What Colorado pays for a heat pump water heater
We read the Colorado Springs Utilities, Efficiency Works (Fort Collins), state and Colorado Energy Office pages on October 5, 2026. Xcel's amounts come from its 2026 rebate summary, because Xcel's own pages load by script and would not open for our reader. Denver, Aurora and Boulder are all Xcel areas, so one Xcel card covers them.
Xcel Energy (Denver, Aurora, Boulder)
ENERGY STAR certified with a 3.3 UEF. The summary lists the amounts from October 1, 2026, so confirm they are live. The higher amount is for gas-heated homes.
Colorado Springs Utilities
For electric customers, ENERGY STAR certified, with a permit and final inspection from the Pikes Peak Regional Building Department. Two rebates per address every three years. Apply by January 31, 2027.
Efficiency Works (Fort Collins)
$600 replacing an electric or propane water heater, $400 replacing natural gas. ENERGY STAR certified. Apply within 45 days of purchase.
State discount
From a $250 state credit. A contractor registered with the state must take it off your invoice. The contractor may pass on more.
State income-based rebates (HEAR)
Up to $1,750 for a heat pump water heater while open. The single-family program is now closed.
Federal tax credit (25C)
Ended for spending after December 31, 2025.
Working it out
A Denver home with Xcel gas could collect $1,500 from Xcel and at least $83 from the state, which is $1,583. The same swap in an Xcel electric-heat home is $750 plus $83, or $833. In Colorado Springs, an electric customer gets $750 plus $83, or $833. In Fort Collins, replacing an electric tank pays $600 plus $83, or $683, and replacing a gas tank pays $400 plus $83, or $483. Boulder households at or below median income may also use EnergySmart's 50% rebate, which includes heat pump water heaters, up to $2,000 a year.
Why the amounts differ so much
Each utility sets its own amount and its own reason. Xcel's gas bonus pays a gas-heated home twice as much, which is the biggest swing in the state. Colorado Springs Utilities pays only its electric customers $750, since a gas customer there is offered a $300 rebate on a new gas storage water heater instead. Fort Collins pays more for replacing electric or propane than for replacing gas. If you are choosing between a gas tank and a heat pump, ask each rebate office for its number for your exact situation, then compare it to the price difference between the two.
What you need to qualify
All three utilities require an ENERGY STAR certified unit, and Xcel's summary names a 3.3 UEF. Colorado Springs Utilities requires you to be an electric customer, to pull a permit, and to pass a final inspection with the Pikes Peak Regional Building Department; the work can be done by a Colorado contractor or by you with a permit. Efficiency Works takes retail purchases and asks for an application within 45 days. The state discount needs a contractor registered with the Colorado Energy Office, so ask for that before you sign.
Condos, rentals and shared tanks
A heat pump water heater needs room and a drain, and swapping one is a decision for whoever owns the building. A tenant cannot usually swap the tank, and a condo with a central boiler does not have a tank to swap. If you rent, give this page to the owner. If you own a condo with its own tank, ask your association about noise and clearance rules, because we have not verified any Colorado rule on that and do not state one.
Where the rebates stack and where they stop
The state's discount is taken off the invoice by your contractor and does not need a form from you. The utility rebates are paid separately. The state's income-based HEAR rebate would have paid up to $1,750 for a heat pump water heater, but the single-family program is closed, and the federal credit ended after 2025. Boulder County households at or below median income can use EnergySmart for 50% of the cost up to $2,000 a year, which covers heat pump water heaters.
Panels and wiring
A heat pump water heater usually runs on a 240-volt circuit. If your panel is full, Efficiency Works pays up to $500 for a 200-amp or larger panel upgrade and $250 for a load sharing device when it is done with a heat pump water heater or another listed project. Check with your electric company before you plan a panel upgrade, since we found that offer only for Fort Collins.
How to claim a Colorado heat pump water heater rebate
- Find your utility on your bill: Xcel, Colorado Springs Utilities or Fort Collins Utilities.
- Ask for a quote on an ENERGY STAR heat pump water heater, with the model number and UEF on it.
- Check whether your contractor is registered for the state discount.
- In Colorado Springs, pull the permit and book the final inspection. In Fort Collins, apply within 45 days.
- Keep the invoice and receipt. Xcel's page and its contractor can confirm the current amount.
More for Colorado homes
- Colorado home rebates: every program in one place
- Xcel Energy Colorado rebates: amounts and rules
- Federal tax credits in 2026: which credits ended
- Colorado battery incentives: Xcel Renewable Battery Connect
- Denver home rebates: programs and installers
- Aurora home rebates: programs and installers
- Boulder home rebates: programs and installers
- Fort Collins home rebates: programs and installers
- Colorado Springs home rebates: programs and installers
Common questions
How much do Colorado utilities pay for a heat pump water heater?
Xcel $750, or $1,500 in gas-heated homes. Colorado Springs Utilities $750 for electric customers. Fort Collins $600 replacing electric or propane and $400 replacing gas. The state discount adds at least $83.
Do I need a certain model?
All three require ENERGY STAR certification. Xcel's summary names a 3.3 UEF.
Is the Xcel amount open yet?
Xcel's 2026 summary lists it from October 1, 2026. Its page would not load for us, so confirm with Xcel.
Can I do the work myself?
In Colorado Springs, yes, with a Pikes Peak Regional Building Department permit and a passed inspection. The state discount needs a registered contractor.
Is there a federal credit?
Not for 2026. The 25C credit ended for spending after December 31, 2025.
By Sam Menard. Sources, last read October 5, 2026: Xcel Energy 2026 rebate summary, Colorado Springs Utilities water heater rebate, Colorado Springs Utilities rebate rules, Efficiency Works retail products sheet, State heat pump tax credit page (Colorado Energy Office), Colorado Home Energy Rebate Program.