We’ve seen it – and been through it – countless times. You want a heat pump, contact eight different contractors, half of them won’t install heat pumps, and the other half give you quotes that vary by thousands of dollars, likely without the rebates or incentives factored in that can substantially reduce the cost. It’s overwhelming, and leaves you feeling uncertain about what to do next.
We’re here to change that, and make transitioning to a climate-friendly home easy. That’s why we built a new tool: a free calculator that estimates the upfront and operating costs of installing a heat pump or heat pump water heater in minutes. It’s designed to take the guesswork out of the process, giving you clear, straightforward pricing to help you budget for electrifying your home and understand what to expect – no surprises, just transparency.
How It Works
Our calculator simplifies what would otherwise be a long, complicated process. Instead of asking you for tons of technical details, we ask you a few simple questions like your square footage, ductwork, and weather sealing and take over with our expertise in heat pumps from there.
How We Built It
We didn’t just guess at the numbers. Our team drew from the extensive database of heat pump installations we’ve completed in Colorado and Massachusetts over the last two years. We use real data from homes similar to yours – factoring in house size, heating needs, and even local temperature history to provide the most accurate estimate possible without talking to you first.
Let’s break it down:
Sizing Your Home: We’ve built the calculator using our expertise in building science and system sizing. Your home is matched to one of our 800+ completed installs, with careful attention paid to square footage and heating needs.
Energy Usage: We use a simplified home heating model to estimate how much energy is needed to keep your home comfortable at last year’s daily temperatures, and then to get accurate costs for energy usage. Our tool integrates with local weather data and adjusts based on specific conditions, like whether you’re at a higher elevation or experiencing extreme temperatures.
Rebates and Incentives: The calculator also pulls in all available rebates and incentives for you – including tax credits and income-based incentives. We make sure to show you the maximum savings you may qualify for, taking the hassle out of finding these benefits yourself.
Assumptions: While we’d love to give you an error-free quote down to the dollar without talking to you, technology isn’t quite there yet. The calculator was built on standard assumptions like your floor height, insulation quality, how many windows you have, and the efficiency rating of your existing furnace.
Let’s be real. Heat pumps aren’t cheap, and neither is your time. That’s why we built this calculator: to save you hours of research and back-and-forth with contractors, so you can have a general understanding of what home electrification should cost you.
Ayla and Otto Maher, enjoying their newly-installed Mitsubishi cold climate heat pump.
It started with freezing rooms. Then an oil tank leak. Then countless contractors who said heat pumps won’t work (and boy, were they wrong).
Breaking Up With Fossil Fuels
Tim, a high school math teacher, and Amelia, a public health researcher at Boston University, purchased their home in 2017. The house, which “hadn’t had a lot of love recently,” was a fixer-upper, and the couple, with the help of Tim’s handy dad, tackled various DIY projects. However, it wasn’t until things started breaking down that they seriously considered updating in a bigger way.
“Our oil tank started leaking,” Tim recalls. “That was the impetus to change.” The couple decided to take a leap and fully electrify their home, starting with the installation of a heat pump in mid-2023.
When Tim and Amelia contacted their local contractors and HVAC professionals about installing heat pumps, they were met with serious doubt about heat pumps even working in Boston (and cold climates in general). Luckily, we were there to swoop in and show them the magic of heat pumps – through rain, shine, snow, and ice.
The Heat Pump Effect
After working with Elephant Energy to install their heat pump, Tim and Amelia immediately noticed the perks of breaking up with fossil fuels – both in comfort and efficiency. “The precision of control is something that has been super nice,” Tim explains. “When we were on our oil furnace, there were rooms that were freezing and rooms that were boiling. It felt like you had to change clothes just to move to a different part of the house. Now, each room is exactly the temperature you want it to be.”
What can we say, heat pumps make quite the impression! Shortly after the couple installed their heat pump, they decided to fully electrify their home. They started by replacing their broken water heater with a heat pump water heater, followed by an EV charger and an induction stove.
The Elephant Difference
In Massachusetts, incentives and rebates play a key role in making home electrification affordable and accessible. Tim and Amelia were able to save $10,000 upfront and $2,000 in tax credits, thanks to Mass Save® and the Inflation Reduction Act (IRA).
“The help with the incentives was key. When buying our EV, it felt like there were incentives we were missing out on and we would have to find them ourselves. With Elephant, they worked with us to make sure we got all the Mass Save money”.
Tim and Amelia’s electrification journey is a great example of how switching to sustainable home energy solutions is possible even in cold climates like Boston. Their journey shows that with the right support, you can enjoy a comfortable, efficient, and climate-friendly home.
Interested in starting your home electrification journey?
Valentine’s Day is a time of public declarations – when even those of us that typically refrain from PDA find the courage to tell the world, “hey, just in case it wasn’t clear, I really love this person!”. This can take many shapes and forms–engagement, marriage–and even the “hard launch”, which often happens on our social media feeds.
We’re here with a hot take: if you have a heat pump, it’s time to hard launch your relationship with it this Valentine’s Day.
Why? Well, put simply, personal climate action is contagious – in a good way! Research on solar panel adoption (replicated many times, in many geographies) shows that the biggest predictor of whether you will purchase solar panels is whether your neighbor has already done so! Why? As Katherine Hayhoe so eloquently explains, this lowers “the ‘cost’ of information”.Knowing that you can go down the street and ask who installed the equipment and how it went is, well, comforting.
This isn’t the only research that underscores the importance of social proof when it comes to home electrification, though. A study recently published in the journal Energy Policy abouthousehold energy decision-making and technology adoption in the U.S. found that the top two information sources homeowners sought after during their consideration process were (1) their own friends and family (~42% survey respondents), and (2) online reviews (~36% of survey respondents).
Here’s the tricky thing about heat pumps and heat pump water heaters though, though. These HVAC systems are hidden away in our basements, utility closets, and backyards – entirely out of sight from the neighbors, typically. Remember the old conundrum, “If a tree falls in a forest and no one is around to hear it does it even make a sound?” Feels pretty relevant here!
The point is, taking a public stand for personal climate action can dramatically accelerate the pace of progress in your orbit. By taking a few minutes to “hard launch” your home electrification efforts, you have the opportunity to create a ripple effect of decarbonization far beyond the four walls of your own home.
How to “Hard Launch” your heat pump (on social)
Social media is a great place to share your story! We created these love notes to make it easy. What is an example of a hard launched relationship? Sending ’em a Valentine, of course!
How to Hard Launch your heat pump without social media
No social media? No problem! When should you hard launch a relationship? Well, we’re taking advice from our friends at VeryWellMind on hard launching your relationship without social media, and translating that to heat pumps.
Send a group text to your friends or family members. This can include the name and a photo of your partner. Yes this works great! “Heat Pump” has entered the chat.
Call your friends and family individually to discuss your relationship. Another strong option – share your reasons for why you went electric in a good ol’ fashioned phone call
Bring your partner out with you to meet your friends. Ehh, this one’s a little trickier…but snapping a selfie with your heat pump to share with friends might just do the trick!
Take your partner home to meet your family. This one’s even harder. Then again, dropping off information about a heat pump might be the move
Plan a gathering at which you’ll introduce your new partner to your social circle. This one is a gem! Throw a “meet my heat pump” party (and be sure to send us photos)!
So yes, make the cheesy post about your partner (seriously, always make the cheesy post), but don’t forget to also affirm your commitment to a cause that also needs your support now more than ever – the climate.
— Ready to get started? Join us in building a brighter future by electrifying everything, starting with homes. Your choice today shapes our collective tomorrow!
Does Colorado have a rebate for heat pumps? No – but we do have a new Colorado State tax credit for heat pumps and heat pump water heaters that went into effect on January 1, 2023. This guide is only for heat pumps installed in the state of Colorado in 2023.
The tax credit is an income tax reduction based on 10% of the price of the equipment, not including installation charges.
The 10% tax credit also extends to electrical panel upgrades (if needed for the heat pump or heat pump water heater installation) and energy storage systems.
Inclusive Definition: “Building owners” encompass lessees with lessor-approved installations.
How to Claim / File for the Income Tax Credit:
What is the Colorado energy tax credit for 2024? Simply fill out Form DR 1322 to take advantage of your 2023 heat pump install. This must accompany the building owner’s Colorado income tax return. This is how you will receive the Colorado heat pump tax credit. Instructions below. Note: If you are an Elephant Energy customer, download and use this Form DR 1322 as it is signed by us.
Disclaimer: While we provide guidance, it’s crucial to seek advice from a tax professional regarding individual tax situations. Our presentation doesn’t assume liability for your specific tax circumstances.
PART 1 – Eligibility Certification
Building Owner Information: Fill in your name, Social Security number, and address. Include your spouse’s details only if filing jointly. If the building owner is a business, provide its name and Federal Employer Identification number.
Contractor:
Business Name: Elephant Energy, Inc.
FEIN: 61-1992874
Mailing Address: 1390 Yellow Pine Avenue
City: Boulder
State & Zip Code: CO 80304
Line 1 Installation Address and Date: List the street address of the building where the heat pump or heat pump water heater was installed.
Line 2 Purchase Type, Building Type, and Installation Standard
For purchase type, select the relevant purchase made from one of the highlighted products that Elephant Energy supplies below (with star).
For building type, choose “Residential”.
For Installation Standard, check “Licensed Contractor with Specialized Technicians”
Line 3 Purchase Information: provide the purchase date, serial numbers of the main components of the heat pump or water heater, along with their make and model details. This information is in your invoice from Elephant Energy.
Line 4 Certification of System Requirements and Installation Standards: Elephant Energy can confirm that its installations meet all 6 criteria.
Line 5 Amount of Income Tax Credit
On Line 5a, input the equipment-only cost (do not include labor cost). Please refer to your invoice for this breakdown.
On Line 5b, calculate your heat pump system or water heater credit by multiplying the amount from Line 5a by 10% (0.10). This resulting figure represents your eligible credit. If you’re not assigning the credit, transfer this amount to the appropriate credit schedule (DR 0104CR, DR 0106CR, or DR 0112CR).
PART 2 – Contractor Certification Sales Tax Exemption – Elephant Energy installations have already taken the sales tax exemption so there is nothing for you to do here.
PART 3 – Election Statement for Assignment of Income Tax Credit – Elephant Energy systems are not eligible for assignment back to Elephant Energy.
And once again, thank you for being a part of the Elephant Energy Herd!! You know that heat pumps are a good option for Colorado residents, and we couldn’t be where we are without wonderful customers like yourselves. We’re here for you – before, during, and after your Climate-Friendly Home upgrade.
Is there a federal tax deduction for heat pumps? Yes! The 25C tax credit, under the Inflation Reduction Act, offers substantial benefits for individuals investing in heat pump systems, heat pump water heaters, electrical panel upgrades, select weatherization measures, and energy audits – including you, our customers! How do you qualify for the Inflation Reduction Act heat pump tax credit? Simply install and file the following year to receive the federal tax credit for your heat pump.
Notably:
Value: Enjoy a 30% heat pump federal tax credit on the total purchase of any combination of air source heat pumps and heat pump water heaters, capped at $2,000, other upgrades capped at $1,200 and electrical panel upgrades installed in conjunction with a heat pump or heat pump water heater will be eligible for a tax credit of up to $600. These federal tax credits for heat pumps are definitely worth it!
Installation Deadline: To claim the federal heat pump tax credit in a given tax year, you must have installed your heat pump with a SEER2 rating greater than or equal to 16 during that year (no need to search “what SEER rating do I need for tax credit qualification?”). To claim the federal tax credit for heat pumps or heat pump water heaters for the 2023 tax year, ensure your heat pump HVAC system or heat pump water heater installation was completed before December 31, 2023.
The credit limit is applicable on an annual basis, resetting each year, allowing for its reuse annually.
Property Requirements: Equipment must be installed in an existing home and your principal residence (the place you occupy most of the time). New construction and rentals do not apply for federal tax credits for heat pump installations, including federal tax credits for heat pump water heaters, too. The principal residence must be in the United States and may be a house, houseboat, mobile home, cooperative apartment, condominium, or a manufactured home to qualify.
Example: For instance, if your federal tax liability amounts to $3,000 and you qualify for the maximum $2,000 credit, your owed taxes decrease to $1,000 after applying the credit.
Energy Efficiency
Energy Efficiency investments qualify for the Energy Efficiency tax credit.
This credit is 30% of the project cost up to a maximum of credit value of $1,200
Upgrades that qualify:
Attic Insulation
Basement / crawlspace insulation
Home Energy Audits
A home energy audit for your main home may qualify for a tax credit of up to $150. In order to qualify, the home energy audit must:
Include a written report and inspection that identifies the most significant and cost-effective energy efficiency improvements with respect to the home, including an estimate of the energy and cost savings with respect to such improvement.
Be conducted and prepared by a home energy auditor
Disclaimer: While we provide guidance, it’s crucial to seek advice from a tax professional regarding individual tax situations. Our presentation doesn’t assume liability for your specific tax circumstances.
Wondering how much this will cost you with rebates and tax incentives included?
IRS Form 5695: Complete this form (specifically Part Two: Energy Efficient Home Improvement Credit) to outline your eligibility for the heat pump tax credit.
Fill out your Name, Social Security Number, and your main home’s address.
PART I: Residential Clean Energy Credit
PART II: Energy Efficient Home Improvement Credit
Continue filling out lines 17 through 32.
In Section A Line 18, enter the total invoice amount for insulation and air sealing.
In Section B Line 25ab, enter the total invoice amount for electrical panel upgrades.
In Section B Line 29abc, enter the total invoice amount for heat pumps and/or heat pump water heaters.
Integration with Form 1040: Add the relevant tax credit details to your standard Form 1040 during the tax filing process.
Submission: Ensure Form 5695 is included when filing your taxes to claim the credit accurately.
MORE DETAILED INSTRUCTIONS ON FILLING OUT THE FORM HERE. MORE INFO HERE.
And once again, thank you for being a part of the Elephant Energy Herd!! We couldn’t be where we are without wonderful customers like yourselves. And in return, we’re here for you – before, during, and after your Climate-Friendly Home Upgrade.
