Loading NuWatt Energy...
We use your location to provide localized solar offers and incentives.
We serve MA, NH, CT, RI, ME, VT, NJ, PA, and TX
Loading NuWatt Energy...
Heat pumps in New Jersey cost $3,500–$22,000 before rebates depending on system type. After Whole Home rebates (up to $7,500) and utility rebates ($500–$1,400), your net cost drops to $0–$14,000. There is no federal tax credit in 2026.
Federal 25C Tax Credit: EXPIRED
The federal energy efficiency tax credit (Section 25C) expired December 31, 2025 under the OBBBA. $0 available for heat pumps in 2026. NJ state rebates (Whole Home) and utility rebates are now the only incentives. Do not let any contractor tell you otherwise.
Installed prices for New Jersey in 2026. Includes equipment, labor, permits, and standard installation. Prices shown before rebates.
| System Type | Price Range | Best For | Install Time | Notes |
|---|---|---|---|---|
| Ductless Single-Zone | $3,500–$7,000 | Single room, addition, or sunroom | 1 day | One indoor head + one outdoor unit. Ideal for older NJ homes without ductwork. |
| Ductless Multi-Zone (2-4 heads) | $8,000–$18,000 | Multi-story homes without ducts | 2-3 days | Popular for NJ colonials and Victorians where adding ductwork is impractical. |
| Ducted Central | $12,000–$22,000 | Homes with existing ductwork | 2-3 days | Replaces central AC + gas furnace. Most common choice for NJ gas-heated homes. |
| Hybrid (HP + Gas Backup) | $10,000–$20,000 | Northern NJ, keep gas as backup | 2-4 days | Auto-switches at balance point (~30-35 degrees F). Popular in Zone 5A. |
| Heat Pump Water Heater | $3,000–$5,000 | Replace electric or gas water heater | 0.5-1 day | Uses 60-70% less energy than electric resistance. Qualifies for utility rebates. |
One indoor head + one outdoor unit. Ideal for older NJ homes without ductwork.
Popular for NJ colonials and Victorians where adding ductwork is impractical.
Replaces central AC + gas furnace. Most common choice for NJ gas-heated homes.
Auto-switches at balance point (~30-35 degrees F). Popular in Zone 5A.
Uses 60-70% less energy than electric resistance. Qualifies for utility rebates.
Costs vary across NJ regions. Prices shown for a typical 3-ton ducted central system, installed.
Highest labor costs due to NYC proximity. PSE&G territory ($900 instant rebate).
Mix of PSE&G and JCP&L territory. Good contractor availability.
Coastal premium for salt-air corrosion-resistant outdoor units.
Most affordable NJ metro. ACE territory (up to $1,300 rebate). Milder Zone 4A.
NJ is a gas-dominant state
Most NJ homes heat with natural gas. Gas-to-heat-pump is the most common conversion, and these homes typically have existing ductwork in good condition, making ducted central systems the top choice.
Pricing scales with capacity. Use your home's square footage to estimate the right size and cost.
| Size (Tons) | BTU/hr | Home Sq Ft | Price Range | After ~$8,400 Rebates |
|---|---|---|---|---|
| 1 ton | 12,000 | 400-700 sq ft | $3,500–$6,000 | $0–$0 |
| 1.5 ton | 18,000 | 700-1,000 sq ft | $4,500–$8,000 | $0–$0 |
| 2 ton | 24,000 | 1,000-1,300 sq ft | $6,000–$11,000 | $0–$2,600 |
| 2.5 ton | 30,000 | 1,300-1,600 sq ft | $8,000–$14,000 | $0–$5,600 |
| 3 ton | 36,000 | 1,600-2,000 sq ft | $10,000–$17,000 | $1,600–$8,600 |
| 4 ton | 48,000 | 2,000-2,500 sq ft | $13,000–$21,000 | $4,600–$12,600 |
| 5 ton | 60,000 | 2,500-3,200 sq ft | $16,000–$25,000 | $7,600–$16,600 |
* Estimated rebates: $7,500 Whole Home + $900 PSE&G = $8,400. Your actual rebate depends on Total Energy Savings percentage and your utility. ACE and RECO customers may receive more.
Here is how rebates stack for a typical 3-ton ducted central system in PSE&G territory.
If HEAR launches (pending)
HEAR has NOT launched in NJ yet ($183M allocated, awaiting DOE approval). When it launches, income-qualified households could receive an additional $4,000–$8,000, dropping the net cost to $0–$2,600. Do NOT count on HEAR when budgeting today.
JCP&L Territory
$15,000 − $7,500 − $1,000
Net: $6,500
Cold-climate tier rebate
ACE Territory
$15,000 − $7,500 − $1,300
Net: $6,200
South NJ + lower labor
RECO Territory
$15,000 − $7,500 − $1,400
Net: $6,100
Highest utility rebate in NJ
Your utility rebate depends on where you live. These stack ON TOP of the Whole Home program.
North & Central NJ
Instant rebate on qualifying heat pumps. On-bill financing up to $75K.
Central & Western NJ
Tiered by efficiency: $500 Tier 1, $750 Tier 2/ductless, $1,000 cold-climate.
South NJ & Shore
HVAC Efficiency Program for central heat pumps and mini-splits.
Northwest NJ (Bergen/Passaic)
Heating/cooling efficiency rebate through Orange & Rockland.
Eight factors determine your final installed price. Understanding these helps you compare quotes accurately.
Ducted costs 2-3x more than single-zone mini-split. Hybrid adds gas integration.
Each additional ton adds $2,500-$4,000 installed. 2,000 sq ft home typically needs 3 tons.
Each additional indoor ductless head adds $1,500-$3,000 to the total.
Good ducts save $3,000-$7,000. Leaky or missing ducts push toward ductless.
Older NJ homes may need 200A panel upgrade ($1,500-$3,000). Required for larger systems.
Mitsubishi and Carrier premium; Daikin and Bosch mid-range; Goodman and Lennox entry.
Shore homes need corrosion-resistant coatings (+$500-$1,200) for salt-air protection.
NJ requires HVAC + electrical permits. Typically $150-$400, handled by installer.
Heat pump net cost (after ~$8,400 combined rebates) plus 10 years of operating costs vs. continuing with your current system. Based on a 3-ton ducted system at NJ average $0.26/kWh.
Gas-to-HP saves less annually but locks in electric costs and eliminates gas bill
14% less
Oil switchers see strong payback with rising oil prices
47% less
Propane is expensive in NJ and prices volatile
43% less
Electric baseboard is 3x more expensive to operate than a heat pump
60% less
NJ is gas-dominant — annual savings from gas are modest (~$250/yr), but oil, propane, and electric baseboard switchers save $1,150–$2,250/yr. The heat pump also provides AC in summer at no additional equipment cost.
Multiple 0% financing options are available to reduce upfront costs. Apply your rebates first, then finance the remaining balance.
Through NJ Clean Energy program. Must achieve minimum 5% Total Energy Savings.
Best for: Homeowners doing comprehensive upgrades
Repay through your PSE&G electric bill. Available to PSE&G customers only.
Best for: PSE&G customers wanting no-upfront-cost installation
Carrier, Daikin, Mitsubishi offer promotional rates through dealer networks.
Best for: Homeowners wanting brand-specific deals
NJ Housing and Mortgage Finance Agency energy efficiency loans.
Best for: Broader energy efficiency projects
At $37/month over 15 years at 0% interest through the Whole Home loan. Many NJ homeowners pay less than their previous monthly gas bill while paying off the system.
NJ spans two IECC climate zones. Northern NJ needs cold-climate models that cost more but perform better in harsh winters.
Camden, Cherry Hill, Atlantic City, Vineland
Newark, Morristown, Sussex, Paterson
The most-installed heat pump models in New Jersey, with installed pricing before rebates.
17.0 SEER2 / 10.0 HSPF2
Slim outdoor unit. R-32 refrigerant. Great humidity control for Shore.
18.5 SEER2 / 10.0 HSPF2
Quiet 56 dB. Compatible with most existing air handlers. JCP&L Tier 2 eligible.
22.0 SEER2 / 13.0 HSPF2
R-454B. Factory corrosion coatings for coastal. JCP&L cold-climate tier ($1,000).
18.0 SEER2 / 12.5 HSPF2
Maintains heating to -13 degrees F. Best ccASHP for Zone 5A. JCP&L $1,000 rebate.
17.5 SEER2 / 12.0 HSPF2
Heats to -15 degrees F. Strong NJ tri-state installer network. JCP&L $1,000 rebate.
Unique factors that affect heat pump costs in the Garden State.
NJ averages ~$9,500/year in property taxes. Energy cost savings have an outsized impact on NJ household budgets compared to most states. Every dollar saved on heating matters more here.
PSE&G raised rates 17% and JCP&L 20% in mid-2025. The average NJ rate is now ~$0.26/kWh. Even at this rate, a heat pump at COP 3.0 costs less per delivered BTU than gas, oil, or propane.
130 miles of coastline means outdoor units in shore communities need salt-air corrosion-resistant coatings, adding $500–$1,200. Carrier Coastal series models come with factory protection. Always verify coastal warranty coverage.
NJ requires a DCA (Department of Community Affairs) HVAC contractor license. Both HVAC and electrical permits are required. Municipal inspections are mandatory in most jurisdictions. Always verify your contractor holds a valid NJ DCA license.
Heat pump costs in New Jersey range from $3,500 to $22,000 before rebates depending on system type. A ductless single-zone mini-split costs $3,500-$7,000. A ductless multi-zone system (2-4 heads) runs $8,000-$18,000. A ducted central heat pump costs $12,000-$22,000. A hybrid system with gas backup costs $10,000-$20,000. After NJ Whole Home rebates (up to $7,500) and utility rebates ($500-$1,400), net cost drops to $0-$14,000.
The cheapest option is a ductless single-zone mini-split at $3,500-$7,000 installed. After the Whole Home rebate ($2,000-$7,500) and your utility rebate ($500-$1,400), a single-zone unit can cost as little as $0-$3,000 out of pocket. This is ideal for adding heating/cooling to one room, a sunroom, or a finished basement. For a whole-home solution on a budget, a ducted central system starts at $12,000 before rebates.
Stack all available incentives: (1) NJ Whole Home rebate up to $7,500 based on total energy savings percentage, (2) your utility rebate (PSE&G $900, JCP&L up to $1,000, ACE up to $1,300, RECO up to $1,400), (3) 0% financing through Whole Home or PSE&G on-bill repayment. If you are income-qualified, the upcoming HEAR rebates could add $4,000-$8,000 more. Get 3+ quotes to compare pricing.
No. The federal Section 25C energy efficiency tax credit expired on December 31, 2025, under the OBBBA signed July 4, 2025. There is zero federal tax credit for residential heat pump installations in 2026. NJ state rebates (Whole Home + utility) and the upcoming HEAR program are the remaining incentives.
NJ Whole Home is a performance-based rebate through NJ Clean Energy. You receive $2,000 at 5% projected Total Energy Savings, plus $200 for each additional percentage point, up to $7,500 at 33% TES. A heat pump installation with weatherization typically qualifies for $4,000-$7,500. The program also offers 0% interest loans up to $25,000.
HEAR (Home Efficiency and Electrification Rebates) is a federal program funded by the Inflation Reduction Act. NJ has $183 million allocated but the program has NOT launched yet — it is pending DOE approval and program administrator selection. When available, HEAR could provide up to $8,000 for low-income and $4,000 for moderate-income households. Do not count on HEAR when budgeting today.
RECO (Rockland Electric) offers the highest rebate at up to $1,400, but serves only a small area in northwest NJ. Atlantic City Electric offers up to $1,300 for South NJ homeowners. JCP&L offers up to $1,000 for cold-climate models. PSE&G provides a $900 instant rebate plus on-bill financing up to $75,000. Your rebate depends on which utility serves your address.
Yes. Modern cold-climate heat pumps (ccASHPs) from Mitsubishi Hyper-Heat, Fujitsu XLTH, and Carrier Greenspeed maintain rated heating capacity well below 0 degrees F. Northern NJ (Zone 5A) has winter design temps of 5-10 degrees F. Cold-climate models handle this easily. Many northern NJ homeowners choose a hybrid system with gas backup for extreme cold snaps, though modern cold-climate units rarely need it.
At the current NJ average electric rate of $0.26/kWh, a heat pump costs approximately $850 per year to heat a typical 2,000 sq ft home (at a seasonal COP of 3.0). This compares to $1,100 for natural gas, $2,200 for heating oil, $2,000 for propane, and $3,100 for electric baseboard. The heat pump also provides air conditioning in summer.
If your NJ home has existing ductwork in good condition from a central AC or gas furnace system, a ducted central heat pump ($12,000-$22,000) provides whole-home coverage. If you lack ductwork — common in older NJ colonials, Cape Cods, and row homes — ductless mini-splits ($8,000-$18,000 for multi-zone) are the better choice. Many NJ homeowners combine ducted main-floor systems with ductless units for bedrooms or additions.
Shore homes in Monmouth, Ocean, Atlantic, and Cape May counties need outdoor units with corrosion-resistant coatings for salt-air exposure. Carrier Coastal series and other coated models add $500-$1,200 to the cost. This premium protects the unit from premature failure. Choose a contractor experienced with coastal installations and ensure warranty coverage includes coastal environments.
A ductless single-zone mini-split takes 1 day. A multi-zone ductless system takes 2-3 days. A ducted central heat pump replacement takes 2-3 days. A hybrid system with gas integration takes 2-4 days. Add 1-2 days if electrical panel upgrades or ductwork modifications are needed. NJ requires both HVAC and electrical permits, which your contractor should handle.
Complete guide to Whole Home, utility rebates, HEAR status, and stacking strategies.
Read guideSide-by-side comparison for NJ gas-heated homes making the switch.
Read guideHow to verify DCA licenses, get competing quotes, and avoid costly installation mistakes.
Read guideAll New Jersey energy resources: solar, heat pumps, utility programs, and more.
View allEvery New Jersey home is different. Get an exact price for your home with Whole Home and utility rebates pre-applied — free, no obligation.
NJ DCA-licensed installers • 2,500+ installations • Serving NJ since 2008