Installing a heat pump is one of the best home upgrades you can make in California. And, thanks to generous rebates, it’s also one of the most affordable. Between statewide programs and federal incentives, California homeowners can save thousands on heat pump installation costs.
At A-1 Guaranteed, we know rebates. We’re a participating contractor with local rebate programs and offer savings that other contractors aren’t authorized to. Plus, we handle the entire process for you, so all you have to do is sit back and save.
This guide breaks down everything you need to know about rebates, including how they work, what’s available in 2025, and how to qualify.
Why California Is Paying Homeowners to Install Heat Pumps
California has big goals for cutting carbon emissions and reducing reliance on fossil fuels. Getting homeowners to replace old gas, oil, and electric resistance heating systems with heat pumps is a major part of that plan.
Rebates encourage homeowners to make the switch by reducing installation costs. So, when it’s time for a furnace or water heater replacement, it makes more sense to install a high-efficiency heat pump than another gas or electric resistance system.
But rebates won’t last forever. Programs are constantly changing, and funding is limited. If you need to replace your heating system, now is the time to install a heat pump and take advantage of savings while they’re here.
How Rebate & Incentive Programs Work
There are several types of heat pump HVAC system and water heater incentives. The most common are rebates, incentives, and low-interest financing. Here’s how they work.
- Rebates – A rebate directly reduces the cost of your new heat pump. Some rebates are applied instantly through your installer, lowering your upfront price. Others are issued after installation.
- Tax Credits – A tax credit lowers the amount of income tax you owe when you file your federal return. Unlike a rebate, this credit is claimed at tax time rather than deducted from your invoice.
- Low-Interest Financing – Some programs offer special financing options with reduced interest rates. These loans can spread out the cost of your new system over time while keeping monthly payments manageable.
The Best California Heat Pump Rebates for 2025
Statewide Rebates — TECH Clean California
TECH Clean California is the state’s flagship heat pump rebate program, funded by the California Public Utilities Commission (CPUC). It helps homeowners install energy-efficient heat pumps for both space and water heating, and it recently launched new rebates.
TECH rebates are available to all single-family households in California that are connected to the electric grid. The highest savings are available to income-qualified customers who are at or below 80% of the area median income (AMI). You can check your eligibility for income-qualified equity rebates here.
| Installation Type | Standard Rebate | Income-Qualified Rebate |
| Heat Pump HVAC System | $1,000-$1,500 | $3,500-$4,000 |
| Heat Pump Water Heater (Northern California) | $1,100-$3,300 | $3,500-$5,700 |
Regional Rebates — Comfortably California (CCA)
Comfortably California is a rebate program offered by Community Choice Aggregators (CCAs) in partnership with PG&E. It’s designed to help homeowners make energy-efficient home upgrades, including heat pumps.
Rebate Amounts
- $150–$500, depending on the size and type of heat pump.
The CCA rebate is technically a contractor incentive. But unlike many companies, we pass 100% of the savings directly to our customers. We’ll deduct the rebate amount your installation qualifies for directly from your invoice.
GoGreen Low-Interest Financing
California homeowners in underserved communities may be eligible for low-interest financing. We can help you take advantage of financing through GoGreen Home, which connects qualifying homeowners with lenders to finance up to 100% of their heat pump installation costs.
Federal Tax Credits (Ending December 31, 2025!)
In addition to California’s rebate programs, homeowners nationwide can claim federal tax credits for heat pump HVAC systems and water heaters.
Available Credit
- Up to $2,000 for a new heat pump HVAC system or heat pump water heater.
This credit is expiring very soon! It’s available for all eligible systems installed by December 31, 2025. After that, the tax credit will be eliminated. Don’t miss this opportunity to save $2,000 on a new heat pump. Reach out to us today to schedule your installation before it’s too late.
Learn More with a Free Consultation
Confused about heat pump rebates and which you may qualify for? A-1 Guaranteed is here to help!
Schedule a free consultation with our team today to learn more about your options. We’ll show you which programs you qualify for, estimate your savings, and take care of all the paperwork for you.
Call 866-883-7198 today to get your free heat pump consultation and estimate.
