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Heat pump shipments stayed strong in the first half of 2026 after the federal 25C tax credit expired at the end of 2025, according to a Building Decarbonization Coalition report. The report says shipments are on track to match or exceed the technology’s best year, but the full-year total is not yet available and the reasons for the resilience are not confirmed.
U.S. heat pump shipments remained strong in the first half of 2026, months after a federal tax credit worth up to $2,000 expired, according to a recent report from the Building Decarbonization Coalition. The nonprofit says shipments are on track to match or exceed the technology’s best year, though the final 2026 tally is not yet available.
The report draws on shipment figures from the Air-Conditioning, Heating, and Refrigeration Institute, an industry trade group that represents most of the U.S. market. The figures provide an early measure of sales activity, but they do not establish why households continued to buy heat pumps after the federal incentive ended.
The federal 25C tax credit reduced the cost of eligible heat pumps by as much as $2,000. It expired at the end of 2025, seven years earlier than the deadline set by the Biden administration, according to the source report. The credit had been one part of federal support for household clean-energy upgrades, alongside incentives for technologies such as rooftop solar and batteries.
The report presents strong shipments as evidence that the market has so far held up without that federal support. That does not mean the credit had no effect, or that every region and household experienced the same demand. Shipment data alone cannot show how many buyers would have proceeded with a purchase only because of the credit.
Demand After the Tax Credit
The early shipment figures matter because the expired credit lowered the upfront cost of a major home heating and cooling purchase. If sales remain strong through the year, that would suggest heat pump demand can persist without the federal incentive, although it would not establish that the credit was unnecessary or had no impact on adoption.
Heat pumps can provide both heating and cooling, and can replace gas furnaces in some homes. Their adoption affects household equipment choices and the pace at which buildings move away from fossil-fuel heating. The continued shipment strength may be encouraging for contractors and manufacturers, but buyers could still face different costs and incentive options depending on where they live.
For households considering a system, the report is not a guarantee of lower prices or continued local assistance. It describes market-wide shipments, not a measure of affordability, installation availability, or the financial outcome for individual customers.
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Why Heat Pump Purchases May Persist
One possible explanation is that the tax credit was not a deciding factor for many buyers. Lucas Davis, a business professor at the University of California, Berkeley, proposed that some households may have bought heat pumps without knowing about the credit, or learned about it only when filing taxes. He pointed to previous research on geography, climate, and electricity prices as factors shaping adoption.
Contractors interviewed by industry publication ACHR News have also said they were often the ones who introduced customers to the tax credit, rather than customers asking about it first. That account is consistent with the possibility that some purchases were driven by other considerations, but it does not prove how much the credit influenced the market overall.
Other support has not necessarily disappeared everywhere. The source report notes that some states and utilities still offer heat pump incentives, while local governments continue to adopt ordinances encouraging households to move away from fossil fuels. It also cites contractors’ growing familiarity with the technology. The availability and value of these factors vary by location.
“I suspect most households adopted heat pumps without ever knowing anything about the credit, or didn’t learn about the tax credit until months later when filing their taxes.”
— Lucas Davis, business professor at the University of California, Berkeley
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What Shipment Data Cannot Show
The available report does not give a final full-year 2026 shipment count. Its forecast that the year could match or exceed the technology’s best year remains a projection, not a confirmed result. The source material also does not specify the exact shipment total, the comparison year, or a month-by-month breakdown.
It remains unclear how much of the continued demand reflects state or utility incentives, local policies, contractor experience, consumer preferences, or other market conditions. Shipment totals also do not reveal how many systems were installed, whether buyers received other assistance, or what demand would have been if the federal credit had remained in place.
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The Full-Year Shipment Count
The next key development is the final 2026 shipment tally, which will show whether the first-half strength carried through the rest of the year. Until that figure is released, the coalition’s expectation that shipments will match or exceed the technology’s best year should be treated as an outlook rather than an outcome.
Further reporting could also clarify how demand differs across states and how much local incentives contribute. For now, the confirmed picture is limited: shipments stayed strong in the first half of 2026 after the federal tax credit expired, while the causes and full-year result remain unsettled.
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Key Questions
Did the federal heat pump tax credit expire?
Yes. The source report says the 25C credit, which could reduce the price of a heat pump by up to $2,000, expired at the end of 2025.
Have heat pump shipments fallen since the credit ended?
The report says shipments remained strong in the first half of 2026. It does not provide a final full-year total or establish that shipments increased compared with a specific baseline.
Why might demand remain strong without the federal credit?
Possible factors cited in the report include climate, geography, electricity prices, local incentives, local policies, and contractors’ greater familiarity with the technology. The shipment data do not identify which factors mattered most.
Can households still get help paying for a heat pump?
The report says some states and utilities continue to offer incentives. Availability and terms depend on location; the source material does not provide a complete list of current programs.
When will it be clear whether 2026 was a record year?
That will depend on the final 2026 shipment figures. The report says the technology is on track to match or exceed its best year, but the final count has not yet been released.
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