Estimated Savings for a Typical Alabama Home
2,000 sq ft home switching from electric-resistance heating
Installed Cost
$13,000
State Rebate
None
Net Cost
$13,000
Current Heating Cost/yr
$1,207
Heat Pump Cost/yr
$366
Annual Savings
$841
Payback Period
15.5 yrs
15-Year Savings
$2,886
CO₂ Avoided/yr
5,416 lbs
Alabama Heat Pump Rebates
✕
Federal 25C Tax Credit (Expired Dec 31, 2025)
The federal Energy Efficient Home Improvement Credit (up to $2,000 for heat pumps) ended December 31, 2025. Heat pumps installed in 2026 do not qualify for it.
Up to $8,000
HEEHRA Federal Rebate (Income-Qualified)
Households at or below 150% of area median income can receive up to $8,000 toward a heat pump through the federal HEEHRA program, administered by Alabama. View full rebate detail →
Heat Pump Costs by City in Alabama
| City | Annual Savings | Payback (yrs) | Population ↓ | Utility |
|---|---|---|---|---|
| Birmingham | $787 | 16.5 | 212,237 | Alabama Power |
| Montgomery | $579 | 22.5 | 199,518 | Alabama Power |
| Huntsville | $651 | 20 | 190,582 | Alabama Power |
| Mobile | $615 | 21.1 | 187,041 | Alabama Power |
| Tuscaloosa | $510 | 25.5 | 99,543 | Alabama Power |
| Hoover | $749 | 17.4 | 84,126 | Alabama Power |
| Dothan | $483 | 26.9 | 68,001 | Alabama Power |
| Auburn | $477 | 27.2 | 63,118 | Alabama Power |
| Decatur | $755 | 17.2 | 52,942 | Alabama Power |
| Madison | $637 | 20.4 | 48,174 | Alabama Power |
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Quick Facts: Alabama
- 🌡️ Climate: Mild (2,600 HDD)
- ⚡ Avg electricity: $0.132/kWh
- 🔥 Natural gas: $1.35/therm
- 🏭 Top utility: Alabama Power