Clean Energy Tax Credits

Colorado has some of the best electrification tax credits in the country.

In 2023, I sponsored HB23-1272, which makes it easier than ever to make eco-friendly swaps in your home and on your commute.

Here’s a deep-dive into the many decarbonization incentives that Colorado has to offer.

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ELECTRIC VEHICLE INCENTIVES

COLORADO ELECTRIC VEHICLE TAX CREDIT

Thanks to work we did in the 2023 session, the Colorado Electric Vehicle (EV) Tax Credit is now the most generous state EV tax credit in the country.

Current incentives:

  • Coloradans can now access Colorado’s EV Tax Credit of $5,000 for the purchase or lease of a qualifying EV with MSRP up to $80,000. 

  • As of January 1, 2024, EVs under $35,000 MSRP are now eligible for an additional tax credit of $2,500, making the Colorado EV Tax Credit $7,500 for qualifying EVs under $35,000. 

Who’s eligible:

  • Colorado residents

VEHICLE EXCHANGE COLORADO PROGRAM

FEDERAL ELECTRIC VEHICLE TAX CREDITS

Some Colorado residents will soon be able to more than double their EV rebate simply by trading in their old or high-emitting vehicle for a qualifying EV. 

Current incentives:

  • Income-qualified Coloradans can replace their vehicle that is model year 2011 or older or fails a state emissions test with an EV and receive up to a $6,000 rebate for the purchase of a new EV or $4,000 for the purchase of a used EV.

Who’s eligible:

  • Income-qualified Coloradans. This applies to households currently enrolled in income-qualified programs or that earn less than 80% of the area median income. 

Learn more about the Vehicle Exchange Colorado (VXC) Program HERE.

Colorado residents can stack the Colorado EV tax credit and VXC rebate with Federal EV incentives for even more savings. 

Current incentives:

  • $7,500 tax credit for the purchase of a new qualifying EV with MSRP up to $80,000

Who’s eligible:

  • To receive the credit you must be below the income cap of: $150,000 for single filers, $225,000 for head of household, or $300,000 for joint filers 

Find more information on federal tax credits for the purchase of an EV HERE and answers to FAQs HERE.

ELECTRIC BIKE INCENTIVES

All people living in Colorado are now able to get the Colorado e-bike tax credit discount.

As of April 2024, Colorado has made the largest public investment in e-bike discounts in any North American state, city, or province.

Current incentives:

  • Coloradans can now receive a $450 point-of-sale discount on a qualified e-bike purchase from an authorized e-bike retailer through 2032.

Who’s eligible:

  • Colorado residents

Find more information on qualified e-bikes and participating retailers HERE.

ELECTRIC LAWN EQUIPMENT

Air quality alerts have become all too frequent in Colorado. We can do our part to lower emissions and improve air quality by making the switch to electric lawn equipment. 

Current incentives:

  • Coloradans can now receive a 30 percent point-of-sale discount on electric lawnmowers, leaf blowers, trimmers and snow blowers. 

Who’s eligible:

  • Colorado residents

Read more about Colorado's electric lawn equipment incentives HERE. 

HEAT PUMP INCENTIVES

Heat pumps are part of a dual-purpose heating and cooling system that can function as both an air conditioner and home furnace. But unlike a furnace, heat pumps don’t burn fossil fuels, saving owners an average of 20-40 percent on their annual utility bills. 

Current incentives:

Who’s eligible:

  • Colorado residents

Learn more about Colorado’s updated heat pump tax credits HERE.

Xcel Energy customers also may be eligible for a variety of heat pump rebates: 

  • Up to $1,000 in rebates for high-efficiency air source heat pumps

  • Up to $2,000 in rebates for high-efficiency ground source heat pumps 

  • Up to $600 for mini-split heat pumps