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34% of Connecticut homes still heat with oil — roughly 580,000 households paying $3.50/gallon. The typical CT homeowner spends ~$2,700/year on heating oil. A cold-climate heat pump cuts that to ~$1,200 — saving $1,500+ every year.
Last updated: February 2026
CT homeowners switching from oil to a cold-climate heat pump save approximately $1,500 per year in heating costs. Oil at $3.50/gallon costs ~$2,695/year for a typical home (770 gallons). A heat pump at $0.27/kWh (Eversource) with a COP of 3.0 costs ~$1,200/year for the same heating output — and provides air conditioning in summer at no additional equipment cost.
of CT homes still heat with oil
households on oil/propane statewide
average annual savings with a heat pump
Connecticut has one of the highest oil-heating rates in the nation. With volatile oil prices and generous Energize CT rebates up to $10,000, there has never been a better time for CT homeowners to make the switch to a heat pump.
Oil prices in CT have swung from $2.50 to $5.00+ per gallon in recent years. Heat pump operating costs are tied to electricity rates, which are far more stable and predictable.
Energize CT Energy Optimization rebates offer $1,000/ton (max $10,000) — among the most generous state heat pump rebates in New England. Standard rebates are $250/ton up to $2,500.
The CT Green Bank Smart-E Loan offers financing at 0.99% APR with terms up to 20 years. Your monthly payment is often less than what you currently spend on oil deliveries.
Connecticut summers are getting hotter. A heat pump replaces both your oil boiler and window AC units with a single, efficient system that heats in winter and cools in summer.
Oil at $3.50/gallon vs cold-climate heat pump at $0.27/kWh (Eversource CT, COP 3.0). All figures are annual operating costs — equipment costs not included.
| Home Size | Oil Usage | Oil Cost/Year | Heat Pump/Year | Annual Savings |
|---|---|---|---|---|
Small 1,200 sq ft | 500 gal | $1,750 | $810 | $940 |
Medium 2,000 sq ft | 770 gal | $2,695 | $1,200 | $1,495 |
Large 3,000 sq ft | 1,100 gal | $3,850 | $1,700 | $2,150 |
1,200 sq ft · 500 gal/year
2,000 sq ft · 770 gal/year
3,000 sq ft · 1,100 gal/year
Oil price: $3.50/gallon (EIA CT weekly average, February 2026). Heat pump assumes Eversource CT residential rate of $0.27/kWh and seasonal COP of 3.0. Oil furnace efficiency: 85%. Actual costs vary by home insulation, thermostat settings, and local utility rates. United Illuminating customers at $0.28/kWh see slightly higher heat pump costs but still save substantially vs oil.
Enter your current fuel type and annual usage to see how much you could save with a heat pump. The calculator uses current Connecticut fuel prices and heat pump performance data.
Current price: $3.50 $/gallon
Note: Connecticut does not have a special heat pump electric rate. Calculations use the standard residential rate for Eversource (~$0.27/kWh). CT rates are among the highest in New England.
Based on CT fuel prices as of February 2026 (oil $3.50/gal, propane $3.82/gal, gas $1.85/therm). Heat pump assumes COP 3.0 (cold-climate average). Electric rate based on Eversource at $0.27/kWh. Actual savings depend on home size, insulation, and usage patterns.
Once you are confident in your heat pump, removing the oil tank eliminates future leak risk, frees up space, and may be required when selling your home in CT.
The full process from assessment to completed installation takes 4-8 weeks. Here is each step with expected timelines for Connecticut homeowners.
Schedule a Home Energy Solutions assessment through Energize CT. A certified auditor evaluates your insulation, air sealing, and heating system. This assessment is heavily subsidized and often costs $50 or less for CT residents.
Your installer performs a Manual J load calculation to determine the exact heating and cooling capacity your home needs. This ensures proper sizing for Connecticut winters, which typically see lows around 5-10 degrees F.
Submit your rebate application through Energize CT. Standard rebates are $250/ton (up to $2,500). If you complete Home Energy Solutions and insulation first, you qualify for Energy Optimization rebates of $1,000/ton (up to $10,000).
Apply for a Smart-E Loan through the CT Green Bank at 0.99% APR for qualifying energy improvements. Terms up to 20 years. The loan covers heat pump installation, insulation, and oil tank removal in one package.
Professional installation of your cold-climate heat pump system. Ductless mini-splits take 1 day; ducted systems take 2-3 days. No ductwork needed for mini-splits. Most CT installers are familiar with oil-to-heat-pump conversions.
Licensed contractor removes the oil tank and performs soil testing if required. Indoor tank removal costs $500-$1,000; underground tanks cost $1,500-$3,000+ with soil remediation. CT DEEP regulates underground tank decommissioning.
Energize CT verifies the installation for rebate processing. Connecticut does not offer a special heat pump electric rate, but enrollment ensures you receive all applicable rebate payments and can track your savings.
Connecticut offers some of the strongest heat pump incentives in New England through Energize CT, the CT Green Bank, and upcoming federal programs.
The federal Section 25C energy efficiency tax credit (previously up to $2,000 for heat pumps) expired December 31, 2025. It is no longer available for any installations in 2026. Energize CT rebates, Smart-E Loans, and HEAR (when approved) are the remaining incentives for Connecticut homeowners.
Standard Path:
Energy Optimization Path:
The Energy Optimization path saves an additional $2,250 on a 3-ton system. If HEAR rebates become available, low-income households could reduce their net cost by an additional $8,000.
The Connecticut Green Bank's Smart-E Loan makes oil-to-heat-pump conversions affordable from day one with ultra-low interest rates.
APR for qualifying projects
maximum loan term
no down payment required
A $12,000 heat pump system after Energize CT Energy Optimization rebates of $3,000 (3-ton), financed at 0.99% APR:
Compare to ~$225/month in oil costs (770 gal/yr). Your heat pump payment + electric cost is often less than what you currently spend on oil alone.
Switching from oil to a heat pump reduces your carbon footprint significantly, even when accounting for electricity generation on the ISO New England grid.
Emitted by a typical oil-heated CT home (770 gal x 22.4 lbs CO2/gal)
Emitted by a heat pump using ISO-NE grid electricity (improving yearly as grid gets cleaner)
Per household — equivalent to removing a car from the road for 6 months
Note: As ISO New England adds more renewable energy to the grid, heat pump emissions continue to decrease. Connecticut has committed to 100% zero-carbon electricity by 2040. If you pair your heat pump with a solar system, your heating emissions can approach zero.
Complete guide to Standard and Energy Optimization rebates
Read guideFull cost breakdown by system type and home size
Read guideHow to vet contractors and get the best installation
Read guideNatural gas vs heat pump cost comparison for CT homes
Read guidePerformance data for Connecticut winter conditions
Read guideNortheast-wide guide with state-by-state incentives
Read guideNuWatt Energy helps Connecticut homeowners switch from oil to high-efficiency cold-climate heat pumps. With Energize CT rebates up to $10,000 and Smart-E Loan financing at 0.99% APR, the switch has never been more affordable. Get a free assessment today.