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Incentives & Financing

Thousands of dollars in incentives and special financing options are available to support clean heating and cooling installations. Learn more about the options available to you, as well as the standard pricing HeatSmart Melrose is offering.

A variety of programs from the state and utilities are available to support clean heating and cooling installations. The table below summarizes each of the available programs, and a more detailed guide can be found here.

Rebates & Credits

Program Name Description
Mass Save: Electric Heating and Cooling Rebate Program

Eligible technologies: Air Source Heat Pumps

Summary: Mass Save offers a range of rebates for air source heat pumps depending on the type of system you are installing and what heating fuel you are currently using. 

Currently heating with oil or propane: You are eligible for a rebate of $1,250 per ton of Heat Pump capacity installed if you either remove your existing system or install integrated controls. If you do not choose to install integrated controls, you are eligible for a rebate of $250 per ton of Heat Pump capacity installed. 

Currently heating with electric resistance: You are eligible for a rebate of $1,250 per ton of Heat Pump capacity installed regardless. 

Currently heating with natural gas: You are eligible for a rebate of $250 per ton of Heat Pump capacity installed. 

Mass Save: Heat Pump Water Heater Rebate Program

Eligible Technologies: Heat Pump Water Heaters

Summary: If you are replacing an existing electric storage-tank water heater or building a new home you are eligible for a one-time rebate based on the size of the heat pump water heater.

To Qualify: If you are installing a qualified 55 gallon or smaller HPWH, you are eligible for a rebate of $600. If you are installing a qualified 55 gallon or larger HPWH you are eligible for a rebate of $150.

MassCEC Clean Heating and Cooling Program

Eligible technologies: Air Source Heat Pumps & Solar Hot Water

Summary: The Massachusetts Clean Energy Center (MassCEC) offers thousands of dollars of rebates for households installing air source heat pumps as their primary, whole-home heating system. MassCEC also provides thousands of dollars of rebates for customers installing solar hot water systems. These incentives are scheduled to expire by the end of 2020.

To qualify: For ASHP, you can qualify for a $2,500 rebate if you are replacing a gas heating system or for a new construction project. You can receive an additional $500 rebate if you complete a blower door test as part of sizing and designing your system.

For SHW, you can receive a rebate of up to $2,000 depending on the number and production of the collectors you install, with an added $500 rebate for installing metering equipment.

You will also need to have completed a Mass Save Home Energy Assessment in the past four years (or that you commit to completing one within six months). Sign up for one today if you haven't already!

Income Eligibility: You can receive a larger rebate if you meet certain income eligibility requirements (<80% or <120% of the state median income) up to $4,500-5,500 per household, click here for more information or are representing a non-profit, government, or affordable housing project.

Massachusetts Dept. of Energy Resources: Alternative Energy Certificates

Eligible technologies: Air Source Heat Pumps & Solar Hot Water

Summary: Any resident who installs an air source heat pump as their only or primary source of heat is eligible to receive and sell Alternative Energy Certificates (AECs), which are awarded to owners of clean heating & cooling technologies through the Commonwealth's Alternative Portfolio Standard. 

To qualify: The number of certificates you receive will be based on a variety of criteria, including:

  1. Whether the heat pump is the sole source of heat or has a backup system
  2. How efficient the overall home is (based on HERS score or other ratings)
  3. The square footage of your home 

Depending on these factors, and the value of the AECs at quarterly auctions, you could receive between $300 - $3,700

An Excel calculator developed by the Dept. of Energy Resources is available here.

We would recommend using a conservative estimate of $5-$15/MWh or lower to represent a lower auction value of these AECs and deducting the costs needed for selling your certificates to state utilities through an aggregator of ~7-10%

Federal Energy Efficiency Tax Credit

Eligible technologies: Air Source Heat Pumps & Heat Pump Water Heaters & Solar Hot Water

Summary: The federal government offers one-time rebate incentives for the installation of high-efficiency heating and cooling equipment as well as heat pump water heaters. Equipment must meet minimum performance thresholds to apply and the system must be installed by end of 2020.

Solar hot water systems receive a federal tax credit of 26% of the system cost if installed before end of 2020. Systems installed in 2021 will receive a 22% tax credit.

Speak with your installer if your system will be installed by end of 2020.

To Apply: Complete the Form 5695 and attach it to your tax returns. You can find more details here

 

Financing

Program Name Description
Mass Save HEAT Loan

Eligible technologies: Air Source Heat Pumps, Ground Source Heat Pumps, and Solar Hot Water

Clean heating and cooling technologies can be financed by the Mass Save HEAT Loan, which is offered at a maximum of $25,000 at 0% interest for terms of up to 7 years through over 90 banks and credit unions. Learn more about the HEAT Loan and participating lenders here.

To Qualify: Mass Save HEAT Loans can be used on a variety of projects and come with several specific requirements: 

  • You may finance any number of eligible energy improvements—including air sealing, insulation, hot water upgrades, and more—on a single HEAT Loan.
  • You may only receive one HEAT Loan regardless of how many Home Energy Assessments or energy improvements you are seeking to make. Try to combine as many home energy improvement measures onto one loan if possible!
  • To receive a HEAT Loan, you will need to have received a Home Energy Assessment within the last two years.

Note: While all technologies are eligible, certain configurations or equipment models may be ineligible for the HEAT Loan. Speak to your installer if you have any questions or concerns.