Colorado Energy Incentives

Colorado residents have access to a variety of state and federal incentives aimed at promoting energy efficiency and the adoption of renewable energy technologies. Here’s an overview of current programs:

Federal Incentives:

1. Energy Efficient Home Improvement Credit (25C Tax Credit): This credit offers homeowners up to $1,200 annually, covering 30% of the costs for eligible energy-efficient home improvements. Qualifying upgrades include energy audits (up to $150), air sealing, insulation, energy-efficient HVAC systems, windows, and doors. Notably, heat pumps and heat pump water heaters are eligible for a higher credit of up to $2,000. More info

2. Residential Clean Energy Credit: Homeowners installing renewable energy systems like solar panels can benefit from a tax credit covering 30% of the installation costs. This incentive supports the transition to clean energy sources. More info

3. High-Efficiency Electric Home Rebate Act (HEEHRA): Targeting low- and moderate-income households, HEEHRA provides point-of-sale rebates for electrification projects. Eligible upgrades include heat pump HVAC systems, heat pump water heaters, electric stoves, and associated electrical work. Rebates can reach up to $14,000 per household, with the program expected to launch in Colorado in late 2024 or early 2025. More info

State of Colorado Incentives:

1. Heat Pump Tax Credit: Effective January 1, 2024, Colorado offers tax credits for installing Energy Star-certified heat pumps and heat pump water heaters. The credit amount varies based on the type of system installed. To qualify, installations must be performed by registered contractors, who apply the tax credit as a discount at the point of sale. More info

2. Utility Rebates: Many Colorado utility companies provide rebates for energy-efficient upgrades:

   • Colorado Springs Utilities: Offers rebates such as $900 for furnaces, $1,200 for boilers, and between $1,500 to $3,000 for qualified heat pumps. Additional incentives are available for insulation, air sealing, water heaters, smart thermostats, irrigation systems, and ultra-high-efficiency toilets. More info

   • Holy Cross Energy: Customers can access rebates for various energy efficiency and electrification projects. A shared rebate form simplifies the application process for measures eligible under both Holy Cross Energy and Energy Smart Colorado programs. More info

Local Programs:

• Energy Smart Colorado: Collaborates with local partners to offer rebates and financing options for home energy upgrades. Residents can select their county or utility provider on the Energy Smart Colorado website to discover specific rebates available in their area. More info

Next Steps for Homeowners:

• Assess Eligibility: Use tools like the Household Incentive Calculator provided by Rewiring America to determine which federal, state, and utility incentives your household qualifies for. More info

• Consult Professionals: Engage with certified energy auditors or contractors to identify the most effective energy efficiency or electrification upgrades for your home.

• Stay Updated: Since program availability and specifics can change, regularly check official resources such as the Colorado Energy Office and your local utility providers for the latest information on rebates and incentives.

By leveraging these programs, Colorado residents can enhance their homes’ energy efficiency, reduce utility costs, and contribute to environmental sustainability.