Heat Pump Water Heaters

Get instant savings by purchasing a clean, heat pump water heater.
A residential heat pump water heater

Heat pump water heaters are the most efficient way to heat water in a home—up to three times more efficient than conventional electric water heaters.

They work by extracting heat from the air surrounding the unit to heat water. These advanced systems are best suited for homes with basements or separate utility rooms (these units lose efficiency if installed in closets without proper clearance).

In addition to incentives, you can also take advantage of federal tax credits to further lower the price of purchasing and installing a heat pump water heater.

Rebates are available for residents replacing an existing electric, propane, natural gas, or oil water heater.

Heat Pump Water Heaters Rebates
Equipment Type Efficiency Requirements Rebate Amount Federal Tax Credit
Heat Pump Water Heater ENERGY STAR® certified UEF 3.30 $750 per unit Up to $2,000*
Heat Pump Water Heater (120volt/15amp circuit) ENERGY STAR® certified UEF 2.20 $750 per unit
Split-System Heat Pump Water Heaters ENERGY STAR® certified UEF 2.20 $1,500 per system

*25C Energy Efficient Home Improvement Credit. Disclaimer: This information does not represent tax or legal advice. Please consult your tax advisor for further details.  

 

Cost Example

Below is a cost example of installing a heat pump water heater.

Average Installation Cost* $3,200
Mass Save Rebate $750
Federal Tax Credit** $735
Net Project Cost $1,715

 

* Installed cost based on heat pump water heater vendor and contractor feedback.  

**25C Energy Efficient Home Improvement Credit. Federal tax credit is applied to install cost after the Mass Save rebate is applied. The 25C Tax Credit is equal to 30% of the heat pump water heater install cost after the Mass Save rebate is applied up to a total of $2,000 annually. The 25C Tax Credit also allows an annual credit up to $600 for electrical panel upgrades if they are installed in conjunction with a heat pump or heat pump water heater. For more information on available tax credits, please visit the Inflation Reduction Act FAQ. This information does not represent tax or legal advice. Please consult your tax advisor for further details.   ,

 

Related Rebates & Incentives

An energy efficient kitchen in Massachusetts

Case Study: All-Electric Home in Acton

When setting out to build a new home, Acton homeowners wanted a high level of energy efficiency and a low carbon footprint. With a ducted heat pump, heat pump water heater, solar array, and battery storage, these homeowners have an annual electric savings of 9,595 kWh.

Case Study: Drury Residence

A Greenfield homeowner received $10,000 in incentives after participating in a no-cost energy assessment and replacing his furnace and water heater with clean, efficient heat pump systems.