Upgrade your water heater to save money

If your water heater is near the end of its useful life (e.g., 10-12 years old), you should consider replacing it with a heat pump water heater (HPWH).

The new HPWH will cost about $3,500 – $4,000, about $1500 – $2,000 more than a gas water heater (50-65 gallons). In addition, if you are replacing a gas or propane water heater, you will need a new 220 V circuit but probably not a panel upgrade. The new circuit will cost about $1,000.

Go here to search for your utility or local government rebates. The state tax credit for the homeowner is $170 (and up to $330 for the installer); the federal tax credit is 30% up to $2,000.

* To qualify for the state tax credit, the homeowner must choose a state-qualified installer.

In addition, if your household income is below 150% of the area median income (AMI) (which you can check here), the Colorado Energy Office will offer additional rebates for HPWHs through its Inflation Reduction Act funded Home Energy Rebate program.

Note that all these rebates and tax credits can be combined to help you pay for your HPWH project.

To find a qualified HPWH installer, go here