PSE&G Building Decarbonization — Hybrid Heat

PSE&G Building Decarbonization — Hybrid Heat

What it covers

The entry-level tier of PSE&G's Building Decarbonization (BD) program. Hybrid Heat pays a homeowner to replace their air conditioner with a heat pump while keeping the existing fossil heating system entirely in place. The heat pump primarily handles cooling, with limited shoulder-season heating capability.

• Base: 30% of project cost up to $2,000.
• LMI: 40% of project cost up to $3,000 (income-qualified — household income at or below $80,000).

Adder stacks on top:

• $1,500 integrated controls allowance.

OBR financing available up to $25,000 for the remaining project cost — note this is the standard cap, not the $50K heat-pump cap that applies to Clean Heat and Dual Heat. Hybrid Heat doesn't qualify for the extended OBR limit because the project doesn't meaningfully decarbonize heating.

Eligibility

• Active PSE&G electric residential account.
• Single-family, townhomes, or multi-family up to 4 units.
• Retrofit only — not eligible for new construction.
• Existing air conditioning is being replaced with a heat pump; existing fossil heating system stays untouched.
• Equipment must meet PSE&G's heat pump efficiency spec.
• LMI tier ($3K) requires income verification through PSE&G's process.

Stacks with

• NJ Whole Home Energy Solutions runs as a concurrent but separate project. Heating/cooling comes out of Whole Home scope when BD covers it — reducing the Whole Home rebate but adding the BD rebate. Per rules/bd-stackability-rules.md, the two rebates do NOT sum; agent presents the split-scope trade-off.
• OBR financing stacks with Whole Home up to $50,000 combined ($25K Whole Home + $25K Hybrid Heat — Hybrid Heat does NOT qualify for the extended $50K heat-pump OBR cap).

Does NOT stack with

• PSE&G BD Clean Heat — same exclusiveGroup: "pseg-bd". Engine picks the highest-value BD program per project, so Clean Heat ($10K) and Dual Heat ($5K) both win over Hybrid Heat ($2K) when applicable.
• PSE&G BD Dual Heat — same exclusive group; mutually exclusive with Hybrid Heat.
• PSE&G $900 equipment-only heat pump rebate — conservative default per bd-stackability-rules: do not assume both apply to the same heat pump install.

Edge cases

• OBR cap is $25K not $50K: this is the only BD tier where the standard OBR cap applies. Don't promise the extended $50K limit on Hybrid Heat projects.
• LMI surfacing: $3K tier should be presented as upsell, not headline ("you may qualify for $3,000 if household income is under $80K — verified during your free consultation"). Never apply to default headline numbers.
• Why pick Hybrid Heat at all: this is the right path for homeowners who need to replace an aging AC and want to dip into electrification incrementally without touching their heating system. Lowest commitment, lowest rebate.
• Engine deduplication: when a homeowner is eligible for any higher BD tier, the engine surfaces only the highest-value option (Clean Heat > Dual Heat > Hybrid Heat).

Recommended for

• PSE&G electric customers whose AC is at end-of-life and who want a small electrification step without rethinking their heating system.
• Homeowners with a recently installed fossil furnace/boiler that they want to keep using for years.
• A fallback in the agent's reasoning when both Clean Heat and Dual Heat are ruled out (e.g., the homeowner explicitly wants to keep heating fossil and only the AC is being replaced).
• Use as a comparison point to motivate the bigger BD tracks: "Hybrid Heat = $2K and you're stuck with fossil heating costs. Dual Heat = $5K and you offset most of your fuel bill. Clean Heat = $10K+ and you're done with fossil."