Maryland Heat Pump Leasing & Installation Guide
In this guide
From humid summers along the Chesapeake to colder winters in western Maryland, the state’s changing seasons call for home comfort that can adapt. Heat pumps provide efficient heating and cooling in one system, making them a smart option for many Maryland homes. Palmetto helps homeowners explore heat pump installation with clear guidance and trusted support, from choosing a system to planning the next steps.
01
Benefits of Palmetto Heat Pumps
Say goodbye to clunky old systems and surprise repairs. Palmetto Comfort Plan gives you a brand-new heat pump, installation, and full support, all wrapped into one subscription.
Year Round Comfort
A high-efficiency heat pump keeps your home cool in summer, warm in winter, and your energy use in check all year long.
Forget the maintenance
With a Comfort Plan subscription, installation and maintenance are fully covered, no surprise bills, no weekend DIY.
Rewards for renewing
Stick with us and earn credits toward your next system upgrade. It’s our way of saying thanks for building a cleaner, comfier future with us.
02
Buy it or finance it. Your comfort, your call
There’s no wrong way to get cozy. Here’s how the options stack up, so you can choose what works best for you.
|
|
Cash |
Loan |
|
|---|---|---|---|
| Payment schedule | $0 upfront, then monthly subscription | Full price upfront | $0 upfront, then monthly payment |
| Term length | 10 or 12 years | None | Variable |
| End of term options | Flexible with 25% renewal term credits to new system | No credits to new system | No credits to new system |
| Maintenance included | |||
| Eligible for incentives |
Cash
Loan
03
Maryland Heat Pump Rebates & Incentives
State and federal incentive programs can significantly reduce the cost of a new heat pump system. Here are the programs available to Maryland homeowners.
BGE Home Performance
Up to $15,000BGE offers modeled rebates for eligible home energy improvements, with a higher maximum when the project switches a combustion-fuel system to a qualifying electric heat pump.
Pepco Home Performance
Up to $15,000Pepco offers rebates for eligible home upgrades, including electrification projects that replace fossil-fueled HVAC or water-heating equipment with electric systems. Rebate reservations for the current offer must be made by December 31, 2026.
Delmarva Home Performance
Up to $15,000Delmarva Power offers modeled rebates for eligible home improvements, with a higher maximum when switching a combustion-fuel system to a qualifying electric heat pump.
Potomac Edison Home Performance
Up to $17,500Potomac Edison offers rebates for eligible home improvements, including HVAC upgrades, and additional incentives for switching fossil-fueled heating equipment to electric heat pumps. Qualified purchases through participating contractors are covered through December 31, 2026.
BGE Water Heater Rebate
Up to $1,600BGE offers rebates on select ENERGY STAR certified heat pump water heaters, with rebate options through participating contractors, retailers, and direct applications.
Pepco Water Heater Rebate
Up to $1,600Pepco offers rebates on ENERGY STAR certified heat pump water heaters through participating distributors, retailers, and rebate applications.
Delmarva Water Heater Rebate
Up to $1,600Delmarva Power offers rebates on ENERGY STAR certified heat pump water heaters, including instant discounts at select retailers.
SMECO Water Heater Rebate
$1,600SMECO offers a rebate on qualifying ENERGY STAR certified heat pump water heaters, with options through participating distributors, retailers, or an online application.
Potomac Edison Water Heater Discount
$1,250 – $1,500Potomac Edison offers discounts on qualifying ENERGY STAR certified heat pump water heaters. Switching from a fossil-fuel water heater may also qualify for additional electric make-ready assistance.
Maryland homeowners may qualify for active utility rebates on heat pump installations and heat pump water heaters, with amounts and requirements varying by utility and project. Some whole-home rebates require an energy assessment, an approved contractor, or a switch from fossil-fuel equipment. Palmetto can help homeowners identify eligible programs, apply, and maximize available incentives.
Incentive information is based on publicly available data as of 2026 and may change. Contact program administrators to verify current availability and eligibility requirements.
Maryland Electricity Prices
Maryland electricity prices have climbed in recent years, making how efficiently your home uses power worth a closer look.
Maryland’s average residential electricity price rose from 13.1 cents per kWh in 2021 to 17.9 cents in 2024—faster than the national average, which reached 16.5 cents.
Heat pumps can deliver two to three units of heating or cooling for each unit of electricity they use, helping meet home comfort needs with less power than traditional HVAC systems.
Over the life of a system, using less electricity for heating and cooling can help soften the impact of future rate increases. Actual savings depend on your home, equipment, and utility rates.
Price of Energy: Maryland vs National Average
Maryland Utility Providers
Maryland’s major electric utilities reported different average prices in 2023, the latest year available: BGE 16.47¢/kWh, Pepco 18.16¢, Potomac Edison 11.72¢, Delmarva Power 18.40¢, and SMECO 14.13¢. The state average was 16.60¢; the national average was 16.0¢.
Delmarva Power and Pepco were above both benchmarks. BGE was below the state average but above the national average, while SMECO and Potomac Edison were below both. The figures show utility-to-utility variation, but don’t explain its causes.
Even where electricity costs more, efficient heat pumps can help lower total energy spending compared with traditional HVAC. They use electricity to move heat rather than generate it directly, so a higher electricity rate alone doesn’t determine overall heating and cooling costs.
Maryland Utilities Electricity Rates
05
Maryland Heat Pump City Guides
Explore detailed heat pump installation guides for cities across Maryland. Each guide includes local utility rates, incentives, and climate-specific recommendations.
Frequently Asked Questions
Yes. Heat pumps generally work well across Maryland, where winters are cold but typically within the operating range of modern systems, and they also provide efficient air conditioning in humid summers. A properly sized unit, suited to your home’s insulation and layout, helps maintain comfort during colder periods and hot, muggy weather.
Maryland’s electricity price is currently 17.9¢ per kWh, so operating costs depend on equipment efficiency, your home, and usage. Palmetto’s Comfort Plan has $0 upfront cost, predictable monthly payments, and maintenance, repairs, and warranty coverage for the plan’s life. Direct purchase means owning the system and may qualify for state or utility rebates where available.
Heat pump costs in Maryland vary by system type and size, home layout, existing ductwork, and installation needs, so a personalized quote is the best way to estimate your total. With Palmetto, homeowners can choose a Comfort Plan with $0 upfront or buy the equipment with a one-time payment.
The Comfort Plan includes predictable monthly payments, maintenance and repairs for the plan’s life, and warranty coverage; direct buyers own the system and may qualify for state or utility rebates where available. Maryland electricity costs 17.9¢ per kWh. No federal heat pump tax credit is available for systems installed in 2026.
Strong heat pump brands for Maryland homes include Carrier, Trane, Daikin, Bosch, and Mitsubishi Electric. For homes with existing ducts, compare efficient variable-speed models from ducted product lines; Mitsubishi Electric and Fujitsu are also established choices for ductless systems. The right pick depends on home size, insulation, ductwork, and cold-weather performance—not brand name alone.
Maryland’s humid summers and winter cold snaps make proper sizing important; ask an installer to compare efficiency ratings and cold-climate output. At 17.9¢ per kWh, Maryland’s electricity price, efficiency can affect operating costs. Palmetto offers a Comfort Plan with $0 upfront and maintenance and repairs included, or direct purchase, which may qualify for state or utility rebates where available.
Yes. Maryland homeowners may be eligible for heat pump rebates through utility programs and state energy-efficiency offerings, but availability depends on your service area, equipment, household eligibility, and remaining funds. Check your utility and Maryland program administrators before installation, since requirements and rebate amounts can change.
A direct purchase may qualify for available state or utility incentives; confirm eligibility before choosing equipment. For a heat pump installed in 2026, federal 25C and 25D tax credits are no longer available. Palmetto’s Comfort Plan instead offers $0 upfront cost, predictable monthly payments, and maintenance and repairs for the plan’s life.
In Maryland, leasing through Palmetto’s Comfort Plan may suit homeowners who want to avoid a large upfront payment: it has $0 upfront cost, predictable monthly payments, and includes maintenance, repairs, and warranty coverage for the plan’s life. Buying requires a one-time payment but gives you ownership.
With electricity priced at 17.9¢ per kWh in Maryland, operating costs depend on your home, system, and usage. Direct-purchase owners may qualify for state or utility rebates where available. Federal heat pump tax credits ended for systems installed after December 31, 2025, so no federal credit applies to a 2026 installation.
A heat pump can be financially worthwhile in Maryland, but savings depend on your home, current heating fuel, equipment efficiency, and utility rates. At an electricity price of 17.9¢ per kWh, compare estimated heat-pump bills with the cost of your existing system. An installer can help estimate operating costs for your home.
Upfront costs and incentives also affect payback. A direct purchase gives you ownership and may qualify for state or utility rebates where available. Palmetto’s Comfort Plan has no upfront cost, predictable monthly payments, and maintenance and repairs included for the plan’s life. No federal heat-pump tax credit applies to systems installed in 2026.
Your Maryland home’s heat pump size should be based on a professional heating-and-cooling load calculation, not square footage alone. The calculation considers local winter and summer conditions, insulation, windows, air leaks, ceiling height, and ductwork. Correct sizing helps maintain comfort; an oversized unit may cycle too often, while an undersized one may struggle on extreme days.
Ask an installer to assess your home and ducts and compare equipment capacity at Maryland’s design temperatures, rather than choosing a model from a size chart. With electricity at 17.9¢ per kWh, an accurately matched, efficient system can help manage operating costs. Palmetto offers a $0-upfront Comfort Plan or direct purchase.