Learn more about heat pump waters and see how they compare with conventional water heaters.

• The installation address must be connected to City of Bozeman water. 
• Rebates are limited to 1 unit up to $500 per installation address.
• If the Applicant is not the owner of the building, the owner must provide a letter of approval for the installation. 
• Rebates apply only to newly purchased electric heat pump water heater units that are included on NEEA's Residential HPWH Qualified Product List.
• Applicants for commercial projects and multi-family (4+ units) buildings must contact sustainability@bozeman.net prior to submitting rebate applications.  
• Heat pump water heaters installed prior to July 1, 2023 are not eligible. 
• Additional requirements can be found on the Heat Pump Water Heater Rebate Form.

1. Pre-Application (Optional)

The pre-application is an optional step to help ensure that the water heater you plan to install qualifies for the rebate and funding is available. Once you have selected the HPWH you plan to install, submit a Pre-Application Form. After submitting the pre-application, our City staff will promptly get in touch with you to verify the eligibility of your proposed installation for the rebate. The corresponding rebate funds will be reserved for a period of up to 30 days. Following installation, you will need to submit a Rebate Application Form to receive a rebate. 

2. Rebate Application

Following installation, submit a Rebate Application Form. This form requires proof of installation, an invoice from the installation contractor is preferred (including a line item for the purchase price of the unit or a separate purchase receipt). If self-installed, a receipt for the purchase and a photo of the installation will suffice.

3. Satisfaction Survey (Optional)

Following the approval of your rebate application, City staff will contact you to set up an optional satisfaction survey. This will consist of a 10 to 15-minute follow-up call. Participants will receive an additional $75 rebate. 

The City of Bozeman is partnering with the Montana Department of Environmental Quality (DEQ) to launch a pilot heat pump water heater rebate program. 

Advancing energy efficiency reduces energy consumption, enhances grid reliability, and helps achieve community goals within the Bozeman Climate Plan, which calls for the improvement of building energy efficiency and beneficial electrification community-wide.

Since heat pump water heaters use up to 70% less energy than conventional electric water heaters, they can provide meaningful utility bill cost savings to advance housing affordability. 

Heat pump water heaters are highly efficient and widely used around the world, but the technology has yet to gain a significant foothold in Montana markets. As a result, the purchase and installation costs are higher than standard water heaters. With funding from Montana DEQ, the pilot heat pump rebate program is designed to reduce market barriers, accelerate consumer demand, and increase opportunities for contractors to enhance their experience with the technology, ultimately accelerating market adoption in the Bozeman area. 

The pilot rebate will provide Montana DEQ with information and insights on implementing local consumer rebate programs to help prepare Montana to take advantage of current and upcoming incentive programs. 

HPWHs are generally taller than conventional tank water heaters, so assessing clearance is an important factor.

In addition to spatial dimensions, HPWHs require sufficient air flow around them to operate efficiently. Because they pull air from the surrounding space, they need more airspace than the typical water heater. HPWHs require about 750 cubic feet of air space. However, there are many different ways the space can be configured for the heat pump to operate efficiently, including direct venting to the outside.

Because HPWHs take in warm air and extract the heat, they vent a small amount of cool dry air. If HPWHs are not vented to the outside and installed in conditioned air spaces, it could decrease the performance of your HVAC system in the winter.

Garages, basements, and laundry rooms are typically great places for an installation. However, the air temperature should remain between 40° to 90° F year-round for the heat pump to operate efficiently.