California HEEHRA Heat Pump Rebates Go Fully Waitlisted Statewide

California's HEEHRA heat pump rebate ran out. TECH Clean California confirmed on February 24, 2026 that single-family Home Energy Efficiency Rebate and Rewards funds, worth up to $8,000 per qualifying project, were fully reserved statewide. Every new reservation request is going on a waitlist with no confirmed reopen date.

Southern and Central California had already burned through allocations by January 7. The rest of the state held on a few more weeks. By late February, every region was closed.

The Contractor Pipeline Problem

Plenty of California installers built their 2026 sales pipeline around HEEHRA. The program, funded through the federal Inflation Reduction Act and administered by the CEC through TECH Clean, paired well with the 25C federal tax credit and utility rebates. Through 2025, income-qualified households could stack $8,000 in HEEHRA, the then-available $2,000 in 25C, and utility incentives that varied by provider. Total out-of-pocket on a $14,000 install routinely dropped under $3,000. The 25C piece of that stack is gone for new 2026 installs (see below).

That math doesn't work anymore.

Contractors who had reserved funds before the cutoff can still redeem them on completed installs, assuming the reservation hasn't expired. But new leads walking in today can't be quoted with HEEHRA dollars at all. For shops that quoted deep discounts as a closing tool, the next few months will be an education in renegotiating at list price.

What's Still Available

Contractors should reset customer expectations fast. The 25C federal tax credit — worth up to $2,000 for qualifying heat pumps — was terminated for property placed in service after December 31, 2025 by P.L. 119-21 (the One Big Beautiful Bill Act, enacted July 4, 2025). It had originally been scheduled to run through 2032. Customers who completed a qualifying install in 2025 can still claim it on their 2025 federal return, but it is no longer available for new 2026 installs. Most California utilities still offer their own efficiency rebates per system, separate from HEEHRA, though amounts vary by utility and those funds generally renew each fiscal year. SGIP for battery and heat pump water heater pairings has its own rules and budget.

The waitlist question is how long the state can go without restoring HEEHRA capacity. TECH Clean has not committed to a reopen date. CEC is reportedly lobbying for supplemental federal funds, but the IRA budget is finite and the 2026 federal appropriations fight is ongoing. Contractors shouldn't plan on HEEHRA coming back in the fiscal year.

What happens on the street: shops that built business models around fully-stacked incentives will feel the squeeze first. Shops that have always sold the system on its own merits — comfort, efficiency, quiet operation — are better positioned to hold price through the gap.

For more context on how heat pump policy is shifting, see our coverage of the California Heat Pump Partnership's 6 million unit blueprint and heat pumps outselling gas furnaces nationally.

Sources

• TECH Clean California. "HEEHRA Rebates." techcleanca.com/incentives/heehrarebates
• TECH Clean California. "HEEHRA Rebates for Single-Family Homes in Central and Southern Regions Fully Reserved as of January 7, 2026." techcleanca.com/about/news
• California Energy Commission. "Inflation Reduction Act Residential Energy Rebate Programs." energy.ca.gov
• Internal Revenue Service. "Energy Efficient Home Improvement Credit" (Section 25C; terminated for property placed in service after December 31, 2025 under P.L. 119-21). irs.gov