Massachusetts Home Energy Rebates: Get Up to $14,000 for Heat Pumps and Electrification Upgrades

If you’re a Massachusetts homeowner looking to replace your old gas furnace with a heat pump, upgrade to an electric water heater, or make other energy-efficient improvements, you can get up to $14,000 in rebates through federal Inflation Reduction Act programs administered by Massachusetts. These aren’t tax credits you wait months to claim—they’re upfront rebates that reduce what you pay at the point of sale.

Massachusetts is rolling out two major rebate programs funded by the IRA: the Home Efficiency Rebates (HOMES) program and the Home Electrification and Appliance Rebates (HEAR) program. Together, they can cover a significant portion of the cost of making your home more energy-efficient and switching from fossil fuels to electric appliances and heating systems.

The rebates are designed to make clean energy upgrades affordable for Massachusetts residents, with enhanced benefits for low- and moderate-income households. If your household income is at or below 80% of Area Median Income (AMI), you could receive rebates covering up to 100% of project costs, capped at $14,000. Even if you earn more, you can still qualify for substantial rebates if your income is at or below 150% of AMI.

What makes these programs particularly valuable is that they stack with existing Mass Save incentives and federal tax credits. You might get a Mass Save rebate, an IRA rebate, and a federal tax credit on the same project, dramatically reducing your out-of-pocket costs. For many Massachusetts homeowners, this combination of incentives makes heat pumps and other electrification upgrades more affordable than sticking with fossil fuel systems.

Key Details at a Glance

What These Rebates Actually Cover

The two IRA rebate programs cover different types of upgrades, and you can potentially use both on the same home:

Home Electrification and Appliance Rebates (HEAR) provide point-of-sale rebates for specific electric appliances and enabling upgrades:

• Heat pumps for heating and cooling: Up to $8,000 for qualifying systems
• Heat pump water heaters: Up to $1,750
• Electric stoves, cooktops, ranges, or ovens: Up to $840
• Electric heat pump clothes dryers: Up to $840
• Electrical panel upgrades: Up to $4,000 (often needed to support new electric appliances)
• Electrical wiring: Up to $2,500
• Insulation, air sealing, and ventilation: Up to $1,600

The total HEAR rebate is capped at $14,000 per household. If you’re at or below 80% AMI, rebates cover 100% of costs up to these limits. If you’re between 80-150% AMI, rebates cover 50% of costs up to these limits.

Home Efficiency Rebates (HOMES) provide rebates based on whole-home energy savings you achieve through efficiency improvements:

• Modeled pathway: Get rebates based on predicted energy savings from a home energy model. You can receive $2,000 per 20% energy savings, up to $8,000 for 35%+ savings (or $4,000 and $16,000 respectively for households ≤80% AMI).
• Measured pathway: Get rebates based on actual measured energy savings. Similar structure but based on real consumption data before and after upgrades.

HOMES rebates can cover a wide range of efficiency improvements: insulation, air sealing, high-efficiency HVAC systems, windows and doors, and other measures that reduce energy consumption.

You can potentially use both HEAR and HOMES rebates, but not for the same specific equipment. For example, you might use HEAR rebates for your heat pump and electrical panel, and HOMES rebates for insulation and air sealing that achieve whole-home energy savings.

Who Qualifies and Income Requirements

The rebates are available to Massachusetts homeowners and renters (with landlord permission) who meet income requirements. The programs use Area Median Income (AMI) as the qualification standard, which varies by county and household size.

For 2024, here are approximate income limits for the Boston metro area (limits are higher in some counties, lower in others—check current limits for your specific location):

80% AMI (100% rebate level):

• 1 person: $70,000
• 2 people: $80,000
• 3 people: $90,000
• 4 people: $100,000
• 5 people: $108,000

150% AMI (50% rebate level):

• 1 person: $131,000
• 2 people: $150,000
• 3 people: $169,000
• 4 people: $187,000
• 5 people: $202,000

These are approximate figures for illustration. Actual limits are updated annually and vary by county. Check the Mass Save or Mass Clean Energy Center website for current limits in your area.

You’re a strong candidate if you:

• Own a home in Massachusetts or rent with landlord permission for upgrades
• Have household income at or below 150% of Area Median Income
• Are planning energy efficiency or electrification upgrades
• Can use approved contractors (Mass Save participating contractors or program-qualified installers)
• Have an older heating system, water heater, or appliances that need replacement
• Want to reduce energy costs and carbon emissions

The programs work especially well for:

• Homeowners replacing aging gas or oil heating systems
• Households with high energy bills looking to reduce costs
• Families in older, drafty homes that need insulation and air sealing
• Renters whose landlords are willing to make energy upgrades
• Moderate-income households who couldn’t otherwise afford heat pumps or major efficiency upgrades

Even if your income is above 150% AMI, you may still qualify for Mass Save rebates and federal tax credits, so don’t assume you can’t get help with energy upgrades.

How Heat Pumps Work and Why They’re Worth It

Since heat pumps are the centerpiece of most electrification projects, it’s worth understanding what they are and why Massachusetts is pushing them so hard.

A heat pump is an electric heating and cooling system that moves heat rather than generating it by burning fuel. In winter, it extracts heat from outdoor air (yes, even when it’s cold) and moves it inside. In summer, it works in reverse, moving heat from inside your home to the outdoors—essentially acting as an air conditioner.

Modern cold-climate heat pumps work efficiently even when outdoor temperatures drop below zero Fahrenheit, making them suitable for Massachusetts winters. They’re typically 2-4 times more efficient than traditional heating systems because they move heat rather than create it.

Benefits of heat pumps:

• Lower operating costs: Most Massachusetts homeowners save 20-40% on heating costs compared to oil, propane, or electric resistance heat
• Cooling included: You get air conditioning, which many Massachusetts homes lack
• Better comfort: Modern heat pumps provide consistent, even heating without the hot and cold spots of forced-air systems
• Cleaner air: No combustion means no carbon monoxide risk and better indoor air quality
• Climate benefits: Dramatically lower carbon emissions, especially as Massachusetts’ electric grid gets cleaner

Types of heat pumps:

• Ducted air-source heat pumps: Work with existing ductwork, similar to central air conditioning
• Ductless mini-splits: Wall-mounted units that don’t require ducts, ideal for homes without existing ductwork
• Ground-source (geothermal) heat pumps: Use underground pipes for even higher efficiency, but much more expensive to install

For most Massachusetts homes, ducted air-source heat pumps or ductless mini-splits are the practical options. Which one makes sense depends on whether you have existing ductwork and how your home is configured.

Stacking Rebates and Incentives for Maximum Savings

The real magic happens when you combine multiple incentive programs. Here’s how a typical project might stack:

Example: Installing a $15,000 heat pump system (household at 80% AMI)

• HEAR rebate (100% up to $8,000): $8,000
• Mass Save heat pump rebate: $1,500-$10,000 (depending on system type and efficiency)
• Federal tax credit (30% of remaining cost): $1,650 (30% of $5,500 after rebates)
• Total incentives: $11,150+
• Your cost: $3,850 or less

Example: Whole-home efficiency upgrade (household at 120% AMI)

• Insulation and air sealing: $6,000
• Heat pump: $15,000
• Electrical panel upgrade: $3,000
• Heat pump water heater: $2,500
• Total project cost: $26,500

Rebates and incentives:

• HEAR rebates (50% up to limits): Heat pump $4,000 + panel $2,000 + water heater $875 = $6,875
• HOMES rebate (for 25% energy savings): $3,000
• Mass Save rebates: $2,000-$5,000
• Federal tax credits (30% of remaining costs): $4,000+
• Total incentives: $15,875-$18,875
• Your cost: $7,625-$10,625 (instead of $26,500)

The exact numbers depend on your specific project, income level, and which programs you qualify for, but the potential savings are substantial.

Application Process and Timeline

The Massachusetts IRA rebate programs are being rolled out in phases. Here’s what to expect:

Phase 1: Program Launch (Late 2024/Early 2025) - The state is finalizing program details, contractor training, and application systems. Mass Save and the Mass Clean Energy Center will announce when applications open.

Phase 2: Contractor Approval - Contractors must be approved to participate in the rebate programs. If you’re planning a project, make sure your contractor is enrolled or planning to enroll. Mass Save participating contractors are likely to be approved, but confirm before starting work.

Phase 3: Application and Pre-Approval - For most projects, you’ll need to apply and get pre-approval before starting work. This ensures you qualify and that your planned upgrades are eligible. The application will require income documentation and project details.

Phase 4: Project Completion - Work with your approved contractor to complete the installation. The contractor will handle much of the paperwork and rebate processing.

Phase 5: Rebate Processing - For HEAR rebates, the discount should be applied at point of sale, reducing what you pay upfront. For HOMES rebates, you may need to submit documentation after completion and wait for payment.

Important timing considerations:

• Don’t start work before getting pre-approval, or you may not qualify for rebates
• Programs are first-come, first-served. Funds are limited and will eventually run out
• Apply early rather than waiting. Demand will be high, especially in the first years
• Plan for 2-4 months from application to project completion for typical projects

Check the Mass Save website regularly for updates on when applications open and current program status.

Insider Tips for Maximizing Your Rebates

Get a Mass Save Home Energy Assessment first. This free assessment (or $50 for moderate-income households) identifies what upgrades will save you the most energy and money. The assessor can help you understand which rebates you qualify for and recommend a logical sequence for upgrades. Call Mass Save or apply online to schedule.

Do insulation and air sealing before or with your heat pump. Heat pumps work best in well-insulated homes. If your home is drafty, the heat pump will have to work harder and cost more to operate. Insulation and air sealing often qualify for both HEAR and HOMES rebates and improve the performance of your heat pump.

Check if you need an electrical panel upgrade. Many older Massachusetts homes have 100-amp or smaller electrical panels that can’t handle a heat pump, electric water heater, and other electric appliances. Panel upgrades can cost $2,000-$5,000, but HEAR rebates cover up to $4,000 of this cost. Include the panel upgrade in your project plan from the start.

Consider doing multiple upgrades at once. You can maximize HOMES rebates by achieving higher energy savings through comprehensive upgrades. Doing heat pump, insulation, air sealing, and water heater together might get you to 35% energy savings and a larger rebate than doing projects separately.

Work with experienced Mass Save contractors. Contractors familiar with Mass Save programs know how to navigate the rebate systems, maximize your incentives, and ensure installations meet program requirements. Ask contractors about their experience with heat pumps and energy efficiency rebates.

Document your current energy use. For HOMES rebates, you’ll need to show energy savings. Keep 12 months of utility bills before starting your project. This baseline data is essential for calculating savings.

Don’t forget the federal tax credit. The IRA also provides a 30% federal tax credit (up to $2,000 per year) for heat pumps, heat pump water heaters, insulation, and other qualifying improvements. This stacks with state rebates. Keep all receipts and documentation for your tax filing.

Plan for the long term. These rebates are available through 2031 or until funds run out. If you can’t afford a comprehensive project now, you might start with insulation and air sealing, then do the heat pump in a year or two. Just be aware that funds may not last until 2031 if demand is high.

Common Questions and Concerns About Heat Pumps

“Will a heat pump really work in Massachusetts winters?” Yes. Modern cold-climate heat pumps are designed for New England winters and work efficiently down to -15°F or colder. Many Massachusetts homeowners have successfully switched to heat pumps and stayed warm through winter.

“What if it gets really cold?” Most heat pump installations include backup heat (either electric resistance or keeping your existing system as backup) for extreme cold snaps. In practice, backup heat is rarely needed with properly sized cold-climate heat pumps.

“Will my electric bill go up?” Your electric bill will increase because you’re using electricity for heating instead of gas or oil. But your total energy costs (electric + gas/oil) typically decrease by 20-40% because heat pumps are so efficient. You’re spending more on electricity but saving more by eliminating or drastically reducing gas/oil use.

“Do I have to get rid of my gas furnace?” Not necessarily. Many homeowners keep their existing system as backup, especially in the first year while they get comfortable with the heat pump. Over time, most people find they rarely use the backup and could have removed it. Some rebate programs provide higher incentives for full electrification (removing the gas system entirely).

“What about maintenance?” Heat pumps require annual maintenance similar to air conditioners—filter changes, coil cleaning, refrigerant checks. This typically costs $150-$300 per year. Gas furnaces also require annual maintenance, so the maintenance burden is similar.

“How long do heat pumps last?” Quality heat pumps typically last 15-20 years with proper maintenance, similar to gas furnaces and central air conditioners.

What to Do Right Now

Step 1: Check your income against AMI limits for your county and household size. Mass Save and Mass Clean Energy Center websites have income calculators.

Step 2: Schedule a free Mass Save Home Energy Assessment. Call 866-527-7283 or visit masssave.com. The assessment is the foundation for planning your upgrades.

Step 3: Research heat pumps and other upgrades you’re interested in. The Mass Save website has detailed information about different technologies and their benefits.

Step 4: Get quotes from Mass Save participating contractors. Ask about their experience with heat pumps, what rebates and incentives your project would qualify for, and their timeline for completing work.

Step 5: Watch for announcements about when IRA rebate applications open. Sign up for Mass Save email updates to be notified.

Step 6: When applications open, apply promptly. Programs are first-come, first-served, and funds are limited.

For current information about Massachusetts IRA rebate programs, visit:

• Mass Save: masssave.com/electrification
• Mass Clean Energy Center: Check their website for IRA program updates
• Call Mass Save: 866-527-7283 for personalized guidance

Massachusetts is making a major push to help homeowners electrify and improve energy efficiency. These rebates represent a once-in-a-generation opportunity to upgrade your home, reduce energy costs, and eliminate fossil fuel use—with much of the cost covered by rebates and incentives. If you’ve been thinking about a heat pump or other energy upgrades, now is the time to act.