As of January 5, 2020, there are two government incentives available in 2020 to reduce the net cost of installing a geothermal (ground source heat pump) heating & cooling system:
NYSERDA (New York State Energy Research & Development Administration) administers a rebate which is worth $1500 per ton of system cooling capacity up to 10 tons or $15,000. (For systems greater than 10 tons, the rebate is worth $1200 per ton.) Most homes require a 3- to 6-ton system. The system must be designed and installed by NYSERDA-qualified contractors, such as Lake Country Geothermal, and the client must be paying the systems benefit charge (SBC) on his/her monthly electric utility bill. RG&E, NYSEG, and National Grid electricity customers pay the SBC; municipal electric (including Fairport Electric) customers do not and, therefore, are not eligible for this incentive. Application is made by the contractor on behalf of the client and is typical applied for and approved before the project begins. The project must be completed and start-up performance data submitted within 12 months of approval for existing buildings and within 24 months for new construction. This program has been extended twice since its original termination date of June 2019. Currently, the program is scheduled to end on March 31, 2020; all applications approved prior to that will remain eligible for the rebate.
Note that there have been discussions in Albany to continue a New York State incentive beyond March but to transfer its administration and definition to your electric utility. However, there has been no official announcement to date. If you’re interested in having a geothermal heating & cooling system installed in the near future, we urge you to contact us ASAP so we can get your project approved for NYSERDA’s rebate before March 31.
The Federal government also offers a tax credit for qualified geothermal system installations. For residential installations completed by December 31, 2020, the credit is 26% of qualified costs; for residential installations completed after that and by December 31, 2021, the credit is 22%. Commercial installations commenced by December 31, 2021 are eligible for a 10% tax credit and MACRS 5-year accelerated depreciation. The client is responsible for applying for this incentive at the time (s)he submits tax returns. See IRS Form 5695 https://www.irs.gov/pub/irs-pdf/f5695.pdf for more information.
We suggest that you contact your electric utility, as they may also offer an incentive. National Grid, for example, has for over a year.