Commercial HVAC incentives in NYC.

The commercial NYC incentive stack, one program at a time.

Five programs cover most of what makes a commercial heat pump retrofit pencil out in NYC. The two Con Edison tracks pay at install time, off the invoice. The federal items land at tax time: the figures below carry their IRS sources, and your tax advisor confirms how they apply to your project. C-PACE finances whatever residual the board or ownership wants to carry.

01
Con Edison C&I heat pump incentives
The commercial and industrial track pays per MMBtu: $120 for full building load space heating, $70 for phased load space heating, and $200 for domestic hot water, capped at 50% of project cost. New construction is out: other building electrification technologies installed in new construction projects are not eligible for incentives, in Con Edison's words. Con Edison ran a 2025 commercial limited-time offer and a 20 percent bonus that required submission before June 1, 2026; both are closed, so an older rate you find quoted elsewhere does not apply. Vinco files the application as a participating contractor and the incentive comes off the invoice.
02
Con Edison small business and nonprofit incentives
A separate track with flat per-project amounts for a qualifying cold climate air source heat pump, from up to $5,000 under 1,000 square feet to up to $12,500 at 2,001 to 2,500 square feet, plus $150 per MMBtu custom space heating and $200 per MMBtu custom hot water. In Con Edison's words, incentives are limited to 50% of project costs or $400,000, whichever is lower, and facilities must decommission their existing fossil-fuel heating system to qualify for heat pump incentives. The full tier table is below.
03
Section 179 expensing + bonus depreciation
Section 179 expenses eligible HVAC in year one, up to a 2026 limit of $2,560,000, with a phase-out above $4,090,000. Bonus depreciation covers the remaining qualifying property at 100 percent, made permanent for property acquired after January 19, 2025. A typical order of operations: Section 179 first, bonus depreciation on the balance. The Section 179D deduction is no longer part of the stack: it ended for property whose construction begins after June 30, 2026. Vinco produces the engineer documentation. Vinco does not give tax advice, so confirm with your tax advisor.
04
Section 48 Investment Tax Credit (commercial geothermal)
The federal Section 48 investment tax credit applies to commercial ground-source heat pump property, available for construction beginning before January 1, 2035. We publish no percentage figures here; confirm with your tax advisor what applies to your project. On the utility side, Con Edison runs a separate non-residential geothermal track with its own per-MMBtu rates. The geothermal page carries the full breakdown.
05
NYC C-PACE financing
Commercial Property Assessed Clean Energy financing can cover qualifying HVAC and envelope work with long-term financing repaid through a property tax assessment that survives ownership transfer. Terms are set by the program and the lender, not by us, so confirm current terms with the program administrator. Vinco produces the engineer documentation the application needs.

Sources: Con Edison C&I heat pump incentives · small business incentives factsheet · IRS Rev. Proc. 2025-32 · IRS bonus depreciation guidance · 26 U.S.C. 48 · IRS OBBBA FAQs · cleanheat.ny.gov · rates verified 2026-09-25

C&I versus small business, rate by rate.

Every figure in this section was verified against Con Edison's published C&I schedule and the small business incentives factsheet on September 25, 2026. Which track a building files under depends on the Con Edison account; the program documents define eligibility, and Vinco confirms the track during the estimate.

Commercial and industrial (C&I)

The C&I incentive is capped at 50% of project cost, and other building electrification technologies installed in new construction projects are not eligible for incentives.

Small business and nonprofit, ccASHP per project

In Con Edison's words, incentives are limited to 50% of project costs or $400,000, whichever is lower, and facilities must decommission their existing fossil-fuel heating system to qualify for heat pump incentives. The 2025 commercial limited-time offer on this track is closed; the rates above are the current published ones.

What Vinco does, what the building owner does.

Most commercial building owners do not apply for anything directly. The Clean Heat application and the engineer documentation run through Vinco as the participating contractor. The owner approves the proposal, signs the contract, and files the federal deductions at tax time. The tax advisor runs Section 179 and bonus depreciation on the corporate return.

Sequence: free site visit and load calculation. The heat pump has to appear on the NEEP Cold Climate Air Source Heat Pump Product List, and the engineering package carries ACCA Manual J 8th edition loads and ACCA Manual S sizing. Vinco confirms which Con Edison track the building files under, then issues an engineered proposal with the incentive line and the net price after the discount. Owner approves. Vinco files the application and runs the Con Edison review and inspection cycle. NYC DOB permits filed under license #022359. Install. Post-inspection. The incentive is netted against the final invoice. The CPA claims the federal deductions on the return.

For Local Law 97 covered buildings, the compliance angle pulls the timing forward. A covered building over its annual emissions limit owes (actual emissions minus the limit) times $268 per metric ton of CO2e, per year, in the Department of Buildings' formula, and the exposure repeats every year the building stays over. An electrification that removes fossil fuel from the heating plant cuts it at the source while the Con Edison incentive is still on the table. Read the full breakdown at /local-law-97-hvac.

Costs and labor rates, before the visit.

Commercial estimates are free. The labor rate sheet, the diagnostic fee for service calls on existing equipment, and the financing terms are all published.