How to Lower Your Heating Bill in Colorado This Winter

By the team at Homegrown Heating and Air Conditioning.

The fastest way to lower your heating bill in Colorado is to shorten how long the furnace runs, and the cheapest lever for that is a setback schedule you actually keep. The Department of Energy puts the saving at around 10 percent a year on heating and cooling by turning the thermostat back 10 to 15 degrees F for eight hours.

Everything after that costs money, and the order matters. Below is the ranked list, with what each move realistically does, and the local numbers that explain why your winter bill behaves the way it does here.

Why a Heating Bill in Colorado Is a Ten to One Problem

A heating degree day is not a temperature. It is a measure of how much heating a day demanded. Take the average outdoor temperature for the day, subtract it from a 65 degrees F base, and the difference is that day’s heating degree days. A 45 degree day scores 20. A 15 degree day scores 50.

That is why degree days predict a bill better than any single morning does. Your furnace does not respond to the low temperature. It responds to how far below 65 the day sat, and for how long.

The NOAA monthly climate normals for the Fort Collins station put the annual total at 5,918 heating degree days against 569 cooling degree days. Heating is roughly a ten to one problem against cooling in this market, and the heating season effectively runs September through May.

Month	Heating degree days
September	138
October	461
November	790
December	1,077
January	1,052

Read that table as a bill forecast. October carries more than three times September’s load, and November nearly six times. The jump people notice in their November and December statements is not a billing error. It is the climate normal doing exactly what it does every year.

It also tells you when work pays. A measure installed in September earns across the whole 5,918. The same measure installed in February catches maybe a third of it.

What You Are Paying Per Therm Changed in October

Rates moved this year as well. The Colorado Public Utilities Commission reached a final decision on September 4, 2026 in Proceeding No. 25AL-0538G, approving a settlement that raises Xcel Energy residential natural gas rates by 8.6 percent, about $5.16 a month, effective October 6, 2026. The Commission cut that down from the 11.4 percent and $7.59 Xcel originally requested.

So a bill that rises this winter is carrying two separate things: more degree days than the shoulder months, and a higher rate per unit. Only one of those is inside your control.

Start With What Costs Nothing

Set a real setback schedule. The DOE figure of around 10 percent a year assumes a genuine eight-hour setback of 10 to 15 degrees F, usually overnight or while the house is empty. A thermostat you override every evening is not a setback.

Change the filter on a schedule. Manufacturers typically recommend replacement every 60 to 90 days. A loaded filter does not just cost efficiency, it raises static pressure, lengthens run times and trips high limits.

Open the registers and clear the returns. Closing vents in unused rooms does not save gas. It raises duct pressure and pushes more air out through the leaks you already have.

Reverse the ceiling fans and leave them slow. Minor, but free.

Then Seal the House and the Ducts

This is where the money starts working. About 20 to 30 percent of the air moving through a typical duct system is lost to leaks, holes and poor connections, which means a share of what you paid to heat never reaches a room.

Duct sealing, air sealing and insulation are also the measures your utility pays for, and which program you use depends on who sends your bill. All figures below are current as of September 21, 2026 and change often.

• Fort Collins, Loveland and Estes Park are municipal electric, and residential rebates run through Efficiency Works: attic insulation at $0.77 per square foot, wall, basement and crawlspace at $1.16 per square foot, and blower-door verified air sealing from $310 to $770 by reduction tier.
• Xcel Energy customers use a separate program: air sealing at 30 percent of cost capped at $400, attic insulation capped at $500, wall insulation capped at $350, with gas-heat customers receiving 1.5 times those amounts.
• Efficiency Works requires a listed provider, a home at least one year old, and an application within 45 days, with pre-approval above $2,500.

We handle ductwork repair and sealing in-house, and a smart thermostat installation is the cheapest way to make the setback automatic rather than optional.

Equipment Is the Last Lever, Not the First

Replacing the furnace is the most expensive move on this list, so it belongs at the end unless the equipment is already failing. Two corrections worth knowing before anyone quotes you.

There is no federal tax credit for a furnace, air conditioner or heat pump installed in 2026. The federal 25C credit covered improvements made through December 31, 2025 and has not been replaced. Anyone still offering it is working from old material.

The federal minimum efficiency for a new gas furnace is 80 percent AFUE today. The 95 percent rule applies to units manufactured on or after December 18, 2028, and that date is under an active federal petition. High efficiency is often the right call here given the degree day load, but it is a choice, not a current requirement.

What does exist in Colorado right now is the state heat pump tax credit, and it does not work like a tax credit at all. We at Homegrown Heating and Air Conditioning are a registered contractor with the Colorado Energy Office, so we claim it and pass the discount straight through on your invoice. You file nothing. For 2026 that is a $1,000 credit on an air-source heat pump with at least $333 appearing as an upfront discount, $2,000 with at least $667 on ground, water or combined source, and $250 with at least $83 on a heat pump water heater. Equipment has to be ENERGY STAR certified and air-source systems have to be AHRI-matched.

Xcel also still pays $225 on a 95 percent or better AFUE furnace replacing a non-condensing unit, and that rebate ends January 1, 2027. If a replacement is already on your list, the calendar matters. A heating maintenance visit is the honest first step either way, because it tells you whether you are looking at a heating repair or a replacement. Homeowners across Greeley sit on a different utility mix again, Xcel for electricity and Atmos for gas, which changes which of these programs apply.

A Replacement That Made the Rebate Deadline

Rebate and credit programs run on dates, and a job that finishes a week late can miss a window entirely. One family called us to replace both the air conditioner and the furnace at their mother’s home, with a rebate deadline already in view. Peter, Phil and Kim scheduled the work around that date and got the paperwork in.

Niki Taylor wrote: “Every person we interacted with was helpful, knowledgeable and went above and beyond, including ensuring that we were able to meet a deadline for a rebate.”

Checking program deadlines before we schedule is part of how we quote, not a favor. We are licensed and insured throughout Northern Colorado, and we confirm which programs apply to your address before the work is booked. Read more customer reviews from Northern Colorado homeowners.

Book a Visit to Lower Your Heating Bill

Tell us what your bill is doing and how old the equipment is. Contact Homegrown Heating and Air Conditioning to book a visit anywhere in Northern Colorado.

Lower Heating Bill Questions From Northern Colorado Homeowners

Why did my bill jump so much between October and December?

Because the load roughly doubled. Fort Collins normals run 461 heating degree days in October and 1,077 in December. Your furnace ran more than twice as long for the same thermostat setting, and this year a higher gas rate landed on top of that.

How much will a setback schedule actually save me?

The Department of Energy estimate is around 10 percent a year on heating and cooling for a genuine eight-hour setback of 10 to 15 degrees F. In a market with 5,918 heating degree days, the heating share of that is the larger half by a wide margin.

Does closing vents in spare bedrooms lower my bill?

No. It raises static pressure in the duct system, which pushes more air out through existing leaks and can trip the furnace high limit. If a room is truly unused, the fix is balancing or zoning, not a closed register.

Which rebate program applies to my house?

It depends on your utility, not your city name alone. Fort Collins, Loveland and Estes Park run through Efficiency Works. Xcel customers use Xcel’s program. Poudre Valley REA serves parts of Windsor, Berthoud, Timnath, Wellington and Laporte with its own electric-only structure. We check the address before quoting.

Is there still a federal tax credit for a new furnace in 2026?

No. The federal 25C credit applied to improvements made through December 31, 2025. The Colorado heat pump credit is separate, it is still active, and it reaches you as a discount on our invoice rather than as something you file.

When is the best time to do this work?

Before November if you can. October alone carries 461 heating degree days and November 790, so a measure completed in early fall earns across nearly the whole season instead of the tail of it.