Nathan Healy
Certified by Nathan Healy
Updated: February 2026
Quality home solutions since 2011
Palmetto serves thousands of customers across 25 states with an over 85% approval rating

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

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

Forget the maintenance

With a Comfort Plan subscription, installation and maintenance are fully covered, no surprise bills, no weekend DIY.

Rewards for renewing

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

Denver, CO Heat Pump Load Calculator

Use our calculator below to estimate your home’s heating and cooling needs based on square footage. It uses ACCA-standard design conditions for Denver, CO: 91°F for cooling and -5°F for heating, with a 72°F indoor target. For a precise Manual J load calculation and personalized quote, connect with Palmetto’s team. Get in touch with our team for an official quote.

Step 1 of 3

Home location & size

Your home’s location and size directly impact heating needs.

Step 2 of 3

Home attributes

Step 3 of 3

Additional details

Description of what this means for context.

Estimated Heating Needs

Your home’s location falls within the a climate zone with the average extreme winter falling between 10° – 15° F.

Home Details

Get Started

Recommended equipment capacity

60,000 BTU

5 Tons

Calculated Cooling Mode

102,000 BTU

8.5 Tons

03

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
Payment schedule $0 upfront, then monthly subscription
Term length 10 or 12 years
End of term options Flexible with 25% renewal term credits to new system
Maintenance included
Eligible for incentives

Cash

Payment schedule Full price upfront
Term length None
End of term options No credits to new system
Maintenance included
Eligible for incentives

Loan

Payment schedule $0 upfront, then monthly payment
Term length Variable
End of term options No credits to new system
Maintenance included
Eligible for incentives

Local Incentives

Denver, CO Heat Pump Rebates & Incentives

Local and federal incentive programs can significantly reduce the cost of a new heat pump system. Here are the programs available to Denver homeowners.

Colorado HEAR Rebate

Up to $8,000

Home Electrification and Appliance Rebates (HEAR) support high-efficiency electric appliances and other upgrades, and are now available to single-family households through registered contractors. The rebates provide up to $14,000 in savings per qualified household to make eligible energy upgrades in single-family and manufactured/mobile homes.

Eligibility: Households must have incomes at or below 150% of the Area Median Income (AMI) in their county. Households with incomes below 80% of the Area Median Income (AMI) in their county are considered low-income, and households with incomes between 80% and 150% of the AMI in their county are considered moderate-income. You must reside in an existing home (new construction is ineligible) in Colorado for at least half of the year.

Learn more →

Colorado State Heat Pump Tax Credit

Up to $1,000

Beginning January 1, 2024, residents of Colorado are eligible for tax credits to install heat pumps for both space and water heating. In 2026 and after, the credit has been reduced to $1,000 for heat pumps. The credit is an upfront discount on installation through a registered contractor.

Eligibility: All Colorado residents, businesses, and other organizations who install an eligible heat pump through a registered contractor may receive a portion of the tax credit (at least 33.33%) as a discount at the time of installation. All heat pumps must be Energy Star certified. Air source heat pumps must be Air-Conditioning, Heating, and Refrigeration Institute (AHRI) 'matched' systems.

Learn more →

Power Ahead Colorado

Varies

The Power Ahead Colorado program was launched as part of a multi-pronged effort to help reduce greenhouse gas emissions caused by the heating and cooling of homes. The initiative will include $40 million for incentives for heat pumps, no-cost home upgrades for lower-income households, advisers to help homeowners decide if heat pumps are right for them, and money for getting the word out about Power Ahead.

Eligibility: The Denver Regional Council of Governments will use a $200 million federal grant to provide incentives for people to replace fossil-fuel-fired heating and cooling with heat pumps. Heat pump rebates offered by the state, Xcel and metro-area communities can be stacked with the incentives offered by Power Ahead.

Learn more →

Federal IRA Tax Credit

Up to $2,000

The Inflation Reduction Act provides a federal tax credit of up to $2,000 for qualifying heat pump installations through 2032.

Eligibility: Available to homeowners who purchase and install a qualifying heat pump system. Claimed on your annual federal tax return.

Learn more →

Denver homeowners have access to multiple heat pump rebate and incentive programs in 2026. The Colorado HEAR program offers up to $8,000 in rebates for income-qualified households (up to 150% of area median income), while the Colorado State Heat Pump Tax Credit provides up to $1,000 through registered contractors. Additionally, the new Power Ahead Colorado program, backed by a $200 million federal grant, offers $40 million in heat pump incentives for the Denver metro area. These programs can be combined with the federal IRA tax credit (up to $2,000) to maximize savings. Palmetto can help Denver homeowners navigate these programs, verify eligibility, and coordinate with registered contractors to ensure you receive all available rebates and 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.

04

Climate Zones

Denver sits in IECC Climate Zone 6, which means cold winters (design temps around -5°F) and warm summers (up to 91°F). This temperature range matters—your heat pump needs to handle both extremes efficiently. At Palmetto, we understand Denver's climate and can help you choose a system sized and selected for reliable year-round comfort. Explore other climate zones below, or enter your ZIP code to confirm yours.

US Climate Zone Map
Your location

Climate Zone 1

Climate zone 1 is not typically seen within the United States outside of Alaska. It represents the coldest climates on the planet.

Climate Zone 1A

Avg. extreme winters: -60° to -55° F

Climate Zone 1B

Avg. extreme winters: -55° to -50° F

05

Denver Electricity Prices

Understanding Denver's electricity costs is essential when choosing a heating and cooling system that protects your budget long-term.

Colorado electricity rates have climbed steadily from 13.1 cents per kWh in 2021 to 15.1 cents in 2024—a 15% increase in just three years, with no signs of slowing down.

Heat pumps offer a practical solution to rising rates. Because they're 2-3 times more efficient than traditional HVAC systems, they deliver the same comfort while using significantly less electricity per unit of heating or cooling.

As electricity costs continue rising, that efficiency gap becomes increasingly valuable. A heat pump doesn't just lower your monthly bills today—it provides lasting protection against future rate increases for years to come.

Price of Energy: Colorado vs National Average

10¢
20¢
30¢
13.7¢
13.1¢
15.0¢
14.2¢
16.0¢
14.3¢
16.5¢
15.1¢
2021
2022
2023
2024
US Average
Colorado

Denver Area Utility Providers

Denver residents are served primarily by two utility providers: Xcel Energy at 14.3¢ per kWh and CORE Electric at 14.5¢ per kWh (2023 data). Both rates sit comfortably below the national average of 16.0¢ per kWh.

Colorado's competitive electricity rates stem from the state's diverse energy mix, including natural gas, wind, and solar resources. Denver's utilities benefit from this balance, keeping costs roughly aligned with the state average of 14.30¢ per kWh while remaining more affordable than much of the country.

These below-average rates make Denver particularly well-suited for heat pumps. Because heat pumps use electricity three times more efficiently than traditional heating systems, you'll likely see lower total energy costs—even compared to natural gas heating in many cases.

Denver Utilities Electricity Rates

CORE Electric
14.50¢
-9%
Xcel Energy
14.30¢
-11%
CO Average
14.30¢
-11%
US Average
16.0¢
06

Palmetto Reviews

Ready to start saving with a heat pump?

Speak with a Palmetto heating & cooling expert to find out exactly how much you can save.

Get a Free Quote
Palmetto mobile app
07

Let our smart tools do the heavy lifting.

Get personalized tips, usage insights, project tracking, and that daily satisfaction of making your energy work smarter with the Palmetto mobile app.

  • Rewards for smarter energy usage
  • Energy insights & Dashboard
  • Personalized Savings Tools
  • Whole Home Energy Management
  • Support Whenever You Need It
Download the App
08

Repair versus replace

When a heat pump is in need of repair it is worth considering whether a replacement would be a better investment. While each case is unique, we generally recommend investing in a new unit when repairs exceed $5,000.

$5,000
Recommended repair threshold

A heat pump's lifetime is impacted by a number of factors including environment, use and the quality of the unit. It's important to choose the right unit for your climate zone and home's unique attributes.

When you are in need of repair, we recommend choosing a service provider that is an expert in the heat pump brand you have installed, and checking online reviews to ensure you are investing in the right level of service.

Potential repair Cost range Description
Capacitor Replacement $150 - $400 Common issue when unit struggles to start or makes a humming noise. Capacitors store the electrical energy needed to start the compressor and fan motors.
Refrigerant Recharge $250 - $750 Needed when the system loses cooling or heating efficiency due to low refrigerant levels. Includes leak detection, repair of minor leaks, and recharging the system to the manufacturer-specified level.
Reversing Valve Replacement $450 - $900 Required when the unit cannot switch between heating and cooling modes. The reversing valve directs refrigerant flow and is unique to heat pump systems.
Compressor Replacement $1,500 - $3,000 Major repair needed when the unit fails to heat or cool entirely. The compressor is the heart of the system, circulating refrigerant between the indoor and outdoor coils.
Evaporator/Condenser Coil Replacement $1,200 - $2,800 Replacement needed when coils develop leaks or corrosion that cannot be economically repaired. Coil damage reduces heat transfer efficiency and can cause refrigerant loss.
Control Board Replacement $500 - $1,200 Required when the system has electrical failures or erratic behavior. The control board manages all system operations including defrost cycles, fan speeds, and compressor staging.
Full System Replacement $4,500 - $8,000+ When repairs exceed the value of the unit or multiple major components fail simultaneously. Includes removal of the old system and installation of a new heat pump with updated refrigerant lines and electrical connections.

Ready to start saving with a heat pump?

Speak with a Palmetto heating & cooling expert to find out exactly how much you can save.

Get a Free Quote
09

Frequently Asked Questions

Yes, heat pumps make sense in Denver. Modern cold-climate heat pumps work efficiently even at Denver's design heating temperature of -5°F, and they provide both heating and cooling for the city's 91°F summer days. With Colorado's electricity rate at 15.1¢ per kWh, heat pumps typically cost less to operate than traditional heating systems while keeping your home comfortable year-round.

Denver homeowners have flexible options for heat pump installation. Palmetto's Comfort Plan offers $0 upfront with maintenance included, ideal if you prefer predictable monthly costs. Direct purchase lets you own the equipment outright and potentially qualify for up to $2,000 in federal tax credits under the Inflation Reduction Act, plus local rebates to reduce your initial investment.

Heat pumps perform remarkably well in Denver's Climate Zone 6, even when temperatures drop to the design heating temperature of -5°F. Modern cold-climate heat pumps maintain efficiency ratings of 200-300% (meaning they produce 2-3 units of heat for every unit of electricity consumed), making them significantly more efficient than traditional electric resistance heating, even in Colorado's cold winters.

With Colorado's electricity rate at 15.1¢ per kWh, heat pumps typically cost 30-50% less to operate than gas furnaces or baseboard heaters for heating your home. Their efficiency also works during Denver's summer months, cooling your home effectively when temperatures reach 91°F while using less energy than conventional air conditioning systems, providing year-round comfort and savings.

The choice between leasing and buying a heat pump in Denver depends on your financial priorities and homeownership plans. Buying outright means you own the equipment and can claim up to $2,000 in federal tax credits under the Inflation Reduction Act, plus local rebates. Leasing through a Comfort Plan requires $0 upfront and includes all maintenance and repairs for the life of the plan.

Denver's Climate Zone 6 conditions mean your heat pump will work year-round, from -5°F winter nights to 91°F summer days. With electricity at 15.1¢ per kWh, both options deliver efficient heating and cooling. Consider buying if you want to maximize incentives and plan to stay long-term, or leasing if you prefer predictable costs without maintenance concerns.

Heat pump installation costs in Denver typically range from $5,000 to $20,000 depending on your home's size, existing infrastructure, and the system's capacity needed for Colorado's Climate Zone 6 conditions (where winter temperatures can drop to -5°F). The final price depends on factors like ductwork modifications, electrical upgrades, and the specific heat pump model suited for Denver's climate.

Palmetto offers two payment options to fit different needs: a Comfort Plan with $0 upfront cost and a predictable monthly payment that includes all maintenance and repairs, or direct purchase where you own the equipment outright and may qualify for up to $2,000 in federal tax credits under the Inflation Reduction Act plus local rebates. Both options provide quality heat pump solutions designed for Denver's heating and cooling demands.

Yes, heat pumps are typically worth it financially in Denver. Modern heat pumps can reduce heating and cooling costs by 30-50% compared to traditional systems, and with Colorado's electricity rate of 15.1¢ per kWh, most homeowners see meaningful savings on their monthly energy bills within the first year of operation.

The financial picture becomes even more attractive when you consider your options. With direct purchase, you can claim up to $2,000 in federal tax credits under the Inflation Reduction Act plus local rebates. Alternatively, Palmetto's Comfort Plan offers $0 upfront cost with a predictable monthly payment that includes all maintenance and repairs—letting you start saving immediately without a large initial investment.

Heat pumps in Denver are installed by licensed HVAC contractors who specialize in heating and cooling systems suitable for Colorado's Climate Zone 6 conditions. These professionals must understand how to properly size and install systems that can handle Denver's -5°F winter design temperatures and 91°F summer peaks while maximizing efficiency with electricity costs at 15.1¢ per kWh.

Palmetto offers professional heat pump installation in Denver through two flexible options: a Comfort Plan with $0 upfront cost and all maintenance included, or direct purchase where you own the equipment outright and may qualify for up to $2,000 in federal tax credits. Both options include expert installation by qualified technicians who ensure your system is optimized for Denver's unique climate demands.

A heat pump is actually a type of HVAC system. HVAC stands for Heating, Ventilation, and Air Conditioning—it's an umbrella term for any equipment that controls your home's temperature and air quality. Heat pumps are unique because they both heat and cool your home using the same system, transferring heat rather than generating it through combustion.

In Denver's Climate Zone 6, where winter temperatures can drop to -5°F, modern heat pumps are designed to handle both extreme cold and summer highs of 91°F efficiently. Unlike traditional HVAC systems that use separate furnaces and air conditioners, a single heat pump does both jobs while typically using less energy at Colorado's current electricity rate of 15.1¢ per kWh.