New Jersey Heat Pump Rebates & Incentives (2026)
New Jersey has some of the strongest heat pump incentives in the country in 2026. The statewide Whole Home program offers up to $7,500 in cash-back rebates, and all four electric utilities run their own programs on top. PSE&G's Building Decarbonization program adds up to $10,000–$12,000 for full fossil fuel displacement. Federal tax credits expired December 31, 2025. This guide covers all major New Jersey heat pump incentives available in 2026, including Whole Home, PSE&G, JCP&L, Atlantic City Electric, RECO, NJNG, and IRA program status. Here's what's actually available.
Updated July 20, 2026 · Last verified July 20, 2026 against official program sources
Rates and program availability may change after this date.
New Jersey
Open
New Jersey heat pump rebates are active through the statewide Whole Home program (up to $7,500 cash-back plus 0% financing) and all four electric utilities (PSE&G, JCP&L, Atlantic City Electric, RECO); ACE pays up to $2,000 for cold-climate heat pumps through December 31, 2026. Programs stack. Federal tax credits (25C/25D) ended December 31, 2025. The state's $185 million in IRA HEAR/HOMES funding has not launched consumer-facing programs as of July 20, 2026.
Sources:
The Short Version
✓ Whole Home: Up to $7,500 Cash Back
Offered through each NJ utility. Cash-back rebates scale with energy savings achieved (5–33% TES). Plus 0% financing up to $25,000.
✓ Utility Rebates: $300–$2,000
All four electric utilities (PSE&G, JCP&L, ACE, RECO) have active HVAC rebate programs. ACE pays up to $2,000 for cold-climate heat pumps through December 31, 2026. Stack with Whole Home. LMI adders available.
✓ Total Potential: $8,100–$9,500+
$8,100–$9,500 for typical above-150% AMI homeowners. PSE&G Building Decarb customers replacing gas can reach $17,500+ with Whole Home stacked.
✗ Federal Tax Credits Expired
Section 25C ($2,000) and Section 25D (30% geothermal) both expired December 31, 2025. No replacement legislation exists.
⚠ $185M IRA Funding Not Yet Launched
New Jersey received over $185 million for HEAR/HOMES rebates but has not launched consumer-facing programs. NJ's plan directs funds toward low-income households via M-RISE (multifamily) and a planned Comfort Partners electrification adder (CP-HEAR) rather than broad single-family rebates. Do not sign contracts contingent on HEAR funding.
Federal Tax Credits Have Ended
Section 25C (Energy Efficient Home Improvement Credit) and Section 25D (Residential Clean Energy Credit) both expired on December 31, 2025, under the One Big Beautiful Bill Act. Equipment must have been installed and operational by that date — a purchase contract alone does not qualify. For details, see our federal heat pump tax credit explainer.
NJ Whole Home Program: Up to $7,500 Cash Back
The NJ Whole Home Energy Efficiency Incentive Program (formerly Home Performance with ENERGY STAR) is the largest single incentive available statewide. Offered through New Jersey's regulated utilities and delivered by BPI-certified participating contractors, it provides cash-back rebates plus 0% interest on-bill financing for comprehensive home energy upgrades.
Rebates scale with projected Total Energy Savings (TES): $2,000 base at 5% TES, plus $200 per additional percentage point, up to $7,500 at 33% TES. Eligible measures include air-source and ground-source heat pumps, ductless mini-splits, heat pump water heaters, insulation, and air sealing. A home energy assessment is required, and all work must be performed by a BPI-certified contractor participating in your utility's program. No income requirements for eligibility. 0% financing up to $25,000 is available.
⚠ COOLAdvantage and WARMAdvantage Are Closed
The former direct rebate programs through njcleanenergy.com closed in 2021. HVAC equipment rebates are now administered by each utility, not through the centralized NJ Clean Energy website.
PSE&G — Standard + Building Decarbonization
PSE&G serves approximately 2.3 million customers in northern and central New Jersey. It offers both standard HVAC instant rebates and a separate Building Decarbonization program with significantly higher incentives.
Standard HVAC Instant Rebates
| Equipment | Rebate | Minimum Efficiency |
|---|---|---|
| ASHP — Tier 1 | $300 | SEER2 ≥ 15.2, EER2 ≥ 11.7, HSPF2 ≥ 7.8 |
| ASHP — Tier 2 | $450 | SEER2 ≥ 17.1, EER2 ≥ 11.7, HSPF2 ≥ 7.8 |
| Cold-climate ASHP | $600 | SEER2 ≥ 15.2, EER2 ≥ 10, HSPF2 ≥ 8.1, COP ≥ 1.75 at 5°F |
| Heat pump water heater | $450 | ENERGY STAR certified |
LMI customers receive an additional $300 per measure. Rebates are delivered as instant point-of-sale discounts through participating contractors.
Building Decarbonization Program (PSE&G Only)
PSE&G offers enhanced rebates for customers who fully replace fossil fuel heating with NEEP-listed cold-climate heat pumps. Requires ACCA Manual J load calculations and Manual S equipment selection.
| Incentive | Standard | LMI |
|---|---|---|
| Conversion rebate (largest system) | Lesser of $10,000 or 50% | Lesser of $12,000 or 60% |
| Decommissioning rebate | Up to $2,000 | Up to $2,000 |
| Re-ducting rebate (per Manual D) | Up to $2,000 | Up to $2,000 |
| Additional system rebates | $2,000 per additional ccASHP | $2,000 per additional ccASHP |
0% on-bill repayment — no credit check required — covers up to $25,000 standard plus an additional $50,000 for decarbonization projects ($75,000 total). If the account is closed for any reason, including a home sale, the unpaid balance is due to PSE&G within 30 days.
Partial-displacement paths also qualify: Dual Heat (keep the fossil fuel system, add a cold-climate heat pump with integrated controls) pays the lesser of $5,000 or 50% of project cost ($6,000 or 60% for LMI) plus up to $1,500 per integrated control unit (limit two). Hybrid Heat (replace the cooling system, keep existing heating) pays the lesser of $2,000 or 30% ($3,000 or 40% for LMI). Replacing a fossil fuel water heater with a heat pump water heater earns a $750 conversion rebate.
PSE&G Decarb + Whole Home = Strongest Stack in NJ
A PSE&G customer who fully replaces gas heating could receive $10,000+ from Building Decarb plus up to $7,500 from Whole Home — a realistic $17,500+ in combined incentives for a whole-home cold-climate heat pump project. This is among the best incentive stacks in any state.
Other Electric Utility Rebates
All four NJ electric utilities have active HVAC rebate programs that stack with Whole Home.
JCP&L (FirstEnergy) — Central & Western NJ
| Equipment | Rebate | Minimum Efficiency |
|---|---|---|
| Ducted ASHP — Tier 1 | $500 | SEER2 ≥ 15.2, EER2 ≥ 11.7, HSPF2 ≥ 7.8 |
| Ducted ASHP — Tier 2 | $750 | SEER2 ≥ 17.1, EER2 ≥ 11.7, HSPF2 ≥ 7.8 |
| Cold-climate ASHP (ducted) | $1,000 | SEER2 ≥ 15.2, EER2 ≥ 10, HSPF2 ≥ 8.1, COP ≥ 1.75 at 5°F |
| Ductless mini-split | $750 | SEER2 ≥ 17.1, EER2 ≥ 11.7, HSPF2 ≥ 7.8 |
| Heat pump water heater | $750 | ENERGY STAR certified |
LMI customers receive an additional $200 per unit. Rebates are post-installation, submitted via CLEAResult. 0% APR financing available through NEIF ($2,500–$25,000, 36–84 months).
Atlantic City Electric (Exelon) — Southern NJ & Shore
| Equipment | Rebate | Minimum Efficiency |
|---|---|---|
| ASHP split — Tier 1 | $500 | SEER2 ≥ 15.2, EER2 ≥ 11.7, HSPF2 ≥ 7.8 |
| ASHP split — Tier 2 | $750 | SEER2 ≥ 17.1, EER2 ≥ 11.7, HSPF2 ≥ 7.8 |
| Cold-climate ASHP (ducted or ductless) | $2,000 | SEER2 ≥ 15.2, EER2 ≥ 10, HSPF2 ≥ 8.1, COP ≥ 1.75 at 5°F |
| Geothermal heat pump | 50% of project cost, up to $10,000 | ENERGY STAR certified; replacing an electric heating system only |
| Ductless mini-split | $750 | SEER2 ≥ 17.1, EER2 ≥ 11.7, HSPF2 ≥ 7.8 |
| Heat pump water heater | $750 | ENERGY STAR certified |
LMI customers receive an additional $300 per qualified unit (geothermal excluded). The $2,000 cold-climate rebate is an enhanced limited-time amount available April 1 through December 31, 2026. NEIF 0% financing available up to $25,000.
Rockland Electric (RECO) — Bergen, Passaic & Sussex Counties
RECO's Clean Heat Program offers heat pump rebates with base incentives plus LMI adders for fuel-switching projects. 0% APR financing through NEIF ($2,500–$25,000), with 120-month terms for LMI households versus 84 months standard. Contact RECO directly for current rebate amounts.
NJ Natural Gas (NJNG) — Gas Utility
NJNG offers heat pump rebates through its SAVEGREEN® program: $500 (Tier 1) to $1,000 (cold-climate) for ASHPs and mini-splits, with a $300 LMI adder per qualifying unit. Its Building Decarbonization Hybrid Heating offer pairs a heat pump with gas backup and pays up to $2,000 for a single-zone system or up to $4,000 for a two-zone system. 0% on-bill repayment up to $25,000 is available; all loans are net of NJNG rebates. Current offers apply to qualifying equipment installed by June 30, 2027. South Jersey Gas and Elizabethtown Gas do not currently offer direct heat pump rebates.
IRA HEAR/HOMES Rebates: Funded But Not Launched
New Jersey received over $185 million from the DOE under the Inflation Reduction Act: approximately $91.6 million for HOMES (Home Efficiency Rebates), $91.3 million for HEAR (Home Electrification and Appliance Rebates), and $3.5 million for contractor training.
As of July 20, 2026, these programs have not launched. NJ's design directs funds toward low-income households through two planned programs: “M-RISE,” supporting whole-building efficiency projects in low-income multifamily housing, and “CP-HEAR,” an electrification adder to the existing Comfort Partners program — rather than broad single-family homeowner rebates.
How Programs Stack
NJ's incentive layers are explicitly stackable. Whole Home and utility HVAC rebates stack by design. Gas utility rebates (NJNG) stack where applicable. Scenarios below assume a $18,000 whole-home cold-climate heat pump installation.
Above 150% AMI — JCP&L or ACE Territory
- Whole Home cash-back (assuming ~25% TES): ~$6,000
- Electric utility cold-climate ASHP rebate: $1,000 (JCP&L) or $2,000 (ACE, through Dec 31, 2026)
- Federal tax credit: $0 (expired)
- HEAR: $0 (not launched)
Realistic maximum: ~$7,000–$8,000
Above 150% AMI — PSE&G Territory (Standard Rebate)
- Whole Home cash-back (assuming ~25% TES): ~$6,000
- PSE&G cold-climate ASHP instant rebate: $600
- NJNG SAVEGREEN (if applicable): up to $1,000
Realistic maximum: ~$7,600
PSE&G Building Decarbonization — Full Fossil Fuel Displacement (Best Case)
- PSE&G Decarb conversion rebate: up to $10,000
- Decommissioning + re-ducting: up to $4,000
- Whole Home cash-back (stacked): up to $7,500
Realistic maximum: ~$17,500–$21,500+
LMI customers qualify for $12,000 conversion cap instead of $10,000, plus $300 LMI adders on standard measures.
What You'll Actually Pay
For a $18,000 whole-home cold-climate system: most homeowners in JCP&L territory pay $11,000–$12,000 out of pocket; ACE customers pay $10,000–$11,000 while the $2,000 cold-climate rebate runs (through December 31, 2026). PSE&G standard customers pay $10,400–$12,000. PSE&G Building Decarb customers who fully displace fossil fuel may pay under $5,000 after all incentives. 0% financing stretches remaining costs over 7–10 years.
Income-Qualified Programs and Weatherization
Comfort Partners provides free energy efficiency improvements — including heating system repair or replacement, insulation, and air sealing — to households at or below 250% of the Federal Poverty Guidelines, or participating in federal/safety-net programs such as LIHEAP, SNAP, TANF, SSI, or Section 8. The program is active and fully available.
The Weatherization Assistance Program (WAP), administered by the NJ Department of Community Affairs for households at or below 200% FPL, covers insulation, air sealing, and heating system replacement (including heat pumps when cost-effective). Priority goes to seniors, individuals with disabilities, and families with young children.
✓ Best Candidates for a Heat Pump in New Jersey
PSE&G customers replacing gas or oil heating (Building Decarb + Whole Home = $17,500+). Homeowners with aging AC who need both heating and cooling replacement (dual-purpose value). Oil or propane customers in any utility territory (highest fuel cost savings). LMI households eligible for Comfort Partners (free) or enhanced utility adders.
Climate Context
NJ sits in ASHRAE climate zones 4A (central/southern) and 5A (northern). Modern cold-climate heat pumps maintain effective output well below 0°F — far colder than NJ experiences.
| Location | ASHRAE 99% Design Temp | Climate Zone |
|---|---|---|
| Newark | ~10°F | 4A |
| Trenton | ~10°F | 4A |
| Atlantic City | ~12°F | 4A |
| Sussex County (north) | ~5°F | 5A |
Natural gas is the dominant heating fuel (~72% of NJ households). Heat pumps offer the clearest savings for homes currently using fuel oil or propane. For gas-heated homes, the economics depend on local electricity and gas rates — but the heat pump's dual heating and cooling capability changes the comparison. For more on energy storage, see our home battery guide.
How to Apply
Schedule a Whole Home Energy Assessment
Contact your utility's Whole Home program — PSE&G: homeenergy.pseg.com or 1-855-846-2895; NJNG: savegreen.com; or your electric utility's efficiency site. A BPI-certified assessor will evaluate your home and identify eligible measures.
Check Your Electric Utility's Rebate Program
Visit your utility's energy efficiency website. PSE&G: homeenergy.pseg.com. JCP&L: residential.energysavenj.com. ACE: homeenergysavings.atlanticcityelectric.com. RECO: oru.com. Confirm current rebate amounts and equipment requirements.
Get Quotes From BPI-Certified Contractors
Whole Home requires a participating BPI-certified contractor. Get 2–3 quotes. Confirm the contractor is enrolled in both the Whole Home program and your utility's rebate program. For PSE&G Decarb, confirm Manual J/S requirements.
Choose Cold-Climate Equipment
Selecting a cold-climate heat pump (COP ≥ 1.75 at 5°F, NEEP Product List) unlocks the highest rebate tier at every NJ utility. Both R-410A and R-454B qualify if efficiency thresholds are met.
What to Watch
HEAR/HOMES Launch
NJ's $185 million in IRA rebate funding could add significant incentives for low-income and multifamily households when it launches. Watch the NJ BPU website for announcements.
IRA Funding Runway
Federal IRA rebate funding is available through September 30, 2031. The OBBBA did not repeal HEAR/HOMES allocations. However, political uncertainty and NJ's focus on multifamily housing may limit single-family impact.
Utility Program Renewals
NJ utility energy efficiency programs operate on multi-year triennium cycles approved by the BPU. Rebate amounts and program structures can change at renewal.
Frequently Asked Questions
What heat pump rebates are available in New Jersey in 2026?
The NJ Whole Home program offers up to $7,500 in cash-back incentives plus 0% financing. Each electric utility (PSE&G, JCP&L, Atlantic City Electric, RECO) offers additional HVAC rebates of $300–$2,000 depending on equipment efficiency, with ACE paying up to $2,000 for cold-climate heat pumps through December 31, 2026. PSE&G’s Building Decarbonization program offers up to $10,000–$12,000 for full fossil fuel displacement. These programs stack. Federal tax credits are not available for 2026 installations.
Can I stack NJ Whole Home rebates with utility rebates?
Yes. The NJ Whole Home program and utility HVAC equipment rebates are explicitly stackable. A homeowner can receive up to $7,500 from Whole Home plus $600–$2,000 from their electric utility, plus gas utility rebates where available (NJNG offers up to $1,000).
What is PSE&G’s Building Decarbonization program?
PSE&G offers enhanced rebates for customers who fully replace fossil fuel heating with cold-climate heat pumps. The conversion rebate is the lesser of $10,000 or 50% of project cost ($12,000 or 60% for LMI households). Additional rebates cover decommissioning (up to $2,000), re-ducting (up to $2,000), and extra heat pump units ($2,000 each). PSE&G also offers 0% on-bill repayment up to $75,000 with no credit check.
Has New Jersey launched the IRA HEAR/HOMES rebates?
No. As of July 2026, New Jersey has not launched consumer-facing HEAR or HOMES rebates. The state received over $185 million in IRA funding, but program design is still in progress. NJ’s plan directs funds toward low-income households through two planned programs — M-RISE (low-income multifamily housing) and CP-HEAR (an electrification adder to the Comfort Partners program) — rather than broad single-family rebates.
Do heat pumps work in New Jersey winters?
Yes. New Jersey’s winter design temperatures are around 10°F in Newark and Trenton. Modern cold-climate heat pumps maintain effective heating output well below 0°F. Every NJ utility rebate program includes a cold-climate tier with higher incentives for qualifying equipment.
What is the NJ Comfort Partners program?
Comfort Partners provides free energy efficiency improvements — including heating system repair or replacement — to income-eligible households. Eligibility is based on household income at or below 250% of the Federal Poverty Guidelines, or participation in federal/safety-net programs like LIHEAP, SNAP, or Section 8.
Sources
- PSE&G Whole Home Energy Solutions
- NJNG Whole Home Energy Solutions (TES rebate schedule)
- PSE&G HVAC Instant Rebates
- JCP&L HVAC Rebates (CLEAResult)
- Atlantic City Electric HVAC Program
- RECO Heat Pump Guide (NJ)
- NJ BPU — IRA HEAR/HOMES Funding ($185M)
- NJ Comfort Partners (Income-Eligible, via JCP&L)
- NJNG SAVEGREEN Heat Pump Rebates
- IRS — 25C/25D Expiration (OBBBA FAQ)
Disclaimer: This page covers the main statewide, utility, and IRA heat pump incentives available to New Jersey homeowners in 2026. It does not calculate savings, guarantee eligibility, or represent any incentive program. Utility rebate amounts differ by territory (PSE&G vs. JCP&L vs. ACE vs. RECO) and PSE&G Building Decarbonization incentives require full fossil fuel displacement and Manual J/S documentation. We verify status regularly but programs can change without notice. Always confirm current amounts and eligibility with your utility and your contractor before making decisions.
See how this state compares → Heat Pump Rebates by State (2026)