New Jersey Heat Pump Rebates

What's available in New Jersey

New Jersey has one of the strongest heat pump incentive landscapes in the country in 2026, organized as a two-layer stack. The statewide Whole Home Energy Solutions program, administered through the utilities under NJBPU oversight, pays up to $7,500 based on energy savings achieved (capped at 50% of project cost), and each of the four major electric utilities (PSE&G, JCP&L, Atlantic City Electric, and Rockland Electric/RECO) layers its own heat pump equipment rebate on top, ranging from a few hundred dollars for a standard unit to $1,000-$2,000 for a cold-climate heat pump (Atlantic City Electric's $2,000 cold-climate promotion runs through June 30, 2027). Because the utility programs are territory-specific (homeowners qualify for exactly one), the realistic max stack for any single household is the statewide $7,500 plus their local utility rebate, roughly $8,100-$9,500 before financing; PSE&G and RECO also run separate full-electrification tracks worth up to $10,000 or 50% of cost. New Jersey Natural Gas customers can add a SAVEGREEN Hybrid Heat rebate of up to $2,000 (single zone) or $4,000 (two zones) for a heat pump paired with a gas furnace or boiler. The current utility program year runs through June 30, 2027; on July 15, 2026 NJBPU approved a one-year transition plan (July 1, 2027 through June 30, 2028) that cuts utility efficiency spending about 28%, so incentive levels may change after mid-2027. The federal §25C tax credit expired December 31, 2025 under the OBBBA and is unavailable in 2026, but state and utility rebates are unaffected. NJ's federal HEAR income-qualified program had no homeowner-facing launch announcement on the BPU or NJCEP sites as of September 2026; income-qualified adders of $300 per measure within the utility and NJNG programs are the main active income-qualified vehicle.

HEEHRA in New Jersey

HEEHRA rebate: Point-of-sale rebate up to $8,000 for households at or below 80% of area median income. Funded by the IRA, administered by each state. New Jersey is finalizing program rules.

How heat pump rebates work in New Jersey

New Jersey has one of the strongest heat pump incentive landscapes in the country in 2026, organized as a two-layer stack. The statewide program (renamed NJ Whole Home Energy Solutions, administered through the utilities under NJBPU oversight) pays up to $7,500 based on percent of modeled energy savings ($2,000 base at 5% modeled savings, rising to $7,500 at 33%), and each of the four major electric utilities layers its own equipment rebate on top: PSE&G's instant ASHP rebate is $300–$600 (with full-electrification conversions handled under a separate Building Decarbonization track worth up to $10,000); JCP&L pays up to $1,000; Atlantic City Electric runs a promotion (April 1, 2026 through June 30, 2027) lifting its cold-climate heat pump rebate to $2,000; and Rockland Electric/RECO pays up to $1,400. Because the utility programs are territory-specific (homeowners qualify for exactly one), the realistic max stack for any single household is the statewide $7,500 plus their local utility rebate. NJ's HEEHRA/HEAR income-qualified federal program appears to have begun opening in phases in 2026 (BPU received over $185M in DOE funding); confirm its status on the live NJCEP portal before relying on it. New Jersey Natural Gas SAVEGREEN also offers gas customers a Hybrid Heat rebate of up to $2,000 (single zone) or $4,000 (two zones) for a heat pump paired with a gas furnace or boiler, through June 30, 2027.

New Jersey rebate programs

5 utility-specific programs not shown here. Enter your ZIP in the calculator to filter to just your utility.

A worked example: whole-home install in Newark

Devon owns a 1,950 sq ft home in Newark served by PSE&G. His 26-year-old gas furnace and AC are end-of-life. He gets quotes for a 3-ton ducted cold-climate air-source heat pump (16 SEER2 / 9 HSPF2) installed for $13,800, modeled to achieve roughly 25% whole-home energy savings vs. the old gas system. Because the install qualifies under the statewide NJ Whole Home Energy Solutions program at 25% modeled savings, he receives roughly $6,000 (sliding scale between $2,000 at 5% and $7,500 at 33%). On top, as a PSE&G electric customer, he qualifies for PSE&G's instant point-of-sale cold-climate ASHP rebate at $600. The federal §25C credit is gone. Combined stack: about $6,600 against $13,800. Net out-of-pocket: roughly $7,200. If Devon instead pursued a full-electrification conversion, PSE&G's separate Building Decarbonization track (lesser of $10,000 or 50% of cost) could push his rebate much higher; he uses PSE&G's 0% on-bill repayment to finance the balance.

Choosing a contractor in New Jersey

New Jersey licenses HVAC contractors through the Division of Consumer Affairs Master Plumber and HVAC Contractor licenses. Verify at njconsumeraffairs.gov before signing. NJ Whole Home Energy Efficiency Program rebates require a BPI-certified contractor to perform the modeled-energy-savings calculation; the modeled savings determine the rebate amount on the sliding scale. PSE&G, JCP&L, Atlantic City Electric, and Rockland Electric each have their own approved contractor lists for the utility equipment rebate layer — confirm enrollment per utility. The PSE&G rebate is a point-of-sale instant rebate processed by the contractor at install.

Common pitfalls for New Jersey homeowners

• Stacking two utility equipment rebates. Each NJ electric customer is served by exactly one utility (PSE&G, JCP&L, Atlantic City Electric, or Rockland Electric). The four utility equipment rebates are mutually exclusive by territory — a homeowner cannot stack PSE&G and JCP&L rebates because they don't serve the same address. The statewide NJ Whole Home program is the rebate that stacks across utilities; the utility layer is one-per-household.
• Skipping the BPI-certified energy modeling. The NJ Whole Home Energy Efficiency Program rebate is determined by modeled energy savings, computed by a BPI-certified contractor using approved software (HEAT3D, REM/Rate, or equivalent). Without the modeling, the rebate defaults to the minimum tier. A contractor who can't or won't model the savings is not equipped to file the Whole Home rebate — find a BPI-certified contractor for this layer.

Estimate your net cost

How to claim each rebate

1. Get pre-approved (where required). Some utility programs require approval before install. Check program details before signing a contract.
2. Use a participating contractor. Many programs require a licensed installer from an approved contractor list — especially HEEHRA, which routes through CEC-approved contractors who process the rebate at point of sale.
3. Save documentation. AHRI certificate, model numbers, and itemized invoice are required for most utility rebates.
4. Submit utility rebate within 60–90 days of install. Some programs are first-come first-served and close mid-year — funding can run out before the calendar year does.

If you can't afford a replacement in New Jersey

Rebates lower the price, but they still assume you can pay the rest. If your heating system is unsafe or has failed and a new one is out of reach, these programs repair or replace equipment at low or no cost for income-qualified households. Heat Pump Pricing Index is an independent information site — we don't fund, discount, or install equipment — so these are the doors to knock on first:

• Weatherization Assistance Program (WAP). Free energy and health-and-safety repairs — an unsafe furnace is exactly the kind of problem it fixes — for households at or near 200% of the poverty line. Apply through your local community action agency: how to apply (energy.gov).
• LIHEAP. Heating-bill help plus, in most states, a crisis component for broken or dangerous heating equipment. Same local agency; New Jersey LIHEAP contacts.
• USDA Section 504 Home Repair. For homeowners outside cities: 1% loans up to $40,000, and grants up to $10,000 for homeowners 62 and older to remove health and safety hazards. Program page and state offices (rd.usda.gov).
• Your utility and 211. Most electric and gas utilities run an income-qualified assistance fund — call the number on your bill and ask. Dialing 211 reaches a local specialist who knows which agencies in New Jersey currently have funds.

Safety first: if a technician has told you a heat exchanger is cracked, stop using the furnace and make sure you have a working carbon monoxide detector before anything else.

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