South Dakota Heat Pump Rebates
Geothermal units qualify for up to $1,500 per ton from Otter Tail Power under South Dakota heat pump rebates. Electric cooperatives pay as much as $1,200 per system, while cold-climate air-source models can earn up to $1,000 per ton.
Find the South Dakota rebates for your ZIP code
If JavaScript is off, locate your state in the program table.
Who sends your electric bill?
What are you putting in?
- Largest standard rebate available
- $1,200 Sioux Valley Energy Heat Pump Rebates, for Sioux Valley SW Elec Coop customers
- HEAR appliance rebates
- Not participating Run by South Dakota Bureau of Finance and Management. Official page
- HOMES whole-home rebates
- Not taking part Paid on the energy saved by a whole-home upgrade. Official page
- 25C federal tax credit
- Ended No credit for heat pumps installed after 31 December 2025
Rebates for heat pumps in South Dakota
To see what your household can claim, match the name of your monthly electric utility or rural cooperative to each program entry.
| Program | Who can get it | Central heat pump | Ductless mini-split | Heat pump water heater | Geothermal | Status | Apply |
|---|---|---|---|---|---|---|---|
| Otter Tail Power Heat Pump Rebates (South Dakota) | Served by Otter Tail Power Co | $700-per-ton base; total potential $1,000 per ton | $500-per-ton base; total potential $800 per ton | None | $1,100-per-ton; total potential $1,500 per ton | Open | Official page |
| Sioux Valley Energy Heat Pump Rebates | Served by Sioux Valley SW Elec Coop | $1,200 | $300 per account | None | $1,200 | Open | Official page |
| Southeastern Electric Cooperative Heat Pump Rebates | Served by Southeastern Electric Coop Inc | $600 | $300 | None | $800 | Open | Official page |
| Black Hills Energy South Dakota Residential Electric Rebates | Served by Black Hills Power, Inc. | None | None | $250 per unit | None | Open | Official page |
Claiming South Dakota Heat Pump Rebates From Your Utility
After your installer finishes the work, most electric providers want you to submit an application along with proof of the equipment. Heating capacity is measured in tons. Some utilities use tons to calculate the rebate rather than a flat amount. Use the filing steps for your particular company so bonus money is not lost:
- Heat pump rebates from Otter Tail Power rise by $200 per ton when your installer is certified for the Quality installation program. An additional $100 per ton comes from enrolling in a Dual Fuel, Deferred Load, or RDC rate. Send the 2026 form by email or post, along with your AHRI certificate. Your installer provides this official efficiency sheet. Give the utility six to eight weeks to process your payment.
- With Sioux Valley Energy, submit the invoice from your installer online, along with proof of the make, model, and backup furnace.
- For Southeastern Electric Cooperative or Black Hills Energy, send their rebate form along with a receipt that is dated.
Can Low-Income Families Get South Dakota Weatherization and State Rebates?
The state offers free home efficiency upgrades to qualifying households, but no federal appliance rebates are available. In August 2024, the state administration turned down roughly $69 million in federal money for the Home Energy Rebates programs. The whole-home rebates and the appliance rebates are both unavailable. Dakota Rural Action and South Dakota Searchlight both confirm that South Dakota is the only state to opt out.
Families with limited income can instead apply for the Weatherization Assistance Program run through the South Dakota Department of Social Services. The home efficiency upgrades are handled by four community action programs based locally. They help bring down energy bills that run high in winter. Exact income percentages do not appear on the state page. For four people, related energy aid sets a $16,075 cap on gross income earned in three months.
Cold Weather, Winter Heating Fuels, and Federal Tax Rules
The U.S. Energy Information Administration reports that natural gas is the primary home fuel for almost half of South Dakota households. Electricity heats about one-third of homes, and roughly one in six burn propane. Local cooperatives tend to require a backup furnace, since subzero days come around each year. Still, about 60% of an average South Dakota winter remains above 20 degrees Fahrenheit, according to Southeastern Electric Cooperative. Thanks to those milder winter days, two-thirds of your heating can come from an air-source heat pump.
When planning your budget, also know this: the federal 25C tax credit is no longer available. On July 4, 2025, Congress passed Public Law 119-21, also called the One, Big, Beautiful Bill. The Internal Revenue Service confirms that no credit is allowed once equipment goes into service after December 31, 2025.
Common Questions About South Dakota Heat Pump Rebates
What are the requirements to qualify for the reduced electric heat rate from Sioux Valley Energy?
Sioux Valley Energy charges 7.45 cents per kilowatt-hour under its winter electric heat rate, which runs from October through April. A submeter has to be installed on your home before you can get this rate. A submeter is its own meter, and it tracks only the electricity your heating equipment uses. Once every 10 years, the cooperative also pays $1,200 if your backup furnace is electric, or $600 with non-electric backup.
Which efficiency ratings does Otter Tail Power require for its rebates?
A standard heat pump must reach at least 14.3 SEER2 and 7.5 HSPF2 to get the $300-per-ton base rebate. The equipment label shows SEER2 and HSPF2, which are the cooling and heating efficiency scores. Cold-climate models must reach a minimum of 16.0 SEER2 plus 8.0 HSPF2. That qualifies them for a $500-per-ton base rebate if ductless, or $700 per ton if ducted. Base rebates of $800 per ton are also open to air-to-water heat pumps, with a total up to $1,200 per ton.
Are heat pump and water heater rebates offered by Black Hills Energy?
Yes. When its residential electric customers install a heat pump water heater rated ENERGY STAR, Black Hills Energy pays $250 per unit. The utility web page lists two more eligible types: air-source heat pumps and ductless mini-splits with ratings of 15.2 SEER2 or higher. Before you buy, call the utility, because the heating rebate amounts on the 2026 form cannot be read.
How much is the Southeastern Electric Cooperative rebate on a ductless mini-split?
Install a ductless mini-split heat pump at home, and Southeastern Electric Cooperative will pay you a $300 rebate. Whole-home systems pay more: a standard air-to-air heat pump earns $600, and a ground source heat pump earns $800. To claim your payment, complete the Heat Pump Rebate Registration Form found on the cooperative's website.
Get South Dakota installer quotes with the rebates taken off
Most rebates on this page are paid through the installer or need the installer's paperwork, so the quote is where the money is settled. Tell us the ZIP code and what you want installed, and installers who work with these programs send a written price with the rebates taken off.