and the Power Ahead Colorado page on October 5, 2026. Xcel's own page loads by script and would not open for us, so Xcel's amounts come from its 2026 rebate summary, which lists them as starting October 1, 2026. Each card names its source at the bottom of the page.
Xcel cold-climate heat pump
Counted at 5°F, for Xcel Energy electric or gas customers using a participating contractor. A unit that gives 3 tons of heat at 5°F earns $2,250.
Xcel bonus for gas-heated homes
The same unit would earn $4,500. The bonus is for homes heated with Xcel natural gas. Electric baseboard homes get the standard amount.
Power Ahead Colorado
For an ENERGY STAR cold-climate air-source heat pump in an existing building, installed by a verified contractor who gets your project approved before work starts. Denver is inside the program area.
State heat pump discount
The state credit is $1,000 for an air-source heat pump, and the contractor must pass at least one third to you as a line on the invoice. Many contractors pass on more.
State income-based rebates (HEAR)
Up to $8,000 for a cold-climate heat pump while open. The single-family program is now closed, so do not plan around it.
City of Denver homeowner rebate
Denver's homeowner page now points to a group-buy program and to the programs above. It lists no city rebate amount, so we show none.
Federal tax credit (25C)
Ended for spending after December 31, 2025.
Working it out
Take a 3-ton cold-climate system in a Denver home heated with Xcel gas. Xcel at the bonus rate: 3 x $1,500 = $4,500. Power Ahead Colorado: $1,500. State discount at the minimum: $333. Together that is $6,333. In an Xcel electric-heat home with no gas bonus it is 3 x $750 = $2,250, plus $1,500, plus $333, which is $4,083. A national laboratory study quoted by CPR News says cold-climate systems for Denver-area homes can cost well over $15,000 installed, so these stack to a real dent but not the whole bill. Your contractor must confirm each amount in writing, because the per-ton figure depends on the exact model's capacity at 5°F.
What Denver homes look like
The US Census Bureau's American Community Survey (2020 to 2024) counts 359,581 homes in Denver. About 51% of households rent and 49% own. Only 40% of homes are detached houses, which is low for a Colorado city, and about 5% sit in buildings of two to four units. More than half (55%) were built before 1980, and 17% before 1940. About 31% went up in 2000 or later.
That mix shapes the plan. A 1950s brick bungalow often has ducts that were sized for a furnace and may need work before a heat pump fits. A newer townhome may already have good ducts and a tight shell, which makes the heat pump a simpler swap. If you rent, the rebate belongs to whoever pays for the equipment, so the useful step is to hand your landlord this page.
What Denver heats with today
The same survey says about 61% of Denver households heat with utility gas, 36% with electricity and almost none with oil. That 36% on electricity is high. Many of those homes have baseboards or older electric furnaces, and a heat pump can cut their winter electric use sharply. For them the standard Xcel amount applies, and the swap is the biggest saving.
The gas homes are the majority. Xcel pays its higher gas-home amount, but your bill will not drop as much as it does for electric heat, because gas is cheap per unit of heat. Ask your contractor for a running-cost estimate, not just a price, and ask whether you want to keep the furnace as backup.
How cold Denver gets
Our climate file, built from ten Januaries (2015 to 2024), shows an average January low of about 15°F in Denver and a coldest day on record in that window near minus 34°F. That is why the rebates ask for cold-climate models. An ordinary heat pump loses capacity as the air drops toward zero. A cold-climate unit keeps most of its output at 5°F, which is the point Xcel uses when it counts tons. Check the model's capacity at 5°F, not its label size.
What ended in 2026
Two things changed this year. The federal 30% credit stopped at the end of 2025. And the Colorado Energy Office closed the single-family version of its income-based rebate program in August 2026. If someone quotes you an $8,000 state rebate, ask for the current dashboard. If your household income is under about 80% of your county's median, call the program's help desk to see what is left for small multifamily or later phases, and ask Xcel about its income-qualified offers.
Group buying in Denver
The city's homeowner page describes a group-buy program run with Switch Together Denver. You sign up, join a group of neighbours who want similar equipment, and an installer prices the job for the group. The city says participants can save up to 10% against the average cost of an install. It is separate from the rebates here, and it still needs your installer to be eligible for each rebate you want.
Top-rated installers in Denver
Ranked by Google reviews (minimum five). We don't take referral fees or paid placements. Before you sign, ask each one whether they are a participating Xcel contractor and a verified Power Ahead Colorado contractor, and whether they are registered for the state heat pump discount.
How to claim Denver heat pump rebates
- Check your Xcel bill. If it shows electric and gas from Xcel, you may get the higher gas-home amount.
- Pick a contractor who is a Power Ahead Colorado contractor, an Xcel participating contractor and registered for the state discount. Ask for all three in writing.
- Have the contractor submit the project to Power Ahead Colorado before any work begins. Work done first does not qualify.
- Ask for the model's output at 5°F, so you can check Xcel's per-ton math yourself.
- After install, check that the state discount appears as its own line on your invoice. You do not file anything for that one.
Common questions
How much can I get for a heat pump in Denver?
On our October 5, 2026 reading: Xcel pays $750 per heating ton, or $1,500 per ton for gas-heated homes, Power Ahead Colorado pays $1,500, and the state discount is at least $333 on an air-source system. Whether you can use all of them depends on your equipment and utility.
Is the Xcel rebate open now?
Xcel's 2026 rebate summary lists the per-ton amounts as starting October 1, 2026. Its page would not load for our reader, so confirm the current status with Xcel before you sign a contract.
Does Denver have its own heat pump rebate for homes?
We could not confirm one. The city's homeowner page lists a group-buy program and links to Xcel, the Colorado Energy Office and Power Ahead Colorado, with no city amount.
Is the state income-based program still open?
No. The Colorado Energy Office says the single-family program is closed, with a dashboard showing funding. Small multifamily and manufactured-home programs were planned for 2026.
Can I stack the rebates?
Power Ahead Colorado and the state discount can be combined with other programs, and Colorado's public radio reports Power Ahead rebates stack with Xcel's. Your contractor should confirm each program's rules for your model.
What to do next
Start by finding out what you heat with and who sends the bill. Then read our Denver insulation rebate page, because a tighter shell lets you buy a smaller, cheaper heat pump, or see the Denver rebate hub for everything else.
By Sam Menard. Sources, last read October 5, 2026: Xcel Energy Colorado residential rebates, Xcel Energy 2026 rebate summary, Power Ahead Colorado rebate overview, State heat pump tax credit page (Colorado Energy Office), Colorado Home Energy Rebate Program, CPR News on the Power Ahead rebate (July 15, 2026). All Denver rebates → Every Xcel Energy Colorado rebate →