Heat Pump Savings Calculator in Arizona
Compare heat pump and furnace heating costs in Arizona. Uses local climate data (1500 HDD), electricity rates, and fuel prices for accurate savings estimates.
Data last updated July 2026. Sources & methodology
What Arizona Residents Should Know
Arizona falls in IECC climate zone 2B with 1,500 heating degree days per year — well below the national average. With an average heating COP of 3.5, heat pumps in Arizona operate at high efficiency, producing 3.5 units of heat for every unit of electricity consumed.
At Arizona's natural gas price of $1.30 per therm and electricity at $0.138 per kWh, a heat pump can save roughly $3 per year in heating costs compared to a gas furnace. Heat pumps also provide cooling in summer, potentially replacing both your furnace and central AC in a single system and eliminating separate maintenance contracts.
A heat pump also replaces your air conditioner, and Arizona's 4,000 cooling degree days make that dual-function value real: one system handles both seasons, so you retire a separate AC unit and its maintenance along with the furnace. For homes with an aging furnace-and-AC pair, replacing both at once is usually where a heat pump makes the strongest financial case in Arizona.
Arizona residents can access up to $725 in state rebates and incentives for heat pump installations. With the federal 25C credit having ended December 31, 2025, these state and utility programs are now the primary way to reduce the upfront installation cost, which typically ranges from $4,000 to $8,000 depending on system size and complexity. Run the calculator above with your home details to see your personalized payback estimate.
Avg. Electricity Rate
$0.138/kWh
Avg. monthly bill: $149
Regular Gas Price
$3.35/gal
Natural gas: $1.30/therm
Heating Degree Days
1,500
Cooling: 4,000 CDD
TOU Peak Rate
$0.240/kWh
Off-peak: $0.080/kWh
Incentives in Arizona
Federal clean energy tax credits ended in late 2025 under legislation passed in July 2025; they are shown below for reference since recent purchasers may still claim them. State programs are governed separately and many remain active — always verify current details with the program before purchasing.
| Incentive | Type | Amount | Description |
|---|---|---|---|
| Energy Efficient Home Improvement Credit (Heat Pump - 25C)Ended | tax credit | 30% | Federal tax credit of 30% up to $2,000 for qualifying heat pumps. Ended December 31, 2025 — systems placed in service after that date do not qualify. State and utility heat pump rebates remain available in many states. |
| SRP Cool Cash Heat Pump Rebate | rebate | $225 | Salt River Project pays up to $225 per ton of cooling capacity for a qualifying high-efficiency variable-capacity heat pump (15 SEER2+). |
| SRP Heat Pump Water Heater Rebate | rebate | $500 | Salt River Project offers a $500 rebate for a qualifying ENERGY STAR heat-pump water heater (UEF 2.8+), once per residence every 10 years. |
Heat Pump Savings in Arizona: Frequently Asked Questions
- Are heat pumps worth it in Arizona?
- In Arizona, a heat pump can save around $3 per year versus a gas furnace while also providing air conditioning, which usually makes it worthwhile for homeowners replacing aging heating or cooling equipment.
- Do heat pumps work in Arizona's climate?
- Arizona sits in IECC climate zone 2B with about 1,500 heating degree days per year. Modern heat pumps there average a heating COP of 3.5, meaning they deliver 3.5 units of heat per unit of electricity.
- Are there heat pump rebates in Arizona?
- Yes. Arizona residents can access SRP Cool Cash Heat Pump Rebate and SRP Heat Pump Water Heater Rebate, worth up to $725. The federal 25C credit ended December 31, 2025, so these state and utility programs are now the main way to cut installation cost.
Run the Heat Pump Savings Calculator
Use our free calculator pre-filled with Arizona data to see your personalized results.
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