Rebates by state / Montana

Montana HVAC rebates 2026: the federal program is paused — here is what pays now

By Ionel Glogoveanu, editor. Every figure on this page was checked against the official source on the date shown.

Montana has not launched its federal home energy rebates: the Department of Environmental Quality (DEQ) paused planning in February 2025 and needs final federal approval to launch. What pays now comes from utilities: NorthWestern Energy pays $450 for a qualifying ducted or ductless heat pump and up to $3,000 off a heat pump water heater installed by a participating contractor; Montana-Dakota Utilities pays $300 for a 95% gas furnace but nothing for heat pumps; and Bozeman adds $500 for a heat pump water heater. No federal or Montana tax credit covers 2026 work.

Every Montana program at a glance

HEEHR and HOMES in Montana: paused since February 2025

DEQ’s Energy Bureau runs Montana’s two federal rebate programs: HOMES, which pays by the energy a whole-house project saves, and HEEHR — still called HEAR in most guides — which pays point-of-sale rebates to households up to 150% of area median income. Its own timeline explains why neither exists yet. DEQ received planning funds in October 2023, chose a design and implementation contractor in July 2024, submitted its implementation application in November 2024 and received a conditional award in January 2025, but it cannot touch those funds until DOE approves the application, which sits in “pended” status. Design work paused in February 2025 so DOE could rewrite its guidance. DOE issued an initial revised overview on June 1, 2026; once the details follow, DEQ will revise and resubmit its application and launch only after final approval. No date has been announced, and DEQ’s program FAQ, citing DOE, says the law does not authorize rebates for work done before a program is running. You can sign up for DEQ’s updates.

Are there federal rebates for HVAC in Montana in 2026?

Almost none reach a Montana homeowner this year. The two federal tax credits that paid for heat pumps, furnaces, insulation and geothermal systems — 25C and 25D — ended for anything placed in service after December 31, 2025. A 2025 installation can still be claimed on a 2025 return, and extended 2025 returns are due October 15, 2026. The federal HEEHR and HOMES rebates are real money set aside for Montana, but they reach homeowners only through DEQ’s program, which has not launched. The one federally funded program working today is the Weatherization Assistance Program, which helps income-qualified households improve the heating efficiency of their homes; in Montana it is run by the Department of Public Health and Human Services through local offices, and eligibility depends on household size and income. Everything else a Montanan can claim for an HVAC project in 2026 comes from a utility, a cooperative or a city.

NorthWestern Energy: $450 for a heat pump, on a new form since August 1

NorthWestern Energy pays its residential electric customers $450 for each central heat pump, ducted or ductless, under its existing-home form 3743. The equipment must be ENERGY STAR rated or reach at least SEER2 15.2 and HSPF2 8.5. The current form took effect on August 1, 2026, and its dates matter: work completed or materials bought before August 1 are not accepted, and projects must be completed and submitted by June 30, 2027. A heat pump installed in July 2026 therefore falls outside this form — ask NorthWestern before assuming it qualifies. New construction and garages do not qualify, self-installers may apply, and the application needs an itemized invoice and a recent bill for the address. NorthWestern may inspect the work, pays in four to six weeks, and funds are first come, first served. The same form pays $70 for a thermostat in electrically heated homes, $80 for an ENERGY STAR clothes washer and $100 for an air purifier. Questions: 800-823-5995.

The biggest Montana incentive: up to $3,000 off a heat pump water heater

NorthWestern Energy’s heat pump water heater program, run with Evergreen Energy Partners, is the largest incentive most Montanans can claim this year: up to $3,000, applied as an instant discount on the materials and installation. It works only through a participating contractor who has completed NorthWestern’s training; the contractor submits an eligibility form, gets an answer within three business days, installs, and then files for payment. Only Tier 3 or Tier 4 units on the Northwest Energy Efficiency Alliance’s qualified products list are eligible. The City of Bozeman describes the offer as replacing an old electric water heater with a heat pump model. One detail homeowners rarely see: the program also pays the installer $500 for each qualifying installation, on top of your discount — reasonable, but a reason to compare quotes. NorthWestern calls the program limited-time and publishes no end date. Its participating contractor list was updated in September 2026.

NorthWestern natural gas customers: insulation pays by the square foot

If NorthWestern delivers your natural gas, its insulation form 3747 pays by the square foot for work done from August 1, 2026 and completed and submitted by June 30, 2027: $0.55 to take an uninsulated attic (R-0) to at least R-49, or $0.45 if it already has some insulation, up to R-11; $0.60 to insulate basement or crawlspace walls, including the rim joist, to R-19; and $0.55, $0.85 or $0.95 for floors over unheated space insulated to R-19, R-30 or R-38. On 1,000 square feet of bare attic, that is $550, never more than you paid. One group is excluded: former Energy West Montana and Cut Bank Gas customers, whose rates do not fund these programs. Insulating first also matches the federal HEEHR rule. NorthWestern also has natural gas forms for furnaces and boilers; we did not re-read their amounts, so check its rebate page. More in our insulation rebates guide.

Montana-Dakota Utilities: a furnace rebate, no heat pump rebate

Montana-Dakota Utilities’ residential programs in Montana, on a page updated April 1, 2026, are narrow. Natural gas customers who replace a furnace with one rated 95% AFUE or higher get $300; fuel conversions and new construction do not qualify. A basic programmable thermostat earns $15 when a heating contractor installs it with a qualifying furnace, and a Wi-Fi thermostat $60 on its own. Electric customers can claim half the price of LED bulbs, up to $5 or $7 per bulb and 40 bulbs per account. Montana-Dakota pays by check in four to six weeks, funds each program on a plan year that runs from March 1 to February 28, and stops paying when a year’s money runs out. There is no heat pump rebate on its Montana page, so a Montana-Dakota customer switching to a heat pump gets nothing from the utility today — and a home switching from gas cannot count on HEEHR either, under the federal rule in force since May 29, 2026.

Bozeman: $500 more for a heat pump water heater

The City of Bozeman pays $500 to its water customers who install a new electric heat pump water heater from the NEEA qualified products list, plus $75 for completing a satisfaction survey afterward. The unit must be installed before you apply; an optional pre-application confirms the money is there and the model qualifies. Renters need a letter of approval from the owner, and buildings with four or more units must contact the city first. The city states that its rebate can be combined with NorthWestern Energy’s, so a Bozeman household replacing an electric water heater through a participating contractor can collect both — up to $3,500 on one appliance. Bozeman runs the rebate as a pilot that informs DEQ’s planning for statewide programs. One stale line remains in the city’s FAQ: it points readers to the federal ENERGY STAR water heater tax credit, which ended for equipment installed after 2025. Other cities and counties, including Missoula County, advertise their own rebates; we have not re-read them.

Montana tax credits: the energy credits older guides list are gone

Older guides still list Montana energy tax credits. The Department of Revenue says the Energy Conservation Installation Credit — the one that covered efficient heating and cooling systems, insulation and similar upgrades — was repealed by the 2021 Legislature and cannot be claimed after tax year 2021, and the Montana Code lists the credit for installing an alternative energy system, such as solar, as repealed. On the federal side, 25C and 25D ended for work placed in service after December 31, 2025. So a heat pump, furnace, insulation job or solar array installed in Montana in 2026 earns no income tax credit from either government. Older guides also cite a state geothermal credit; we could not confirm its status on an official page today, so ask a Montana tax preparer before counting on it. What remains is financing: DEQ’s Alternative Energy Revolving Loan Program makes low-interest loans for alternative energy systems and energy conservation measures. For solar, that loan is what is left.

How a Montana rebate is paid: three different ways

The programs above pay in three ways, and knowing which one you are in saves a lost rebate. NorthWestern’s electric and gas forms, and Montana-Dakota’s, are mail-in rebates: you buy, install and then apply with an itemized invoice and a recent bill, and a check arrives in four to six weeks if the money has not run out. NorthWestern’s heat pump water heater incentive works the other way round: a participating contractor confirms eligibility before the job and takes the incentive off your invoice, so you never file anything. Bozeman’s rebate is a city application after installation. Montana’s federal HEEHR rebates, when they launch, are designed as point-of-sale discounts through registered contractors. Electric cooperatives set their own rules, and many serve rural Montana; DEQ’s advice is to check your co-op’s website. In every case, the dates on the form count, not the date you decided to buy.

What to do now, in this order

1. Find your utilities on your bills. Electricity and gas can come from different companies; each one’s rebates apply only to its own customers.
2. Seal and insulate first. NorthWestern gas customers are paid per square foot; it also shrinks the heat pump you need.
3. Replacing an electric water heater? Get quotes from NorthWestern’s participating contractors and ask to see the up-to-$3,000 incentive on the invoice; in Bozeman, add the city’s $500.
4. For a heat pump, check the model against NorthWestern’s SEER2 15.2 and HSPF2 8.5 minimums, and ask for a Manual J load calculation.
5. Keep every invoice itemized with model numbers and dates, and a recent bill for the address.
6. Finish and file before June 30, 2027 under NorthWestern’s current forms.
7. Do not pay for anything sold as a Montana HEAR or HOMES rebate. Follow the launch on DEQ’s program page.

What Montana guides still get wrong

Four errors show up in Montana HVAC rebate results. The first is federal: a reference page on Google’s first page still tells readers that a heat pump replacing a gas furnace can earn the 25C credit and that the 25D geothermal credit runs uncapped through 2032; both ended with 2025. The second is the opposite mistake: a heat pump incentive directory says the federal HEAR and HOMES programs ended on May 29, 2026, when they were renamed and rewritten — and in Montana are still in planning. The third is state tax: contractor pages still advertise Montana’s energy conservation credit of 25%, up to $500, which the Department of Revenue says cannot be claimed after 2021. The fourth is timing: guides written before August say NorthWestern’s heat pump rebate runs through June 30, 2026, when a new form now runs to June 30, 2027. The first two are logged on our corrections page; of the others, one was true when written and one dates from 2025.

Before you sign a quote: what we’d verify

• Whose rebate it is. NorthWestern pays its own customers only; a quote that counts a utility you are not on is wrong.
• The dates. Work from August 1, 2026, completed and submitted by June 30, 2027, under NorthWestern’s current forms.
• The model. SEER2 and HSPF2 ratings for a heat pump; Tier 3 or 4 on the NEEA list for a water heater.
• The discount on paper. For a heat pump water heater, the NorthWestern incentive shown as its own line on the invoice.
• No federal promises. No contractor can reserve a Montana HEEHR or HOMES rebate or a 2026 federal tax credit today.

Sources and method

Every program fact on this page was read on September 27, 2026 on the official source: Montana DEQ’s Home Energy Rebates Program page and its program status timeline; NorthWestern Energy’s Montana residential electric existing-home form 3743 and natural gas insulation form 3747, both effective August 1, 2026 to June 30, 2027, and its heat pump water heater program site; Montana-Dakota Utilities’ residential savings page for Montana, updated April 1, 2026; the City of Bozeman’s heat pump water heater rebate page; and the Montana Department of Revenue’s notice on the repealed Energy Conservation Installation Credit together with its rulemaking on the credits repealed by Senate Bill 399. The federal rules come from DOE Program Notice 26-2 and the IRS. Programs we did not re-read — NorthWestern’s natural gas furnace and boiler forms, electric cooperatives and Missoula County — are named without amounts.

Corrections involving Montana. We log every error we find — ours and the market’s — with the official source: A heat pump incentive directory says the federal HEAR and HOMES programs ended on May 29, 2026; A Montana HVAC rebate page on Google’s first page still presents the 25C and 25D credits as current. See the full corrections log.

Frequently asked questions

Are Montana’s HEAR (HEEHR) and HOMES rebates available?

No. The Montana Department of Environmental Quality says its Home Energy Rebates Program is not currently available. Planning was paused in February 2025 while DOE rewrote its guidance; DOE issued an initial revised overview on June 1, 2026, and DEQ must revise and resubmit its application and receive final DOE approval before anything can launch. No launch date has been announced.

What HVAC rebates can Montanans get right now?

Utility rebates. NorthWestern Energy pays $450 for a qualifying ducted or ductless heat pump to residential electric customers, and up to $3,000 off a heat pump water heater installed by a participating contractor. Montana-Dakota Utilities pays $300 for a 95% efficient gas furnace replacement. Bozeman adds $500 for a heat pump water heater, and many electric cooperatives run their own programs.

Does NorthWestern Energy give a rebate for a heat pump?

Yes: $450 per central heat pump, ducted or ductless, for NorthWestern Energy residential electric customers in existing homes. The unit must be ENERGY STAR rated or reach SEER2 15.2 and HSPF2 8.5. Under the current form, work finished or materials bought before August 1, 2026 do not qualify, and projects must be completed and submitted by June 30, 2027.

How much is the NorthWestern Energy heat pump water heater rebate?

Up to $3,000, taken as an instant incentive on the installation invoice, for NorthWestern Energy customers who have a trained participating contractor install a Tier 3 or Tier 4 heat pump water heater from the NEEA qualified products list. The contractor confirms eligibility before the install. NorthWestern calls the offer limited-time.

Are there any federal rebates for HVAC in 2026?

Not in Montana yet. The federal 25C and 25D tax credits ended for work placed in service after December 31, 2025, and the federal HEEHR and HOMES rebates reach homeowners only through a state program, which Montana has not launched. The federally funded Weatherization Assistance Program, run by the state health department, still serves income-qualified households.

Does Montana have a state tax credit for heat pumps or energy upgrades?

Not for a heat pump, furnace or insulation. The Montana Department of Revenue says the Energy Conservation Installation Credit, which covered efficient heating and cooling systems and insulation, was repealed by the 2021 Legislature and cannot be claimed after tax year 2021, and the Montana Code lists the alternative energy system credit as repealed. For a geothermal system, ask a Montana tax preparer. DEQ’s Alternative Energy Revolving Loan Program offers low-interest loans instead.

Does Montana-Dakota Utilities offer heat pump rebates?

No. Montana-Dakota’s Montana residential programs pay $300 for replacing a gas furnace with one rated 95% AFUE or higher, $15 or $60 for thermostats and up to $7 per LED bulb. Funding runs on a March-to-February plan year and ends when the money does. There is no heat pump rebate on its Montana page.

More state guides

See the full state-by-state registry, or the states we cover in depth: Texas, Maryland, Georgia, New York, Wisconsin, Colorado and Washington. Every dated deadline is on our deadline calendar. For what ended federally, read heat pump tax credit 2026, and for the insulate-first rule, our insulation rebates guide.