Grand Rapids, MI 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
Grand Rapids, MI Heat Pump Load Calculator
Use our calculator below to estimate your home’s heating and cooling needs based on square footage. This tool uses ACCA-standard design conditions for Grand Rapids, MI: 91°F for cooling, -5°F for heating, and 72°F indoors. For a precise Manual J load calculation and personalized quote, connect with our 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
Grand Rapids, MI 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 Grand Rapids homeowners.
Michigan Home Energy Rebates
Up to $8,000The Home Electrification and Appliance (HEAR) program provides rebates to households installing heat pumps and other efficient equipment to help further electrify their homes. Maximum rebates include $8,000 for a heat pump for heating or cooling.
Consumers Energy Heat Pump Rebate
Varies by system typeConsumers Energy offers rebates on eligible furnaces, air conditioners, heat pumps and thermostats. Consumers Energy serves western and central Michigan, including Grand Rapids. Rebate programs for heat pumps are available, with amounts varying by system type (air-source, geothermal, ductless mini-split) and efficiency ratings.
Federal IRA Tax Credit
Up to 30% of costThe Inflation Reduction Act provides a federal tax credit for qualifying geothermal heat pump installations through 2032. Note: Federal tax credits for air-source heat pumps expired December 31, 2025.
Grand Rapids homeowners have access to active heat pump incentive programs in 2026. The Michigan Home Energy Rebates (MiHER) program offers up to $8,000 for heat pump installations, with priority for low- and moderate-income households. Additionally, Consumers Energy provides utility rebates for heat pump installations in the Grand Rapids area. For geothermal heat pumps, a federal tax credit of up to 30% of installation costs remains available through 2032. Palmetto can help homeowners navigate these programs and maximize 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
Grand Rapids sits in IECC Climate Zone 6, which means cold winters (design temps around -5°F) and warm summers (up to 91°F). This wide temperature range matters when sizing your heat pump—you need a system that can handle both extremes efficiently. At Palmetto, we understand Grand Rapids's climate and can help you choose the right heat pump 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
Grand Rapids Electricity Prices
Understanding electricity costs in Grand Rapids helps you make smarter decisions about home heating and cooling—especially as rates continue climbing.
Michigan residents pay 19.3 cents per kilowatt-hour in 2024, up from 17.5 cents in 2021. That's notably higher than the national average and means your heating and cooling bills are taking a bigger bite each year.
Heat pumps offer a practical response to rising rates. Because they move heat rather than generate it, they deliver 2-3 times more heating or cooling per unit of electricity compared to traditional systems—meaning lower bills even as rates increase.
Over a system's 15-20 year lifespan, this efficiency advantage compounds significantly. As electricity costs continue their upward trend, the gap between what you'd pay with a heat pump versus conventional heating widens in your favor.
Price of Energy: Michigan vs National Average
Grand Rapids Area Utility Providers
Grand Rapids residents are primarily served by two utility providers: Consumers Energy and Great Lakes Energy. According to 2023 data, Consumers Energy's rates averaged 18.8¢ per kWh, while Great Lakes Energy averaged 17.7¢ per kWh.
Both utilities' rates align closely with Michigan's state average of 18.80¢ per kWh, though they exceed the 2023 national average of 16.0¢ per kWh. This difference reflects Michigan's energy mix and infrastructure costs typical of Midwest utility markets.
While electricity rates in Grand Rapids run slightly above the national average, heat pumps can still lower your total energy spending. Their efficiency means they use less electricity to heat and cool your home compared to traditional systems—often cutting energy costs significantly.
Grand Rapids 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.
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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 sense in Grand Rapids. Modern cold-climate heat pumps work efficiently even at Grand Rapids' design heating temperature of -5°F, and they provide both heating and cooling for the area's 91°F summer days. With Michigan's electricity rate at 19.3¢ per kWh, heat pumps typically cost less to operate than traditional heating systems while keeping your home comfortable year-round.
Grand Rapids homeowners have flexible options to get started. Palmetto's Comfort Plan requires $0 upfront and includes all maintenance and repairs, making it easy to switch without financial stress. Alternatively, purchasing a heat pump outright may qualify you for up to $2,000 in federal tax credits under the Inflation Reduction Act, plus local rebates that further reduce costs.
Heat pumps perform very efficiently in Grand Rapids's Climate Zone 6, even during cold winters. Modern cold-climate heat pumps maintain strong performance down to -5°F and below, delivering 2-3 times more heating energy than they consume in electricity. This efficiency translates to lower energy bills compared to traditional furnaces, especially with Michigan's current electricity rate of 19.3¢ per kWh.
During Grand Rapids's moderate summers (reaching about 91°F), heat pumps also provide highly efficient cooling—often outperforming standard air conditioners. Year-round efficiency means consistent comfort and energy savings. Palmetto makes accessing this technology easy through our Comfort Plan with $0 upfront cost and included maintenance, or direct purchase options that may qualify for up to $2,000 in federal tax credits.
The choice between leasing and buying a heat pump in Grand Rapids depends on your financial priorities and homeownership plans. Buying outright means you own the equipment and can claim federal tax credits up to $2,000, while leasing through Palmetto's Comfort Plan requires $0 upfront and includes all maintenance and repairs for predictable monthly costs.
In Grand Rapids' Climate Zone 6, where winter temperatures drop to -5°F, heat pumps work year-round but require proper maintenance. If you prefer avoiding repair costs and maintenance responsibilities, leasing offers peace of mind. If you plan to stay long-term and want to maximize savings with tax incentives, purchasing may provide better value over time.
Heat pump installation costs in Grand Rapids typically range from $5,000 to $20,000 depending on your home's size, existing ductwork, and the system's heating capacity needed for Michigan's Climate Zone 6 winters. The total investment varies based on equipment efficiency ratings, installation complexity, and whether modifications to your home's electrical system are required.
Palmetto offers two flexible options to fit your budget: a Comfort Plan with $0 upfront cost 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 plus local Michigan rebates.
Yes, heat pumps are typically worth it financially in Grand Rapids. Modern heat pumps can reduce heating and cooling costs by 30-50% compared to traditional systems, even in Michigan's Climate Zone 6 where winter temperatures can drop to -5°F. With electricity at 19.3¢ per kWh, efficient heat pumps deliver more heating or cooling energy than they consume, lowering your monthly utility bills year-round.
The financial value improves further with flexible payment options. Palmetto's Comfort Plan requires $0 upfront and includes all maintenance and repairs, eliminating unexpected costs. If you purchase directly, you may qualify for up to $2,000 in federal tax credits under the Inflation Reduction Act, plus local rebates. Most Grand Rapids homeowners see the investment pay for itself through energy savings within 7-12 years.
Heat pumps in Grand Rapids are installed by licensed HVAC contractors who are experienced with Climate Zone 6 requirements, where systems must handle heating down to -5°F and cooling up to 91°F. Palmetto partners with qualified local installers to ensure your heat pump is properly sized and installed for Michigan's climate conditions.
Palmetto offers two installation options: a Comfort Plan with $0 upfront cost that includes all maintenance and repairs, 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 certified technicians who understand Grand Rapids' specific heating and cooling needs.
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 type of HVAC system that both heats and cools your home by transferring heat rather than generating it through combustion, making it highly efficient in Grand Rapids' Climate Zone 6 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 Michigan where electricity costs 19.3¢ per kWh—heat pumps can significantly reduce your energy bills. Palmetto makes installation accessible through our Comfort Plan with $0 upfront, or direct purchase options that may qualify for up to $2,000 in federal tax credits.