Heat Pumps

Get rebates when you install a new heat pump

Heat pumps are among the most efficient and environmentally friendly heating and cooling systems on the market. Install one in your home to lower your energy bills, and we’ll give you money back through our rebate program.

The benefits of heat pumps

Heat pumps don't make heat—they move it. They move free heat available in the air or ground into your home to keep you warm in the winter, and move it out of your home to keep you cool in the summer. 

There are two kinds of heat pumps: air-source and geothermal.

  • Air-source heat pumps operate at more than 200% efficiency. Even when combined with the supplemental electric heating that’s needed during the coldest weather, they can reduce your total heating costs by 30% to 60%.
  • Geothermal heat pumps are incredibly economical. They deliver more than 4 units of heat for each unit of energy used, which can reduce your annual heating and cooling costs by 70%.

Rebate eligibility and details

Qualifying high-efficiency air-source or geothermal heat pumps are eligible for rebates through the Minnesota Conservation Improvement Program (CIP).

  • Get a rebate of $400 per ton on air-source heat pumps labeled ENERGY STAR or that have proof of the following ratings:
    • Split-system installation with 15.0 or greater seasonal energy-efficiency rating (SEER), 12.5 or greater energy efficiency ratio (EER), and 8.5 or greater heating season performance factor (HSPF).
    • Package-terminal heat pump installation with 12.0 or greater EER.
  • Get a rebate of $800 per ton on geothermal heat pumps labeled ENERGY STAR or that have proof of a qualified minimum coefficient of performance (COP) rating as shown in the table below.
Type COP
  Open-loop configuration Closed-loop configuration
Water-to-air 4.1 3.6
Water-to-water 3.5 3.1
Direct-exchange 3.6

Acceptable proof of your heat pump’s efficiency levels include AHRI certificates and manufacturer specification sheets. Heat pumps labeled ENERGY STAR will qualify for a rebate when proof is provided for the make and model installed.

Rebates are not available on heat pumps installed as replacements for natural gas as a primary heat source. If you have any questions about program eligibility, contact our Idea Center via email or call 800-493-3299 during business hours.

Apply for your rebate

Fill out the rebate form. When completed, mail it, along with any required documentation, to:

Idea Center
Otter Tail Power Company
P.O. Box 496
Fergus Falls, MN  56538

Please allow 6–8 weeks for your rebate check to arrive.