New Hampshire Heat Pump Rebates & Incentives Guide

New Hampshire offers heat pump incentives through state revolving loans, utility rebates, on-bill financing, federal tax credits, and grant programs. Combining these can significantly offset installation costs.

Quick Answer: New Hampshire Heat Pump Incentives at a Glance

New Hampshire heat pump incentives for homeowners, businesses, and non-profits include:

• State loan program: The NH Community Development Finance Authority (CDFA) Clean Energy Fund provides low-cost financing for businesses, non-profits, and municipalities (NH CDFA Clean Energy Fund).
• Utility loan: Eversource, in partnership with the National Energy Improvement Fund (NEIF), offers 100% loan financing for residential heat pump installations (Eversource / NEIF Residential Clean Energy Loan).
• Co-op on-bill financing: NH Electric Co-op (NHEC) members can borrow up to $4,000 at 0% interest for qualifying energy efficiency projects (NHEC Residential Energy Efficiency Loan).
• Utility rebates: Unitil gas customers can receive up to $4,000 in rebates through the Home Performance with ENERGY STAR program (Unitil Gas Networks).
• Federal credits: IRS §25C allows a 30% tax credit up to $2,000 per year for qualifying heat pumps, stackable with most state and utility programs.

Programs can be combined. An Eversource homeowner filing federal taxes could use a NEIF loan for upfront costs and claim the §25C credit to reduce their tax bill.

State-Level Financial Assistance for Heat Pumps in NH

CDFA Clean Energy Fund

The New Hampshire Community Development Finance Authority administers the Clean Energy Fund, a revolving loan pool capitalized at over $9 million (NH CDFA Clean Energy Fund). The fund merges three revolving loan funds into one program, covering energy efficiency and renewable energy installations.

Who qualifies: Businesses, non-profits, and municipalities. This fund targets businesses, non-profits, and municipalities seeking to reduce energy costs.

What it funds: Projects focused on cost reduction through energy efficiency and clean or renewable energy, which includes heat pump systems for space and water heating.

Application: The CDFA manages the application process directly. Contact the NH Community Development Finance Authority at resources.nhcdfa.org for application materials and to confirm project eligibility.

Loan terms vary; consult the CDFA directly for current rates and repayment periods.

Eversource Residential Clean Energy Loan (via NEIF)

Eversource and the National Energy Improvement Fund have partnered to offer New Hampshire homeowners 100% financing for heat pumps, ductless heating and cooling systems, and battery energy storage systems (Eversource / National Energy Improvement Fund).

• The loan covers 100% of project costs with no down payment.
• Work must be performed by a NEIF-Approved Contractor.
• Loan terms vary; consult neifund.org/nh-residential-clean-energy or NEIF directly.

The NEIF website provides a searchable list of approved contractors. Projects are ineligible if performed by an unapproved contractor.

Utility-Specific Heat Pump Rebates and Energy Efficiency Programs

New Hampshire Electric Co-op (NHEC): Residential Energy Efficiency Loan

NHEC offers On-Bill Financing Loans for members completing eligible projects under the NHEC Home Performance with ENERGY STAR program (New Hampshire Electric Co-op).

• Loan amount: Up to $4,000
• Interest rate: 0%
• Repayment period: Up to 48 months
• Repayment method: Added directly to your monthly electric bill

NHEC also offers a Loan Buy-Down Program, subsidizing interest on larger third-party loans for qualifying Home Performance with ENERGY STAR projects.

On-bill financing integrates payments into the monthly electric bill. Eligibility requires NHEC membership and participation in the Home Performance with ENERGY STAR program, typically following an energy assessment.

Unitil (Gas): Residential Energy Efficiency Program

Unitil's program targets New Hampshire residential natural gas customers with above-average energy bills (Unitil, administered by Gas Networks).

• Entry point: A home energy audit that identifies where efficiency improvements will have the most impact.
• Rebate: 50% of qualifying improvement costs, up to $4,000.
• Eligible improvements: Weatherization, insulation, and other measures identified through the Home Performance with ENERGY STAR process.

This program is most relevant for replacing gas heating systems or improving building envelopes alongside heat pump installations. An energy audit is required to qualify for the rebate.

Liberty Utilities (Gas): Commercial Energy Efficiency Programs

Liberty Utilities offers incentives for commercial natural gas customers across several categories (Liberty Utilities, Gas).

Measure categories include:

• Space heating equipment
• Water heating
• Energy assessments and engineering studies
• Commercial kitchen equipment
• Weatherization and insulation
• Custom measures

Service rebates are also available for equipment cleanings and tune-ups performed by approved professionals. Incentive amounts vary by equipment specifications; contact Liberty Utilities' New Hampshire commercial programs team for current schedules.

Key New Hampshire Energy Policies Supporting Heat Pump Adoption

Renewable Portfolio Standard (RPS)

New Hampshire's RPS, established in May 2007, requires electricity providers (excluding municipal utilities) to acquire renewable energy certificates (RECs) equivalent to 25.2% of retail electricity sales by 2025 (NH Department of Energy).

The RPS divides eligible resources into four classes:

• Class I: New renewable energy sources, including wind, solar, and certain biomass.
• Classes II, III, IV: Cover other resource types including existing hydro, thermal energy from certain sources, and methane.

The RPS indirectly supports heat pump adoption by driving utilities to procure cleaner electricity, reducing the grid's carbon intensity over time and encouraging electrification investments.

Net Metering

New Hampshire requires all retail electricity sellers to offer net metering to customers operating generation systems up to 1 MW in capacity (NH Department of Energy; RSA 362-A). Eligible generation technologies include solar, wind, geothermal, hydro, tidal, wave, biomass, landfill gas, bio-oil, and biodiesel. Combined heat and power (CHP) systems using natural gas, wood pellets, hydrogen, propane, or heating oil are also eligible.

Net metering is relevant for homeowners pairing a heat pump with rooftop solar, as excess generation can offset electricity costs, improving electrification economics. The NH Public Utilities Commission oversees the specific billing and crediting rules.

Recent Updates and Changes to NH Heat Pump Incentives (2023-2024)

Commercial and Industrial Renewable Energy Grants

The NH Department of Energy ran a competitive grant program for renewable energy projects at commercial, industrial, public, non-profit, municipal, school, and multi-family (3+ unit) facilities. The most recent funding round closed November 16, 2023 (NH Department of Energy, Commercial and Industrial Renewable Energy Grants).

The program is currently inactive for new applications. The NH Department of Energy advises contacting the Public Utilities Commission (PUC) regarding future funding rounds.

Federal IRA funding, including the HOMES Rebate Program (IRA §50122) and the High-Efficiency Electric Home Rebate Act (HEAR, IRA §50123), is rolling out across states. New Hampshire residents should monitor the NH Department of Energy for announcements on HOMES and HEAR program availability, as these could offer substantial point-of-sale rebates (up to $8,000 for heat pump HVAC under HEAR for income-qualifying households) in addition to existing state and utility programs.

Comparing New Hampshire Heat Pump Incentive Programs

Federal Tax Considerations

Heat pump rebates can provide significant federal tax benefits for both individuals and businesses under specific Internal Revenue Code (IRC) sections. Notably, IRC § 25C and § 25D offer credits for energy-efficient home improvements and clean energy installations, respectively.

• IRC § 25C: Provides a credit equal to 30% of the cost of qualifying heat pumps and heat pump water heaters, with an annual cap of $2,000, separate from the $1,200 general envelope cap.
• IRC § 25D: Offers a 30% uncapped credit for geothermal heat pumps (ground-source), encouraging the adoption of renewable energy technologies.
• Efficiency Standards: Equipment must meet the CEE highest-efficiency tier or be ENERGY STAR Most Efficient to qualify for these credits.
• Form 5695: Taxpayers must claim these credits on IRS Form 5695 when filing their tax returns.
• New Hampshire Considerations: While New Hampshire generally conforms to federal tax regulations, it's essential to verify any state-specific implications with a local CPA.

This is not tax advice — consult a CPA familiar with Heat pump rebates for your specific situation.

Available Rebates & Incentives

• Liberty Utilities (Gas) - Commercial Energy Efficiency Programs: Provides incentives for energy-efficient equipment installations for commercial natural gas customers. Eligibility includes various energy efficiency upgrades.
• Clean Energy Fund: Offers loans for energy efficiency and renewable energy projects for businesses, non-profits, and municipalities. Funding is subject to specific limitations.
• Eversource - New Hampshire Residential Clean Energy Loan: Provides 100% loan financing for heat pumps and battery energy storage systems for homeowners. Work must be performed by an approved contractor.
• Commercial & Industrial Renewable Energy Grants: Grants for renewable energy projects at commercial, industrial, and municipal facilities. Eligibility includes various forms of renewable energy.
• New Hampshire Electric Co-op - Residential Energy Efficiency Loan: Offers On Bill Financing Loans for weatherization projects under the NHEC Home Performance with ENERGY STAR program. Loans are available up to $4,000 at 0% interest.
• Unitil (Gas) - Residential Energy Efficiency Program: Provides home energy audits and rebates for energy efficiency improvements for residential gas customers. Rebates can cover up to 50% of qualifying improvements.

Federal Tax Deductions

The IRS offers several tax credits for energy-efficient home improvements, including the Energy Efficient Home Improvement Credit (IRS §25C), which provides a 30% credit up to $2,000 for qualifying heat pumps. Additionally, the HOMES Rebate Program and HEAR (High-Efficiency Electric Home Rebate) offer performance-based rebates for energy efficiency improvements, with specific income eligibility criteria. Consult a tax professional for personalized advice on maximizing these benefits.

Frequently Asked Questions

What types of financing options are available for heat pump installations in New Hampshire?

New Hampshire offers several financing options including low-cost loans from the NH Community Development Finance Authority, 100% financing through Eversource and NEIF, and on-bill financing from NH Electric Co-op.

How can I apply for the CDFA Clean Energy Fund loan?

You can apply for the CDFA Clean Energy Fund loan by contacting the NH Community Development Finance Authority directly at resources.nhcdfa.org for application materials and to confirm project eligibility.

Are there any federal tax credits available for heat pump installations in New Hampshire?

Yes, under IRS §25C, homeowners can receive a 30% tax credit up to $2,000 per year for qualifying heat pumps, which can be combined with state and utility programs.