Lexington, KY Heat Pump Leasing & Installation
In this guide
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
Lexington, KY Heat Pump Load Calculator
Use our calculator below to estimate your home’s heating and cooling needs based on square footage. It’s calibrated to ACCA-standard design conditions for Lexington, KY: 72°F indoor, 92°F outdoor for cooling, and 5°F for heating. 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
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.
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Cash |
Loan |
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|---|---|---|---|
| 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
Local Incentives
Heat Pump Financing in Lexington
Unfortunately, there are currently no active heat pump rebate or incentive programs available to homeowners in Lexington, KY in 2026. The federal tax credits that were available through the Inflation Reduction Act expired on December 31, 2025, and Kentucky's Home Energy Rebates Program has not yet launched. However, Palmetto's Comfort Plan lease offers an alternative solution with $0 upfront cost, allowing homeowners to access efficient heat pump technology without waiting for future rebate programs or managing complex application processes.
Palmetto Comfort Plan: $0 Upfront Heat Pump Leasing
Even without local rebates, Palmetto's Comfort Plan makes upgrading easy. You get a high-efficiency heat pump installed with $0 upfront cost, predictable monthly payments, and all maintenance and repairs included for the life of the plan.
Incentive information is based on publicly available data as of 2026 and may change. Contact program administrators to verify current availability and eligibility requirements. Note: The federal Section 25C tax credit expired December 31, 2025 and is not available for installations in 2026.
04
Climate Zones
Lexington sits in IECC Climate Zone 7, which means cold winters that can dip to 5°F and hot summers reaching 92°F. This wide temperature swing matters—your heat pump needs to handle both extremes efficiently. At Palmetto, we understand Lexington's climate and help you choose a system sized right for your home. Explore other climate zones below or enter your ZIP code to confirm yours.
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
Lexington Electricity Prices
Understanding electricity costs in Lexington helps you make smarter decisions about home heating and cooling for the years ahead.
Kentucky electricity rates have climbed from 11.5 cents per kWh in 2021 to 13.0 cents in 2024—a 13% increase in just three years. While still below the national average, these rising costs impact your monthly energy bills.
Heat pumps offer a practical response to rising rates. Because they're 2-3x more efficient than traditional HVAC systems, they use significantly less electricity to deliver the same heating and cooling, helping offset increasing utility costs.
As electricity rates continue their upward trend, efficiency becomes increasingly valuable. A heat pump's lower energy consumption means you're better insulated against future rate increases, keeping more money in your pocket over the system's 15-20 year lifespan.
Price of Energy: Kentucky vs National Average
Lexington Area Utility Providers
Lexington residents benefit from competitive electricity rates. Kentucky Utilities (KU), the primary provider, charged 12.0¢ per kWh in 2023—well below both the state average of 12.70¢ and the national average of 16.0¢.
Kentucky's lower electricity costs stem from its diverse energy mix, including coal, natural gas, and hydroelectric power. This regional advantage, combined with KU's established infrastructure, helps keep rates affordable compared to other parts of the country.
These competitive rates make heat pumps even more attractive for Lexington homeowners. Heat pumps use electricity three times more efficiently than traditional heating systems, meaning lower rates translate directly into greater savings on your total energy bills year-round.
Lexington Utilities Electricity Rates
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
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.
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. |
Frequently Asked Questions
Yes, heat pumps make excellent sense in Lexington. With Climate Zone 7 temperatures ranging from 5°F in winter to 92°F in summer, modern heat pumps efficiently handle both heating and cooling needs year-round. Kentucky's electricity rate of 13.0¢ per kWh makes heat pumps cost-effective to operate compared to traditional heating systems.
Lexington homeowners can access heat pumps through Palmetto's Comfort Plan with $0 upfront and maintenance included, or through direct purchase to qualify for up to $2,000 in federal tax credits. Either way, you'll enjoy lower energy bills and reliable comfort in Lexington's variable climate without the complexity of separate heating and cooling systems.
Heat pumps perform very efficiently in Lexington's climate, which falls in Climate Zone 7 with winter temperatures typically around 5°F and summer highs near 92°F. Modern heat pumps can effectively heat and cool homes in this temperature range while using significantly less energy than traditional systems, helping homeowners save on Kentucky's 13.0¢ per kWh electricity costs year-round.
Because Lexington experiences moderate winters with occasional cold snaps, heat pumps work especially well here compared to colder climates. They transfer heat rather than generate it, making them 2-3 times more efficient than conventional heating systems. Palmetto offers heat pumps through both a Comfort Plan with no upfront cost and included maintenance, or direct purchase with potential federal tax credits up to $2,000.
The choice between leasing and buying a heat pump in Lexington depends on your financial priorities and homeownership plans. Palmetto's Comfort Plan offers $0 upfront with predictable monthly payments and included maintenance, while direct purchase means you own the equipment outright and may qualify for up to $2,000 in federal tax credits under the Inflation Reduction Act.
For Lexington's Climate Zone 7 conditions—with winter lows around 5°F and summer highs near 92°F—heat pumps work year-round, making both options worthwhile investments. Leasing suits homeowners who prefer no maintenance responsibilities and minimal upfront costs, while buying appeals to those who want to maximize long-term savings and benefit from available rebates at Kentucky's 13.0¢ per kWh electricity rate.
Heat pump costs in Lexington typically range from $5,000 to $15,000 for a complete installation, depending on your home's size, existing ductwork, and the system's efficiency rating. Climate Zone 7 conditions in Lexington—with winter lows around 5°F and summer highs near 92°F—mean you'll need a properly sized system to handle both heating and cooling demands year-round.
Palmetto offers two flexible options to fit your budget: a Comfort Plan with $0 upfront and predictable monthly payments that include 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. With Kentucky's electricity rate at 13.0¢ per kWh, an efficient heat pump can deliver significant long-term savings on your energy bills.
Yes, heat pumps are typically worth it financially in Lexington. Modern heat pumps can reduce heating and cooling costs by 30-50% compared to traditional systems, and with Kentucky's electricity rate at 13.0¢ per kWh, the savings add up quickly. Direct purchases may qualify for up to $2,000 in federal tax credits under the Inflation Reduction Act, plus local rebates.
Palmetto makes heat pumps financially accessible through two options: a Comfort Plan with $0 upfront cost and predictable monthly payments including all maintenance, or direct purchase for homeowners who want to own outright. Both options deliver long-term energy savings in Lexington's climate, where heat pumps efficiently handle both cold winters and warm summers year-round.
In Lexington, heat pumps are installed by licensed HVAC contractors who are trained to work with modern heating and cooling systems. Palmetto partners with certified local installers who understand Lexington's Climate Zone 7 requirements, where systems must handle winter temperatures around 5°F and summer highs near 92°F.
Palmetto offers two installation options: a Comfort Plan with $0 upfront cost and included maintenance, or direct purchase where you own the equipment and may qualify for up to $2,000 in federal tax credits. Both options include professional installation by experienced technicians who ensure your system is properly sized and configured for Kentucky's climate.
HVAC is an umbrella term that stands for Heating, Ventilation, and Air Conditioning—it describes any system that controls your home's temperature and air quality. A heat pump is actually a specific type of HVAC system that both heats and cools your home by transferring heat rather than generating it, making it highly efficient in Lexington's Climate Zone 7 conditions.
Unlike traditional HVAC systems that use separate furnaces and air conditioners, a heat pump handles both jobs with one unit. This efficiency matters in Kentucky where electricity costs 13.0¢ per kWh—heat pumps typically use less energy than conventional systems. Palmetto makes installation accessible through flexible options: a Comfort Plan with $0 upfront and included maintenance, or direct purchase with potential federal tax credits up to $2,000.