The program changed on September 1, and most NYC homeowners haven't heard about it. There's now a $3,000 difference between two otherwise identical heat pump installations — and it comes down to insulation. Here are the real numbers, the requirements nobody mentions until it's too late, and what you should do before January.
Con Edison Clean Heat pays NYC property owners to replace fossil-fuel heating with electric heat pumps. For a single-family home where the heat pump fully replaces the old system, the incentive is $7,000 at the standard rate and $10,000 in the new Weatherized Tier, rising to $8,000 and $11,000 in designated Disadvantaged Communities.
It's paid as a discount applied to your invoice by the installing contractor, not as a cheque you chase afterward. But there are three conditions that catch people out, and we'll get to those.
The federal residential energy efficiency tax credits ended December 31, 2025. That changes the math considerably: state and utility money is now the only meaningful incentive on a heat pump conversion in New York, which makes understanding this program worth more than it was a year ago.
These are the air-source heat pump rates for one- to four-unit buildings in Con Edison territory, which covers New York City and Westchester.
| Project | Standard | Weatherized |
|---|---|---|
| Single-family — full replacement | $7,000 | $10,000 |
| Single-family — Disadvantaged Community | $8,000 | $11,000 |
| Apartment — full replacement | $3,500 | $5,000 |
| Apartment — Disadvantaged Community | $4,000 | $5,500 |
| Single-family — partial, keeping fossil backup | $2,500 | — |
| Apartment — partial, keeping fossil backup | $1,000 | — |
Rates as published by Con Edison, verified October 2026. Incentives are capped at a percentage of project cost — confirm your project's cap before budgeting.
Ground-source heat pump installations run from roughly $25,000 to $40,000 at Con Edison depending on Disadvantaged Community status and tier, with the highest rates for whole-building systems. Geothermal is a much larger project with its own site constraints, but if your building can accommodate a loop field, the incentive reflects that.
Con Edison pays $1,300 for a qualifying heat pump water heater, and $1,500 for units purchased between September 1 and November 30, 2026. If you were considering replacing a gas or electric-resistance water heater anyway, that window closes at the end of November.
This is new as of September 1, 2026, and it's the single most important thing in the program right now.
Con Edison now pays two different rates for the same heat pump installation. A home meeting an insulation and air-sealing standard qualifies for the Weatherized Tier. A home that doesn't gets the standard rate. On a single-family whole-home conversion, that's a $3,000 difference — $10,000 against $7,000 — for identical equipment.
Which means the order of operations matters enormously. If your building needs insulation work, doing it before the heat pump install rather than after can be worth more than the insulation costs.
Con Edison states that an approved participating contractor determines which tier a project qualifies for. That means the contractor you choose has a direct effect on whether $3,000 lands on your side of the invoice — and whether anyone even raises the question with you before the job is specified.
The full incentive requires decommissioning and permanently disconnecting the existing fossil-fuel heating equipment. Keeping the boiler or furnace as backup is still eligible, but drops a single-family home from $7,000 to $2,500.
The project has to be submitted and approved before installation begins. Work that starts first is not eligible, and there is no retroactive application. This is the mistake that costs homeowners the whole incentive.
You cannot apply yourself. The application goes through an approved Con Edison participating contractor using the program's intake tool. If your contractor isn't in the program, the money isn't available on that job.
Larger buildings run on a different structure. Commercial and industrial electrification is paid per MMBtu of fossil-fuel heating displaced — in the range of $120 per MMBtu for full space heating conversion — capped at 50% of project cost and $1 million per account per year. Multifamily prescriptive rates are paid per dwelling unit.
For a property manager facing Local Law 97 compliance, this is worth modelling now rather than later. The capital cost of electrification is the same whenever you do it; the incentive isn't guaranteed to be.
We're a participating NYS Clean Heat contractor, so we handle the submissions rather than leaving you to chase them. But the honest part matters more than the paperwork.
A heat pump isn't right for every building. Electricity in New York is expensive, and whether a conversion saves you money month to month depends on your current fuel, your current equipment's efficiency, your building envelope, and how you use the space. When we quote a replacement we run both numbers — conventional equipment and a heat pump with incentives applied — and if the heat pump comes out worse for your building, we'll tell you that. The incentive doesn't change our answer.
We'll also check your electrical capacity before specifying anything. A heat pump adds load, and older buildings frequently need a panel or service upgrade to take it. That's a real cost, it's rarely mentioned in a sales pitch, and you should see it in the estimate rather than in a change order.
For a single-family home where the heat pump replaces the existing heating system, $7,000 at the standard rate and $10,000 in the Weatherized Tier, rising to $8,000 and $11,000 in Disadvantaged Communities. Apartments receive $3,500 standard and $5,000 weatherized. Keeping the old system as backup drops it to $2,500 for a single-family home.
A higher incentive rate that took effect September 1, 2026 for homes meeting an insulation and air-sealing standard. At Con Edison it's worth an additional $3,000 on a single-family whole-home conversion, and a participating contractor determines which tier a project qualifies for.
For the full incentive, yes. The higher rates require decommissioning and permanently disconnecting the existing fossil-fuel heating system. A partial conversion keeping the old system as backup is still eligible, but at a substantially lower amount.
No. The application has to be submitted by an approved participating contractor through the program's intake tool, and the project must be approved before any installation work begins. Work started before approval isn't eligible.
The federal residential energy efficiency tax credits ended December 31, 2025. State and utility incentives through NYS Clean Heat are now the primary funding source for heat pump conversions in New York.
Incentive amounts and program rules change. Figures verified October 2026 — we confirm what applies to your specific building at the time of quoting rather than relying on published rates.
We'll evaluate the system, check your electrical capacity, determine which tier your building falls into, and give you the conventional and heat pump numbers side by side with incentives applied.