Kentucky headline: Two layers stack here. Your utility pays a rebate: LG&E and KU give about $400 for an ENERGY STAR heat pump, Duke Energy runs Smart Saver, and TVA EnergyRight covers the west. On top, income-qualified households can add the federal HEAR rebate, up to $8,000 per heat pump, through the Kentucky Energy and Environment Cabinet. The federal 25C credit expired after December 31, 2025.

Kentucky stacks a utility rebate with a federal rebate

Kentucky does not have its own separate state heat pump rebate, but it does have two layers you can combine: a utility rebate and the federal HEAR rebate.1

The federal HEAR rebate, administered by the Kentucky Energy and Environment Cabinet, pays up to $8,000 for a heat pump for households below 150% of Area Median Income.1 Because rollout details can change, confirm the current status and application window with the Cabinet before you count on it.

This is the Kentucky companion to our 2026 heat pump rebate guide.

Layer 1: your utility rebate

Every major Kentucky utility offers something, and the amount depends on who bills you.

LG&E and KU

Louisville Gas and Electric and Kentucky Utilities serve Louisville, Lexington, and much of the state. Residential customers on qualifying rate classes can claim a cash rebate on an ENERGY STAR heat pump, around $400.2

The stacking point: LG&E and KU say their rebates can be combined with the federal HEAR rebate.2 So an income-qualified household is not choosing between them, it gets both.

Duke Energy Kentucky

Duke Energy serves the northern Kentucky suburbs across from Cincinnati. Its Smart $aver program pays a rebate for a qualifying ENERGY STAR heat pump.3 Confirm the current amount with Duke.

TVA EnergyRight (western Kentucky)

Western Kentucky is served by the Tennessee Valley Authority through local cooperatives. TVA EnergyRight offers a heat pump rebate in that territory, applied through your local power company.

Layer 2: the federal HEAR rebate

For income-qualified households, HEAR is the big one.1

MeasureHEAR rebate (income-qualified)
Heat pump (HVAC)up to $8,000
Heat pump water heaterup to $1,750
Insulation and air sealingup to $1,600
Electrical panel upgradeup to $4,000

The household maximum is $14,000. Below 80% AMI gets the highest tier; 80 to 150% AMI gets 50% of project cost.

The senior and income path: Home Uplift in the west

For a low-income senior in western Kentucky, ask about this one. TVA’s Home Uplift program provides an average of about $10,000 in free upgrades, which can include a heat pump, for households at or below 200% of the Federal Poverty Level in TVA territory.4

Two income paths: statewide, HEAR covers up to $8,000 for households below 150% AMI. In western Kentucky, Home Uplift adds a free-upgrade route for households below 200% of poverty. Many seniors on Social Security qualify for one or both. Apply early, since waitlists are common.

Income limits (2026)

HEAR uses Area Median Income (AMI) at the county level.7 Below 80% AMI gets the highest tier; 80 to 150% AMI gets 50% of cost.

Approximate 80% AMI thresholds for a family of 4:

County / region80% AMI (family of 4)
Jefferson County (Louisville)~$70,000
Fayette County (Lexington)~$68,000
Kenton County (northern KY)~$74,000
Warren County (Bowling Green)~$60,000
Rural Kentucky counties~$46,000 to $52,000

For a senior household on Social Security only, eligibility is usually clean in any Kentucky county.

Federal layer (2026)

The federal 25C Energy Efficient Home Improvement Credit, which paid up to $2,000 for a heat pump in prior years, expired for installs after December 31, 2025.5

What remains in 2026:

  • 25D Residential Clean Energy Credit: 30% of solar cost through 2034. Applies if you pair the heat pump with solar.6
  • 25C on insulation, panel upgrades, and audits: still active at smaller caps. Heat pumps are excluded.

See IRA 25C expired 2026 for the full federal picture.

Senior stack scenarios

Scenario A: Louisville retired couple, LG&E customer, 75% AMI

  • Federal HEAR (below 80% AMI): up to $8,000
  • LG&E heat pump rebate: about $400
  • Total: up to $8,400. On a $14,000 install, out-of-pocket can drop toward $5,600.

Scenario B: Lexington household, KU customer, 120% AMI

  • Federal HEAR (80 to 150% AMI, 50% of cost): up to $4,000
  • KU heat pump rebate: about $400
  • Total: up to $4,400. On a $15,000 install, out-of-pocket lands around $10,600.

Scenario C: Paducah household, TVA cooperative, income at 180% of poverty level

  • TVA Home Uplift (under 200% poverty): about $10,000 in free upgrades
  • TVA EnergyRight rebate: applies to the equipment
  • Total: potentially a largely no-cost heat pump through Home Uplift.

Verify your contractor first

A rebate is only as good as the contractor who installs the equipment. Kentucky licenses HVAC contractors at the state level, and both utility and HEAR rebates require an enrolled contractor.

Red flags to reject:

  • Door-to-door pitches. Legitimate contractors do not cold-call.
  • A guaranteed federal rebate before you apply. HEAR checks eligibility case by case.
  • No Kentucky license number on the quote.
  • R-410A equipment for a 2026 install. That refrigerant no longer qualifies under the EPA rule.8

Verify a license in about a minute with our Kentucky contractor license lookup guide.

Kentucky senior action plan:
  1. Find your utility on your electric bill (LG&E/KU, Duke, or TVA co-op)
  2. Claim the utility rebate: about $400 from LG&E/KU, Smart Saver from Duke
  3. If below 150% AMI, apply for the federal HEAR rebate (up to $8,000)
  4. Western Kentucky: ask about TVA Home Uplift if income-qualified
  5. Use a Kentucky licensed, enrolled contractor and stack both layers

What’s next

Citations

  1. Kentucky Home Energy Rebates (HEAR and HOMES). Kentucky Energy and Environment Cabinet, retrieved July 23, 2026. .
  1. Energy Efficiency Programs (Residential Rebates). LG&E and KU, retrieved July 23, 2026. .
  1. Smart $aver Residential Heat Pump Rebate. Duke Energy, retrieved July 23, 2026. .
  1. Home Uplift Income-Qualified Upgrades. Tennessee Valley Authority, retrieved July 23, 2026. .
  1. Energy Efficient Home Improvement Credit (25C). U.S. Internal Revenue Service. .
  1. Residential Clean Energy Credit (25D). U.S. Internal Revenue Service. .
  1. Income Limits Documentation System. U.S. Department of Housing and Urban Development, April 2026. .
  1. Technology Transitions: Restrictions on Use of Certain HFCs. U.S. Environmental Protection Agency. .