For one Minnesotan, a new heat pump brings comfort and savings
Palmer’s heat pump also reduces her family’s exposure to toxic pollutants emitted by burning gas. She noted that access to clean air is particularly important for her daughter who has asthma. What’s more, Palmer is thrilled to be taking action to help fight climate change, the effects of which she’s already feeling. She and her family spend a lot of time outside in northern Minnesota’s shimmering Boundary Waters, she told me. In 2023 and 2024, choking smoke from wildfires in Canada made worse by climate change was a “wake-up call,” Palmer said. “If we can’t be outside enjoying the summers here, then that’s really impacting my life and also my granddaughters’ lives.” In Minnesota, switching to a cold-climate heat pump can make a huge difference in annual household emissions, cutting them by an estimated 8.2 metric tons of CO₂ equivalent per year, according to a 2024 study by the National Renewable Energy Laboratory. That’s like not driving a car in the U.S. for nearly two years. If Minnesota fulfills its commitment to get 100% clean power by 2040, the emissions savings from switching to a heat pump could be even greater. Heat-pump costs — and savings Palmer’s heat-pump system cost about $25,000, but two big incentives lowered the sticker price: the $2,000 federal tax credit and a $1,600 rebate from utility Xcel Energy. Installing an AC-only system would have cost around as much, according to Bender. In fact, incentives typically make it “a little cheaper to put in the heat pump than the AC” for Minnesota homes broadly. Thanks to a utility incentive, Palmer will reap ongoing savings. Xcel drops the electricity rate for households with electric heating from 11 cents per kilowatt-hour to 8 cents per kilowatt-hour — a 27% discount — on all the electricity they use during the heating season of October through May. Perhaps most importantly, the heat pump has significantly reduced how much Palmer uses her 30-year-old gas boiler system.“I didn’t turn on my radiators until December,” Palmer said. “Usually in Minnesota, I would have turned them on in September.” Bender expects the heat pump to save Palmer $500 to $800 annually. “In these older homes, there’s a lot of savings to be had” because of how inefficient existing systems can be, he said. Looking ahead, Palmer is considering going to an all-electric heat system. The lowest-cost option in that scenario would likely entail taking out the boiler and radiators, installing ducts, upgrading the electrical panel, adding more heat-pump equipment, and using electric-resistance heat strips for extra heat on demand — at a potential cost of $35,000 to $40,000, Bender said. However, Palmer would avoid spending $15,000 on a replacement boiler, he pointed out. She’d also be able to take advantage of incentives for such a project, which are currently a whopping $7,100 for someone living in Minneapolis. Going all-electric tends to be easier in newer homes, Bender said. In a 1980s Minneapolis home with ductwork and a 200-amp panel, for example, choosing an all-electric system over a hybrid gas-and-electric system may cost just $2,000 to $3,000 more. As for Palmer, her new heat-pump system is already attracting notice in her social circle, she said. One intrigued friend recently swung by to check it out for himself.
Kathy Palmer was intrigued when her neighbor, an environmental lawyer she’d met while volunteering on a Minneapolis climate committee, sang the praises of the new heat pump he had installed in his home. Now, Palmer is enjoying the warmth of her own heat pump. For the past three decades, the 72-year-old retired…
Palmer’s heat pump also reduces her family’s exposure to toxic pollutants emitted by burning gas. She noted that access to clean air is particularly important for her daughter who has asthma.
What’s more, Palmer is thrilled to be taking action to help fight climate change, the effects of which she’s already feeling. She and her family spend a lot of time outside in northern Minnesota’s shimmering Boundary Waters, she told me. In 2023 and 2024, choking smoke from wildfires in Canada made worse by climate change was a “wake-up call,” Palmer said. “If we can’t be outside enjoying the summers here, then that’s really impacting my life and also my granddaughters’ lives.”
In Minnesota, switching to a cold-climate heat pump can make a huge difference in annual household emissions, cutting them by an estimated 8.2 metric tons of CO₂ equivalent per year, according to a 2024 study by the National Renewable Energy Laboratory. That’s like not driving a car in the U.S. for nearly two years.
If Minnesota fulfills its commitment to get 100% clean power by 2040, the emissions savings from switching to a heat pump could be even greater.
Heat-pump costs — and savings
Palmer’s heat-pump system cost about $25,000, but two big incentives lowered the sticker price: the $2,000 federal tax credit and a $1,600 rebate from utility Xcel Energy.
Installing an AC-only system would have cost around as much, according to Bender. In fact, incentives typically make it “a little cheaper to put in the heat pump than the AC” for Minnesota homes broadly.
Thanks to a utility incentive, Palmer will reap ongoing savings. Xcel drops the electricity rate for households with electric heating from 11 cents per kilowatt-hour to 8 cents per kilowatt-hour — a 27% discount — on all the electricity they use during the heating season of October through May.
Perhaps most importantly, the heat pump has significantly reduced how much Palmer uses her 30-year-old gas boiler system.“I didn’t turn on my radiators until December,” Palmer said. “Usually in Minnesota, I would have turned them on in September.”
Bender expects the heat pump to save Palmer $500 to $800 annually. “In these older homes, there’s a lot of savings to be had” because of how inefficient existing systems can be, he said.
Looking ahead, Palmer is considering going to an all-electric heat system. The lowest-cost option in that scenario would likely entail taking out the boiler and radiators, installing ducts, upgrading the electrical panel, adding more heat-pump equipment, and using electric-resistance heat strips for extra heat on demand — at a potential cost of $35,000 to $40,000, Bender said. However, Palmer would avoid spending $15,000 on a replacement boiler, he pointed out. She’d also be able to take advantage of incentives for such a project, which are currently a whopping $7,100 for someone living in Minneapolis.
Going all-electric tends to be easier in newer homes, Bender said. In a 1980s Minneapolis home with ductwork and a 200-amp panel, for example, choosing an all-electric system over a hybrid gas-and-electric system may cost just $2,000 to $3,000 more.
As for Palmer, her new heat-pump system is already attracting notice in her social circle, she said. One intrigued friend recently swung by to check it out for himself.