FOR IMMEDIATE RELEASE
October 3, 2025
Media Contact:
Tryn Brown
tbrown@buildingdecarb.org
Californians can save up to $7,700 on home energy upgrades before December 31
Eligible energy efficient home upgrade projects—including heat pump installations—can qualify for more than $3,200 in federal tax credits, plus thousands in additional savings through TECH Clean California incentives.
Sacramento, CA – California homeowners and renters have until December 31, 2025 to take advantage of thousands of dollars in federal tax credits for energy efficient home upgrades.
With the 25C Energy Efficient Home Improvement Credit and the 25D Residential Clean Energy Credit, California residents can save over $3,200 on qualifying home upgrades, including heat pumps for space and water heating, insulation, energy efficient doors and windows, solar panels, and battery storage. When combined with TECH Clean California incentives ranging between $1,000 and $4,000, residents can save up to $7,700 on new heat pump installations while incentives last.
“There’s no better time to upgrade your HVAC system with a modern, efficient heat pump,” said Evan Kamei, Program Director for TECH Clean California. “Heat pumps provide comfortable home heating and cooling, deliver cleaner indoor air, and reduce energy use for years to come. Right now, homeowners can combine federal credits with TECH Clean California incentives to maximize savings.”
Under the new Federal Administration, the 25C and 25D tax credits will expire on December 31, 2025. This means California residents have about three months to upgrade their home cooling, heating, and water heating systems with the following savings on heat pumps:
- Up to $2,000 covering 30% of new heat pump or heat pump water heater installations
- Up to $1,200 for home energy efficiency improvements, including insulation, electric panel upgrades, and energy audits
- 30% of renewable energy installation costs, such as solar, geothermal, and battery storage, with no lifetime cap
Residents can also combine federal tax credits with TECH Clean California statewide incentives while they last:
- Up to $4,000 for a new heat pump HVAC system and up to $5,700 for a new heat pump water heater
- Up to $6,000 for a new heat pump HVAC system or up to $7,700 for a new heat pump water heater when combining the above TECH Clean California incentives with $2,000 in federal tax credits
Heat pumps are a two-in-one appliance that delivers both heating and cooling in a single appliance. Because they are 3x more efficient than gas furnaces, they can help households save money on energy bills while also improving air quality and home comfort. That’s why 9 out of 10 heat pump owners say they would recommend them to others.
“Heat pumps for space and water heating keep homes comfortable year-round while also providing cleaner air, smart features, consistent temperatures, and the convenience of one appliance for both heating and cooling,” said Laura Wilson, Director of Marketing for The Switch Is On. “With demand rising, The Switch Is On is here to support residents with resources and help connect them with trusted contractors who can deliver these benefits.”
Homeowners who want to take advantage of these federal tax credits and incentives before the December 31, 2025 deadline can use The Switch Is On’s Incentive Finder and Contractor Finder tools to explore stackable incentives and rebates, compare savings, and find TECH Clean California-qualified contractors ready to install. Additionally, the Contractor Pro Network provides free leads, training, and resources to help contractors meet demand, expand their services, enroll in TECH Clean California, and build a reliable customer base in a competitive market.
By acting now, California residents can lock in big savings on modern electric appliances and start the new year with cleaner air, lasting energy efficiency, and year-round comfort.
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As part of the TECH Clean California initiative, The Switch Is On campaign provides consumer education to help homeowners, renters, and contractors access electrification resources. This statewide effort, powered by the Building Decarbonization Coalition, offers tools and information to electrify homes, promoting a cleaner, healthier lifestyle. Homeowners can take advantage of limited-time incentives and find pre-qualified, TECH-certified contractors through The Switch Is On website.
The TECH Clean California initiative is funded by California gas corporation ratepayers under the auspices of the California Public Utilities Commission. The TECH Clean California team is led by Energy Solutions and partners with Ardenna Energy, Association of Energy Affordability, Building Decarbonization Coalition, Central Coast, Energy Services, Inc., Electrify My Home, Frontier Energy, National Comfort Institute, Energy Outlet, Recurve Analytics, The Ortiz Group, Tre’ Laine Associates, and VEIC.