California Furnace and Air Conditioner Rebates (2026)
Updated October 3, 2026. Written by Sam Menard.
Short answer: Most California homes can't get a rebate for a new furnace or air conditioner in 2026. PG&E's rebate page lists no furnace, AC or heat pump rebate. The two big statewide heat pump programs are full: TECH Clean California is waitlist-only, and HEEHRA was fully reserved on February 24, 2026. The federal tax credits ended December 31, 2025. What's still open: SMUD customers get up to $3,000 for a heat pump plus up to $2,000 when switching off gas, and income-qualified PG&E customers can get a broken or unsafe gas furnace repaired or replaced free through the Energy Savings Assistance program.
What rebates exist for heating and cooling in California?
| Upgrade | Program | What you get |
|---|---|---|
| New gas furnace | PG&E / SCE / SDG&E | No rebate. Income-qualified homes can get an unsafe or broken furnace repaired or replaced free (ESA). |
| New central air conditioner | PG&E / SCE / SDG&E | No rebate listed for homeowners. |
| Heat pump (statewide) | TECH Clean California | Waitlist only since Nov 14, 2025. Was $1,000 to $5,000. |
| Heat pump (income-qualified) | HEEHRA (state IRA rebates) | Fully reserved Feb 24, 2026; new requests waitlisted. Was up to $8,000. |
| Heat pump (Sacramento) | SMUD | Up to $3,000 for a two-stage or variable-speed heat pump, plus up to $2,000 Go Electric bonus when replacing a gas furnace. |
| Heat pump (LA city) | LADWP | Check LADWP's current Consumer Rebate Program amounts. |
| Federal tax credit | IRS 25C | Ended for installs after Dec 31, 2025. |
| Free upgrades (income-qualified) | Energy Savings Assistance (ESA) | Free furnace and water heater repair or replacement if PG&E finds the gas unit broken or unsafe. Owners and renters. |
Should you replace your furnace or switch to a heat pump?
It depends on your furnace's age, your fuel, and your income. Find the row that sounds like you:
| If… | Our honest advice |
|---|---|
| Your gas furnace works and your AC is dying | Replace the AC with a heat pump. It costs about the same, cools the same, and can take over most heating. Keep the furnace as backup. |
| Your gas furnace is failing and you're a SMUD customer | Get a heat pump quote first. Up to $5,000 in SMUD rebates often makes it cheaper than a new furnace plus AC. |
| Your gas furnace is failing and you're PG&E, SCE or SDG&E | There's no rebate either way right now. Compare real quotes for a furnace + AC and for a heat pump. Coastal and valley winters are mild, so heat pumps work well. |
| Your income is limited | Apply for Energy Savings Assistance first. If your furnace is broken or unsafe, it can be fixed or replaced free. |
| You're on a TECH or HEEHRA waitlist | Don't sign until your reservation is confirmed. Contractors apply for these, so ask yours to check. |
Before you sign a quote
- Get at least two written quotes, and ask each installer to quote both a furnace and a heat pump.
- Ask how they sized the system. A good installer does a heat-loss calculation, not a rule of thumb.
- If you want a rebate, get pre-approval before the install. Most programs refuse claims for work already done.
- Ask who files the rebate paperwork, and get it in writing.
Compare top-rated installers near you
Free for homeowners. We rank local heating companies by their Google reviews. How we rank.
- Top-rated heat pump installers in Rancho Cordova (16,390 Google reviews)
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- Top-rated heat pump installers in Los Angeles (11,202 Google reviews)
- Top-rated heat pump installers in Ontario (10,767 Google reviews)
- Top-rated heat pump installers in Sacramento (10,729 Google reviews)
- Top-rated heat pump installers in San Diego (7,768 Google reviews)
- Top-rated heat pump installers in Riverside (6,382 Google reviews)
- Top-rated heat pump installers in San Francisco (6,263 Google reviews)
Common questions
Does PG&E give a rebate for a new furnace?
No, not for most homes. PG&E's rebate page lists no furnace rebate in 2026. Income-qualified customers can get a broken or unsafe gas furnace repaired or replaced free through the Energy Savings Assistance program.
Is there a California rebate for a new air conditioner?
Not from PG&E, SCE or SDG&E for most homeowners. A heat pump replaces an AC and also heats, but the statewide heat pump rebates are full right now.
Is TECH Clean California still available?
Single-family incentives were fully reserved on November 14, 2025. New requests go on a waitlist.
Can I still get the federal tax credit for a heat pump or furnace?
No. The 25C credit ended for equipment installed after December 31, 2025.
What does SMUD pay to switch from a gas furnace?
Up to $3,000 for a qualifying heat pump, plus up to $2,000 from the Go Electric bonus when you replace a gas furnace or gas water heater.
Sources, checked October 3, 2026: PG&E rebates and incentives · PG&E Energy Savings Assistance · TECH Clean California · California Energy Commission: HEEHRA · SMUD rebates · SMUD Go Electric bonus · IRS 25C credit. Amounts change; confirm with the program before you buy.
Related: California rebates by city · California heat pump rebates you can stack · PG&E pre-approval guide · Furnace and AC vs heat pump
Other regions: British Columbia · Ontario · Alberta