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60% of Vermont homes burn fossil fuel for heat. Solar generates electricity. A heat pump consumes it instead of oil or propane. A GMP battery stores it for outages and peak hours. Together, they eliminate your fuel bills and maximize grid independence. Combined savings: $4,700+ per year.
~$4,700/yr
Combined Savings
solar + fuel switch
$2,200
HP Rebate (EVT)
ducted
Up to $10,500
GMP BYOD
battery incentive
~10 years
Combined Payback
with all rebates
Federal Tax Credits: 25D and 25C Both Expired
Section 25D (residential solar) and 25C (heat pump/efficiency) both expired December 31, 2025. There is $0 federal tax credit for homeowner purchases of solar or heat pumps. Vermont has no state solar rebate. EVT rebates and GMP programs are the primary remaining incentives.
Solar generates electricity. A heat pump converts it to heating and cooling at 3x efficiency. A battery stores it for peak hours and outages. Together they create a self-reinforcing system.
11,750
kWh/year produced
10 kW system in VT
4,200
kWh/year consumed
Heat pump (COP ~3.0)
7,550
kWh surplus
Offsets other usage + NM credits
60% of Vermont homes burn fossil fuel for heat — the highest rate in New England. Switching from oil/propane to a heat pump powered by solar is the biggest energy savings play available.
Heating Oil
~$3,800/yr
~700 gal at $3.96/gal (35% of VT homes)
Heat Pump
~$1,600/yr
~4,200 kWh at $0.2146/kWh (GMP rate + backup)
Annual Fuel Switch Savings
~$2,200/yr
Before solar. With solar offsetting HP electricity, effective heating cost drops near zero.
Solar charges the battery. Battery powers the heat pump during peak hours and outages. GMP dispatches stored energy to reduce grid stress. Everyone wins.
Lease Option
$55/mo
27 kWh total
BYOD Incentive
Up to $10,500
Deadline: 2026-09-30
TOU Arbitrage
~$800/yr
$0.1955/kWh spread
Every incentive available (and dead) for a solar + heat pump + battery bundle in Vermont. No surprises.
$2,200
Efficiency Vermont rebate for centrally ducted cold-climate heat pump. $475/head available for ductless mini-splits.
$2,000/condenser
Green Mountain Power income-qualified bonus. Available to households at or below 80% AMI. Stacks with EVT rebate.
Up to $10,500
Bring Your Own Device incentive for adding a battery to your solar system. $950/kW (4hr battery). Deadline: 2026-09-30. GMP customers only.
~$1,830+
Covers solar equipment, installation labor, and battery storage. Also applies to heat pump equipment. Automatic — no application.
~$400/yr
Solar systems under 50 kW exempt from property tax (32 V.S.A. §3802). Added home value from solar is not taxed.
$0
Expired December 31, 2025. No federal tax credit for homeowner solar purchases.
$0
Expired December 31, 2025. No federal tax credit for heat pumps, insulation, etc.
Solar (10 kW system)
~$29,400
Heat Pump (ducted)
~$16,000
Range: $12,000-20,000
GMP Battery (lease or BYOD net)
$55/mo lease or $0-$10,500 after BYOD
Total Before Rebates (solar + HP)
~$45,000-$55,000
Stacked Rebates & Savings
-~$7,700-$16,700
EVT ($2,200) + GMP income bonus ($2,000) + GMP BYOD ($10,500) + sales tax ($3,000+)
Solar Electricity Savings
~$2,500/yr
Self-consumption + NM credits at GMP rate
Fuel Switch Savings (Oil to HP)
~$2,200/yr
Oil at $3.96/gal vs HP at GMP rate (COP ~3.0)
Total Combined Savings
~$4,700/yr
Combined Payback Period
~10 years
Based on net cost after EVT rebate and combined annual savings. Improves significantly with GMP income bonus, BYOD incentive, or enhanced tier rebate.
The order matters for sizing accuracy, cash flow, and rebate timing. Here are the three approaches.
Reasons
Risks
Reasons
Risks
Reasons
Risks
Our Recommendation
Install the heat pump first if you are replacing a failing furnace or boiler. Otherwise, install both together for the best experience. Vermont's net metering rates have been declining for 7 consecutive years, and EVT rebate availability is not guaranteed indefinitely. Act sooner rather than later on both.
Vermont's electricity grid is approximately 95% carbon-free already, thanks to hydro, nuclear, wind, and solar. The RES (H.289) targets 100% by 2030 for large utilities and 2035 for all utilities. Electrification — switching from fossil fuel heating to heat pumps powered by this clean grid — is the final mile.
Grid Carbon Intensity
~95% Clean
Adding rooftop solar to an already-clean grid has less environmental impact than in coal-heavy states. The financial case for solar in VT rests on bill savings, not carbon reduction.
Fossil Fuel Heating
60% of Homes
This is where the real carbon reduction happens. Switching from oil/propane to a heat pump eliminates 2-4 tons of CO2 per household per year. Solar powers the heat pump with clean electricity.
A typical cold-climate heat pump in Vermont uses approximately 4,200 kWh per year for heating, assuming a COP of 2.5-3.0 and VT winter conditions (design temps -10 to -15F). A 10 kW solar system produces approximately 11,750 kWh/year in VT, more than enough to cover the heat pump electricity plus most of your existing household usage.
Yes. A 10 kW solar system in Vermont produces approximately 11,750 kWh/year. A heat pump uses about 4,200 kWh/year. That leaves approximately 7,550 kWh to offset other household electricity. With Category I net metering credits at $0.1439/kWh (effective after adjustor), excess production generates meaningful credits.
EVT rebates apply to the heat pump regardless of whether you have solar. Ducted: $2,200. Ductless: $475/head. GMP income bonus: $2,000/condenser (if income-qualified). Solar and heat pump rebates are entirely separate — installing both does not reduce either rebate.
GMP's battery program adds the third leg: solar generates electricity, battery stores it, heat pump uses it. During grid outages, the battery powers your heat pump. During peak hours (4-9 PM), the battery discharges when electricity is most expensive ($0.3407/kWh TOU rate). Lease: $55/mo. BYOD: up to $10,500 incentive. GMP customers only.
With a 10 kW solar system (~$30,500) and a ducted heat pump (~$16,000) minus EVT rebate ($2,200) and sales tax savings (~$3,000+), combined annual savings of approximately $4,700 (solar savings + fuel switch savings) yields a combined payback of roughly 10 years. Adding GMP BYOD incentive ($10,500 max) or income bonus ($2,000/condenser) can improve this significantly.
Vermont's grid is approximately 95% carbon-free already — one of the cleanest in the US. The environmental case for rooftop solar is smaller than in fossil-fuel-heavy states. However, the FINANCIAL case is strong: solar reduces your electric bill, and switching from oil/propane to a heat pump eliminates $2,200+/yr in fossil fuel costs. Electrification is the "final mile" of Vermont's clean energy transition.
We recommend installing the heat pump first (or both together). Installing the heat pump first lets you measure your actual electricity consumption so you can size solar accurately. If your furnace or boiler is failing, heat pump first is the clear choice. The EVT rebate is available now, and NM rates are declining annually, so there is urgency on both sides.
Full cost breakdown for the solar portion of your bundle.
Read guideEVT rebates and GMP income bonus guide.
Read guideLease, BYOD, and VPP details for the battery portion.
Read guideDetailed fuel switch savings analysis for Vermont.
Read guideSolar + heat pump is the most impactful energy upgrade for Vermont homeowners. NuWatt Energy designs, installs, and maintains complete electrification systems. EVT rebates, GMP battery programs, and net metering credits make 2026 the right time to act — especially with NM rates declining every year.