Replacing an aging furnace with a heat pump often involves new equipment, electrical upgrades, and important decisions about backup heating. The EmPOWER Maryland Rebate Program offers incentives for qualifying electric heating upgrades in 2026, with amounts varying by your utility provider and project requirements.
Qualifying Baltimore Gas & Electric (BGE) homeowners may receive up to $15,000 toward eligible whole-home electrification improvements, while separate incentives up to $2,500 are available for water heaters. These Maryland HVAC rebates depend on the utility program and project requirements. At Fresh Air Concepts, we help homeowners evaluate their existing systems and plan heating and cooling upgrades around their comfort needs.
What Is the EmPOWER Maryland Rebate Program?
The EmPOWER Maryland Rebate Program was created to help Maryland homeowners and businesses reduce energy consumption and lower utility costs. Through participating utility providers, including Baltimore Gas & Electric, Delmarva Power, Potomac Edison, Pepco, Washington Gas, and Southern Maryland Electric Cooperative, eligible customers may receive incentives for home energy audits, weatherization, efficient appliances, and HVAC upgrades.
Rebate amounts and eligibility vary by utility and program. Recent changes have expanded support for home electrification, including high-efficiency heat pumps and heat pump water heaters that replace qualifying fossil-fuel equipment. These improvements can reduce energy use while helping eligible households manage upfront installation costs.
HVAC Rebates
Maryland HVAC rebates can help offset the cost of qualifying air-source heat pumps, ductless mini-splits, and geothermal systems. BGE’s Home Performance program also supports eligible whole-home electrification projects that include energy improvements such as attic insulation and air sealing. The specific incentive depends on the utility, equipment, and project requirements.
Heat Pump Water Heater Rebates
Heat pump water heaters use electricity to transfer heat into stored water and may qualify for utility rebates. BGE offers water heater rebates of up to $1,600 on select ENERGY STAR-certified models. Additional electrification and home-preparation assistance may be available for qualifying projects, depending on the utility program.
Electrification Rebates: 2026 Savings by Utility
Heating and cooling rebate amounts differ across Maryland’s utility programs. BGE’s 2026 incentive schedule bases Home Performance rebates on modeled energy savings, while Pepco incentives and Delmarva incentives list separate equipment-level amounts. Here’s how they compare:
- Tier 1 air-source heat pumps: Starting at $400 through BGE Home Performance; $2,000 through Pepco or Delmarva electrification incentives.
- Tier 2 air-source heat pumps: Starting at $650 through BGE Home Performance; $2,500 through Pepco or Delmarva.
- Ductless multi-zone heat pumps: Starting at $400 through BGE Home Performance; $3,500 through Pepco or Delmarva.
- Closed-loop geothermal heat pumps: Starting at $1,500 through BGE Home Performance; $5,500 through Pepco or Delmarva.
Qualifying BGE homeowners may receive up to $15,000, capped at 75% of eligible project costs, through the Home Performance program. The program requires an energy audit and qualifying attic insulation and air sealing, subject to applicable exemptions. Final rebates depend on modeled energy savings.
What Is Make-Ready Enablement?
Some homes need additional wiring, circuits, or electrical panel upgrades before a new heat pump can be installed. These electrical changes, called make-ready work, may increase the upfront cost of an HVAC replacement.
For qualifying BGE heating and cooling electrification projects, make-ready assistance can cover 75% of eligible preparation costs, up to $3,000. Available through participating contractors, this incentive can reduce the cost of preparing a home for electric heating equipment.
Who Qualifies for 2026 EmPOWER Maryland Rebates?
Eligibility for 2026 EmPOWER Maryland rebates depends on the utility and incentive program. Common requirements include:
- Residential utility service: Have an eligible residential account with BGE, Pepco (MD), or Delmarva Power (MD).
- Qualifying equipment replacement: Replace or partially replace existing natural gas, oil, or propane heating equipment. BGE allows qualifying hybrid conversions, although conditions vary by utility.
- Equipment efficiency: Choose qualifying AHRI-rated equipment that meets the program’s applicable SEER2, HSPF2, or geothermal efficiency standards.
- Contractor participation: Work with a participating contractor or verified distributor when required by the program.
- Additional conditions: Complete any necessary energy audit, rebate reservation, insulation, or air-sealing requirements for the selected incentive pathway.
Standard efficiency rebates and electrification incentives may not be combined for the same equipment. Before ordering a system, check whether your utility requires contractor verification, an energy audit, or a rebate reservation so those steps are handled before installation.
Plan Your 2026 HVAC Upgrade in Maryland
Before replacing your heating system, confirm which Maryland HVAC rebates apply to your equipment and utility account. At Fresh Air Concepts, we help homeowners throughout Maryland, Washington, DC, and Northern Virginia evaluate their existing systems, compare heat pump options, and prepare for installation.
Contact our team to discuss your current setup and replacement plans. We can help identify the information you’ll need when confirming rebate eligibility and application requirements with your utility.