Heat pumps
Heat and cool your home efficiently
Today’s heat pumps let you heat and cool your home year-round without using any fossil fuels on site.
Central Hudson’s incentives can help offset the upfront costs of installation, making it more affordable for homeowners to adopt these efficient, all-electric heating and cooling systems.
About heat pumps
Heat pumps work by transferring (or “pumping”) heat from one place to another. In cooling mode, they work just like an air conditioner, using refrigerant to absorb heat from inside a building and transfer it outside. In heating mode, the process is reversed, pulling heat from the outside air or the ground. The warm air is then distributed indoors via ducts or wall-mounted mini-splits.
There are two main types of heat pumps: air-source and ground-source.
Air-source heat pumps (ASHP) pull heat from the air. Cold-climate models work well even in a New York winter.
Ground-source heat pumps (GSHP) pull heat from the ground. Loops full of refrigerant circulate underground.
Learn more by visiting our page, Which Heat Pump Is Right for Me?
Clockwise from top-left: An air-source heat pump outdoor condenser unit; illustration showing buried coils for a ground-source heat pump system; warm or cool air can be distributed via air ducts (bottom right) or an air handler (bottom left).
Air-source Heat Pump Incentives
Central Hudson / Clean Heat Rebate (whole building):
- Up to $1,000 per 10,000 Btuh if removing your oil tank or previous fossil fuel heating source.
- Up to $700 per 10,000 Btuh if installing advanced controls that turn on existing fossil fuel systems as backup or second stage heating.
- Up to $500 per 10,000 Btuh of heating capacity if not removing your oil tank or previous fossil fuel heating source.
Tax incentives:
- A federal tax credit worth 30% of the project cost (limit of $2,000) is available. Check with your tax advisor for any other state or federal tax incentives for clean heat upgrades. Click here for an explanation of the federal tax credits.
Sample project
Air-source heat pump installation
All figures are estimates, shown for sample purposes only. Cost varies with region, installation complexity, installer, system size and manufacturer, age and insulation of your home. Rebate amounts subject to change.
| Total installment cost | $26,365 |
| Central Hudson/Clean Heat Rebate | $5,500* |
| Federal Tax Credit | $2,000** |
| Total estimated system cost | $18,865 |
| Estimated Annual Energy Savings | $900*** |
*Rebate amount based on removing your oil tank or other fossil fuel heating source. $500 may be allocated to the contractor.
**Federal tax deduction for heat pump systems meeting efficiency requirements. Annual limits for total energy efficiency upgrades apply. More info available at Energy Star.
***Efficiency calculated by comparing heating performance of a Northeast Energy Efficiency Partnership (NEEP)-certified air-source heat pumps to an ENERGY STAR-certified oil furnace.
Ground-source heat pump incentives
Central Hudson / Clean Heat Rebate (whole building):
- Up to $2,000 per 10,000 Btuh of full load AHRI capacity. $500 of total incentive may be allocated to the contractor.
Central Hudson Clean Heat Rebate (Partial Home/Building):
- $100 per outdoor condenser.
Federal tax credit:
- 30% off the total cost of the GSHP system.
State tax credit:
- 25% off installation expenses (up to $5,000).
Sample project
Ground-source heat pump installation
All figures are estimates, shown for sample purposes only. Cost varies with region, installation complexity, installer, system size, manufacturer, age and insulation of your home. Rebate amounts subject to change.
| Total installment cost | $60,920 |
| Central Hudson/Clean Heat Rebate | $16,160* |
| Federal Tax Credit | $16,500** |
| NYS Residential Geothermal Heat Pump Tax Credit |
$5,000** |
| Total estimated customer cost | $28,260 |
| Estimated Annual Energy Savings | $1,500*** |
*$500 may be allocated to the contractor.
**Federal tax credit of 30% of the total project cost, state tax credit of 25% or max of $5,000. Check with your tax advisor for any other potential tax incentives. More info available at Energy Star.
***Efficiency calculated by comparing heating performance of an ENERGY STAR-certified closed loop water-to-air geothermal heat pump to an ENERGY STAR-certified oil furnace.
Please note recent changes to eligibility for our Clean Heat Program:
- Projects replacing existing full-load heat pump systems are not eligible for incentives.
- Heat Pumps installed only to serve part of the home’s heating needs are not eligible for incentives.
Cost-effectiveness
Heat pumps can deliver cost-effective heating. Discover if you could save by visiting our online calculator. By providing some basic information about your home and current heating system, you'll see if heat pumps would offer an annual savings savings as well as the estimated project cost, factoring in tax credits and incentives.
Case study
See what goes into a heat pump conversion.
Get started
1) Choose a contractor who is certified with the NYSERDA Clean Heat Program. Your contractor will work with you to determine the size of the unit you need and the total rebate. For air- and ground-source heat pumps, a certified contractor must intall the systems to be eligible for rebates.
2) Have your contractor complete the rebate application.
3) Allow five to seven weeks after submission to receive your rebate check in the mail.
Flexible low-interest financing options are available through New York State for heat pump technology including the On-Bill Recovery Loan, Smart Energy Loan, Renewable Energy Tax Credit Bridge Loan and the Companion Loan.
Heat Pump Water Heaters
The same technology that provides highly effiicient space heating and cooling can also heat your home's water. Take advantage of rebates and incentives while they last.