Geothermal technology taps into steady underground temperatures to heat and cool a home or building with impressive efficiency.
Many property owners in Westchester are becoming more curious about switching to this cleaner, quieter option, and share the same question. What it will cost? Right now, Westchester is in a standout position as generous rebates, tax credits, and financing options are helping homeowners and businesses cut the price dramatically.
Local and federal programs are making geothermal upgrades far more affordable than often expected. With the right guidance, these incentives can stack to reduce a large portion of project expenses.
Why Geothermal Is A Smart Investment For Heating & Cooling In Westchester
Geothermal heat pumps move heat through buried loop systems that draw on the Earth’s consistent temperatures to keep homes comfortable year-round. That means comfortable heating in the winter and efficient cooling in the summer using far less energy than traditional fuel-burning systems.
In Westchester, this technology has gained momentum because local utilities have faced strain on the natural gas system for years. Con Edison had even paused many new gas hookups from 2019 through late 2023 due to pipeline capacity issues.
As part of a long-term plan to reduce fossil gas demand, the utility promotes clean heating upgrades, such as geothermal. That policy shift opened the door to significant financial incentives for property owners ready to make a change.
Many homeowners love the idea of improving efficiency and comfort while reducing reliance on fossil fuels. The bigger surprise is how much support is available to cut upfront costs, as several programs combine to significantly lower your out-of-pocket expenses.
Federal Residential Incentives That Can Defray A Large Portion Of Installation Costs
Homeowners installing a geothermal system in Westchester can benefit from the federal Residential Clean Energy Credit that covers 30% of qualified project costs for systems placed in service during 2025.
Both equipment and labor for drilling, trenching, wiring, and commissioning can qualify, and geothermal does not have a tax dollar cap. Any unused credit can be carried forward to reduce future federal taxes.
The geothermal heat pump must meet current ENERGY STAR requirements at the time of purchase. For instance, the home must be your primary or secondary residence. Utility incentives that reduce your invoice are usually subtracted from the cost basis before calculating the 30% credit, since the IRS treats them as price adjustments.
The credit currently applies through December 31, 2025, under tax rules passed in mid-2025, so timing matters if you want to capture the full 30%. Form 5695 gets filed with your tax return, and a qualified tax professional can provide guidance.
Incentives Available For Larger Buildings
Commercial properties, multifamily buildings, and nonprofit facilities may qualify for the Investment Tax Credit, which is typically 6% at the base level and up to 30% if prevailing wage and apprenticeship rules are met. Potential bonus adders are available for domestic content or energy community locations.
On top of that, Section 179D offers an immediate deduction per square foot for projects that improve building energy efficiency. Deep energy savings combined with required labor standards can raise the deduction into the higher range, which lowers taxable income significantly in year one. For owners of larger buildings, those tools shorten payback periods in a noticeable way.
New York State Offers A Strong Tax Credit For Residential Geothermal Systems
New York State supports clean thermal upgrades through its Geothermal Energy System Credit on Form IT-267. Homeowners can claim 25% of qualified costs, including drilling, loop piping, interior heat pump equipment, and professional installation.
Before July 1, 2025, the maximum cap is $5,000. Starting July 1, 2025, the maximum rises to $10,000 for systems placed in service on or after that date. The system must serve the residence you live in within New York State when it first operates.
Allocation rules usually allow condo and co-op owners to benefit from incentives tied to their share of the project cost. Any unused amount rolls forward for up to five years.
Con Edison’s Clean Heat Incentives Deliver Large Savings Upfront
Con Edison runs an aggressive incentive program for ground source heat pumps in Westchester County. Single-family homes can qualify for up to $25,000 or 50% of the project cost.
Homes located in Disadvantaged Community zones may qualify for up to $35,000 or 70% of the cost. The incentive is applied directly to the installer’s invoice, so customers see a large reduction immediately rather than waiting for reimbursement.
Multifamily retrofits can receive up to $5,000 per apartment, with total incentives up to $1 million or half of the project cost. New construction or gut rehab projects may qualify for $2,000 per apartment.
Con Edison even helps fund thermal-conductivity tests for large geothermal loop designs, covering up to $40,000 or half the cost. Commercial spaces can secure incentives sized to expected energy savings, with temporary program boosts allowing up to $400,000 for big installations through 2025 deadlines.
That invoice discount structure matters because it lowers the cost basis used to calculate federal credits. Contractors familiar with Clean Heat programs help customers capture the maximum available support.
Westchester Offers A Standout Opportunity To Upgrade To Geothermal And Capture Major Savings
Geothermal heating and cooling deliver year-round comfort and serious energy efficiency. Right now, Westchester residents and property owners have access to an unusually strong stack of rebates, tax credits, and financing tools that can make the switch far more affordable than expected.
A. Borrelli Mechanical has been helping Westchester families stay comfortable since 1981. Our experts can review available rebates for your home or building, coordinate with Con Edison Clean Heat programs, and connect you with financing options that keep monthly costs reasonable.
If you are considering geothermal and want guidance backed by decades of experience in the community, give us a call at (914) 301-7495. You can also reach us through our website to schedule a consultation.
