Unlocking Savings: HVAC and Home Energy Rebates

Never leave money on the table.

When you are considering upgrading your HVAC or other home system—be it with efficient heat pumps, smart water heaters, or eco-friendly EV chargers—always check for rebates and other incentives you may qualify for to help offset your installation costs.

In this blog, Ballard Natural Gas Service will outline a robust suite of incentives aimed at making sustainable home improvements more affordable, including the following categories of HVAC and electrification rebates:

• Federal Home Energy and HVAC Rebates and Tax Credits
• Utility-Based HVAC and Home Energy Rebates
• Fossil Fuel Conversion HVAC Rebate Programs

From local utility partnerships to federal tax credits and city-funded programs, these rebates can substantially offset upfront costs and contribute to long-term savings. Let’s explore each category in detail.

Federal Home Energy and HVAC Rebates and Tax Credits

Federal Tax Credits

In 2022, the Inflation Reduction Act established new tax credits for energy-saving home upgrades. These can reduce the amount you owe in taxes (though you won’t receive a refund for them) based on the following upgrades:

Air conditioners and furnaces: Up to $600

Air-source heat pumps and heat pump water heaters: Up to $2,000

Energy audits: Up to $150

Electrical panel upgrades: Up to $600

Insulation and air sealing: Up to $1,200

Windows and skylights: Up to $600

EV charging: Up to $1,000

Solar, battery storage, geothermal systems: 30% of total cost with no cap

The 2025 federal budget, finalized in July, updated this tax law so that these tax credits will expire on December 31, 2025.

What does that mean? To qualify for these tax credits, homeowners must purchase and complete these installation projects before the end of this year in order to file their 2025 tax return.

Home Energy Rebates Program

Also established under the IRA and funded by the U.S. Department of Energy (DOE), this initiative helps individual states offer cash rebates for eligible upgrades to residential homeowners with low to moderate income.

The funding for these programs is set; they will continue offering states funding while it is still available or until it expires on September 30, 2031, whichever occurs first.

Washington’s application for funding was approved earlier this year, and it is actively planning to create two state-run programs:

• Home Appliance Rebate Program: Point-of-sale rebates for income-eligible homeowners on select energy efficient electric equipment or electrification projects.
• Whole-Home Efficiency Rebates: These rebates will vary based on how much energy is saved and income qualification and will be applicable towards whole-home energy-saving retrofits.

These programs are expected to launch in late summer or early fall of 2025. Learn more about these programs on the state’s website.

Utility-Based HVAC and Home Energy Rebates

Depending on where in the greater Seattle region you reside, there are varying programs available from some of the area’s utility companies.

Puget Sound Energy (PSE) Heat Pump and Water Heater Rebates

Single-family residences making energy-efficient upgrades can earn the following rebates under this program. Boost rebates are available based on income. Review the program details online.

• Ducted or Ductless Heat Pump Installation: Enjoy up to $2,400 back when installing an energy-efficient heat pump.
• Gas Furnace Installations: Get up to $750 back for qualifying natural gas forced-air furnaces.
• Water Heater Rebates: Targeted incentives include up to $850 for high-efficiency heat pump water heaters or up to $660 for energy-efficient natural gas tankless water heaters.
• EV Chargers: Select level 2 EV chargers can qualify for a rebate of up to $300. Income-qualifying households can receive an additional up to $300 (for a total of up to $600).
• Additional Rebates: Other appliances, including smart thermostats, and projects may qualify for varying rebates.

Seattle City Light (SCL) Heat Pump Rebates

These rebate opportunities have been extended into 2025 and are available to homeowners and renters. For complete rebate details, visit the SCL rebate webpage.

• Heat Pump Rebates: Distributors can receive instant rebates of up to $600 when purchasing select SEER-rated heat pump systems. These savings are passed on to individual HVAC contractors/companies and, subsequently, homeowners.
• Oil to Electric Heating Conversions: Households that convert to a qualifying heat pump system could receive a $2,000 rebate.
• Water Heater Rebates: Homeowners who upgrade to a heat pump water heater (also known as (hybrid water heater) can qualify for a $750 rebate.
• Additional Rebates: Other upgrades, including installing a smart thermostat, are available.

Snohomish PUD

Homeowners Public Utility District’s jurisdiction can qualify for an array of rebate options. For full rebate details, visit the Snohomish PUD rebate webpage.

• Heat Pumps: Up to $2,500 for inverter-driven ducted systems, and $1,500 for standard systems.
• Electric Hybrid/Heat Pump Water Heaters: A generous $750 coupon/rebate for qualified models.
• EV Chargers: PUD offers an instant $50 rebate for select EV charging models.
• Additional Rebates: Other upgrades, including installing a smart thermostat, are available.

Fossil Fuel Conversion HVAC Rebate Programs

Depending on where you live, there may be additional programs available to help you transition from a fossil-fuel-burning heat source to a qualifying heat pump system.

City of Seattle Fuel Conversion Rebates

As Seattle accelerates its clean-energy goals, the Clean Heat Program is a major focus. If you’re transitioning from oil to a Mitsubishi Electric heat pump starting September 1, 2024, (and for a limited time) you’re eligible for:

• $2,000 from the City’s flagship program, plus
• Seattle will offer an additional $2,000 bonus to moderate-income households (81%–150% of the Area’s Median Income).

That totals a remarkable $6,000—enough to make heat pump adoption very attractive indeed!

Energy Smart Eastside (ESE) Heat Pump Conversion Rebates

For residents of Bellevue, Issaquah, Kirkland, Mercer Island, Redmond, or Sammamish, the Energy Smart Eastside (ESE) initiative delivers targeted incentives, including:

• Fuel Switch Rebate: Up to $6,000 for low-to-moderate income households making the switch from fossil fuel systems to heat pumps.
• $1,000 Heat Pump Rebate: Accessible to Eastside homeowners who do not qualify for the Fuel Switch Rebate and are installing a Mitsubishi, Carrier, or Bryant heat pump.
• Boost Rebates: Covers the cost of a heat pump conversion (from a fossil fuel system) for Eastside residents with a household income below 80% of area median income.

Why These HVAC and Home Energy Rebates Matter

• Slash Costs, Boost Comfort: Recouping hundreds—or even thousands—of dollars makes higher-efficiency systems much more cost-effective. Combined rebates and tax credits can often cover 30–50% of installation costs.
• Eco-Friendly Upgrade: Upgrading to heat pumps or hybrid systems drastically cuts your carbon footprint—supporting Washington State and national emissions goals.
• Combining Incentives: These rebates (including those with income-based bonuses) can be combined with federal tax credits.

Tips for Maximizing HVAC and Home Energy Rebates

• Pick Authorized Contractors:  Many rebates require installation by qualified, participating providers. Ballard Natural Gas Service is one such provider.
• Combine and Coordinate: Always check timing! Programs and tax credits may expire or evolve.
• Verify Qualifications: Some rebates are income-qualified—check area median income limits—or by verified residential address.
• Confirm With Utilities: Before signing on any project, contact your local utility to understand current rebate payouts and availability.

Contact Ballard Natural Gas Service

If you’re considering an HVAC or home energy upgrade—whether it’s a high-efficiency heat pump, hybrid water heater, or EV charger—Ballard Natural Gas Service outlines several potential rebates you should consider that could cut your costs by thousands.

As a licensed HVAC provider, Ballard Natural Gas Service serves as a knowledgeable partner for navigating this complex rebate landscape. We offer clear, updated info on eligibility criteria and timelines as well as help submitting applications to maximize rebate success

By actively tapping into these rebates, homeowners can reduce costs, increase property value, and support a greener future. If you need help identifying what you’re eligible for or coordinating installations, reach out—we’re ready to guide you every step of the way. Call 206-504-1535, contact us online, or request estimate online for your desired home energy upgrade project.

Due to government regulation, this information can change after the blog is published. Speak to a professional to verify available rebates and tax credits.