Short answer: in October 2026, a Colorado homeowner replacing a gas furnace with a cold-climate heat pump can usually stack three things. Those are a utility rebate (for most of the Front Range, Xcel Energy), the state heat pump tax credit passed through by your contractor, and, in the Denver metro, a $1,500 Power Ahead Colorado rebate. The federal tax credit and the state HEAR rebates for single-family homes are both gone.
Below is what's live, what ended, and the order to do things in. Every program here links to its own page with a "verified on" date, because these numbers have changed several times this year.
What's live right now
| Program | Who | Amount (as published) | Who applies |
|---|---|---|---|
| Xcel Energy heat pump rebate | Xcel electric customers | Cold-climate: $750 per heating ton at 5°F, or $1,500 with the bonus for Xcel gas-heated homes | Your contractor, after install |
| Colorado heat pump tax credit | Statewide | Up to $1,000 air-source credit to the contractor, at least $333 passed to you; the 2026 amount may be lower | Your contractor |
| Power Ahead Colorado | Existing buildings in DRCOG member areas | $1,500 per cold-climate heat pump system | Your contractor, preapproval before work |
| Colorado Springs Utilities | CSU electric customers | $1,500 under 3 tons, $3,000 at 3 tons and over (cold-climate) | You, after install |
| Holy Cross Energy | Holy Cross members | $3,500 per project, $7,000 income-qualified | You, within 90 days |
| Black Hills Energy (electric) | Black Hills electric customers | $3,648 air-source, $3,280 ductless | Written preapproval first |
| Efficiency Works | Fort Collins, Loveland, Longmont, Estes Park | $1,500 to $2,000 ducted | Within 45 days |
| United Power | United Power members | $500 to $1,000 ducted | Within 90 days |
| Boulder County EnergySmart | Boulder County, at or below 100% AMI | 50% of cost up to $2,000 | You, preapproval first |
Boulder County, Longmont and Erie residents also have a county-backed heat pump group-buy open until November 8, 2026. It is a discount program, not a rebate; the county estimates about $4,500 off an average 3-ton system.
The Xcel change on October 1
Xcel cut its heat pump bonus on October 1, 2026. The rebate summary now lists $1,500 per heating ton at 5°F for cold-climate units with the bonus, down from $2,250 earlier in the year. The bonus only applies if Xcel supplies the natural gas that heats your home. Since November 16, 2025, homes with existing electric resistance heat get the standard rebate only. Installs must be invoiced by December 31, 2026, and Xcel accepts applications through September 30, 2027.
Xcel pays per heating ton at 5°F, not per nameplate ton. A unit's 5°F capacity is often lower than its sales size, so ask your contractor for the AHRI certificate and the rebate they expect before you sign.
The state tax credit
The state credit is up to $1,000 for an air-source heat pump in 2026 ($2,000 for ground-source, $250 for a heat pump water heater), per the Colorado Energy Office. Your contractor claims the credit and must show at least a third of it on your invoice as "State of Colorado Heat Pump Discount". You file nothing.
The 2026 amount may be lower. A legislative fiscal note for HB26-1289 says 2026 credits are halved, while the CEO page still shows the full amounts. Ask your contractor which amount they are passing through.
What ended
- Federal 25C and 25D tax credits. Ended for equipment placed in service (25C) or installations completed (25D) after December 31, 2025. See what happened to the federal credits.
- HEAR, single-family. The income-qualified point-of-sale rebates (up to $8,000 for a cold-climate heat pump) closed in the Front Range region in late April 2026 and statewide for new proposals after August 1, 2026. See Power Ahead and HEAR status.
- Denver Climate Action Rebates. Denver said in March 2025 that its residential heat pump rebate was fully subscribed for 2025. We could not find an official 2026 status; Denver's rebate pages returned errors when we checked. Ask Denver's Office of Climate Action, Sustainability and Resiliency before counting on it.
- Boulder County standard rebates. Retired in late 2025. Only the income-qualified tier remains.
The order to apply in
Getting the order wrong is the most common way to lose a rebate. This sequence works for a typical Xcel customer in the metro:
- Choose a contractor who qualifies for everything you want. For the full stack, that means Xcel Trade Partner Network, Colorado Energy Office registration for the state credit, and Power Ahead verification. Each program publishes its own list. See how to choose an installer.
- Get preapproval where required, before work starts. Power Ahead, Black Hills Energy electric and Boulder County EnergySmart all require it.
- Confirm the equipment qualifies. Xcel's cold-climate tier requires a COP of at least 1.75 at 5°F and 5°F capacity of at least 70% of 47°F capacity, with an AHRI listing.
- Install, then check the invoice. Look for the state discount line and the right model numbers.
- Make sure the post-install applications get filed. Your contractor files Xcel and Power Ahead. You file CSU, Holy Cross, Efficiency Works and United Power yourself, inside their deadlines.
How much it adds up to
The total depends on your utility, how many tons qualify at 5°F, whether gas from Xcel heats your home, and your income. As an illustration using the published figures only: a Denver home heated with Xcel gas installing one cold-climate system that Xcel credits at 2 heating tons at 5°F could see $3,000 from Xcel, $1,500 from Power Ahead and at least $333 through the state credit (possibly less in 2026). Your contractor's AHRI numbers decide the real figure.
For what the system itself costs, see what a heat pump costs in Colorado.