AC Installation Costs in 2025: What Homeowners in Denver & Littleton Should Expect

Posted On May 7, 2025

As the weather starts to heat up in Denver and Littleton, it’s a good opportunity to start planning out your new air conditioner installation. By researching the AC installation cost in 2025, you can find the best deals and ensure you get the exact system you need. 

When the weather gets hot, everyone rushes to have their ACs installed or replaced. Because of this, you should plan ahead for your next AC installation in Denver. With the help of our experienced heating, ventilation, and air conditioning (HVAC) professionals, you can set up a new air conditioner and enjoy a cool, comfortable summer.

At Elkhorn Heating, Air Conditioning, Plumbing & Electrical, we offer comprehensive services for local homeowners and businesses. With so many changes to technology and regulations, you need an HVAC expert on your side. Learn more about getting an AC installation in Colorado by giving us a call today.

Average AC Installation Costs in 2025

If you’ve been considering a new AC installation, it’s essential to check out the air conditioner installation cost beforehand. The cost of your unit is going to vary based on where you are located, your existing ductwork, rebates, and similar factors. Over the years, we’ve installed many different HVAC units in Colorado. Because of this, we have a good understanding of which factors are going to increase or decrease your overall costs.

As a general rule, we’ve found that the following factors play a major role in the cost to install an AC system.

• Rebates and tax credits
• Brand and model
• Line set protection
• AC size and capacity
• Ductwork installation requirements
• Additional HVAC equipment needed 

Because of all of these factors, there’s no hard-and-fast rule about how much a new AC installation will cost. In general, you can expect your central AC installation to run between $7,000 and $12,000. However, there can be larger variations in cost between different unit types.

AC Type	Average Cost Range
Central Air Conditioner	$7,000 – $12,000
Ductless Mini-Split	$3,200 – $13,000
Heat Pump	$8,000 – $12,000

Factors Affecting AC Installation Costs

From your ductwork requirements to the AC’s capacity, there are a range of things that impact what your HVAC installation cost will be. These factors are based on your personal needs and requirements, so your end price will vary. 

Once you reach out to our expert HVAC technicians, we can quickly help you determine which AC installation is right for your needs. We’ll determine the capacity that your home needs and make adjustments based on the building’s orientation, existing insulation, and similar factors. As a general rule, you can expect the following qualities to impact your AC installation cost in 2025.

Brand and Model

Like any other consumer product, air conditioners have different brands and models. Naturally, some of these cost more than others. While some of the highest-priced brands are worth the money, this isn’t always the case. 

By working with Elkhorn Heating, Air Conditioning, Plumbing & Electrical, you can figure out which brand is the right choice for your unique situation. We’ll review the different AC installation options for your home, so you get the best possible results for your budget.

Ductwork Installations

If you do not have existing ductwork in your home, the cost of installing new ductwork can quickly add up. 300 linear feet of ductwork generally costs between $3,000 and $7,500. 

However, many homes already have existing ductwork installed. When we evaluate your home for a new AC installation, we’ll check the existing ducts to make sure they are in good shape. 20% to 30% of the average home’s cool air is lost through leaky ducts, which is why you need the highest quality of ductwork possible. If you don’t have existing ductwork, you can also get ductless mini-splits installed because mini-splits don’t rely on ducts.

System Size and Capacity 

When picking a new air conditioning unit, one of the biggest factors in determining the new AC unit cost is its size. Typically, we measure an AC’s capacity through British Thermal Units (BTUs) or tons. There are 12,000 BTUs in every ton of cooling capacity. 

With your new central air installation, we will begin by figuring out the AC load involved. This is made up of things like the internal load, design, and thermal enclosures. To be accurate, we also must consider the orientation of your house and the number of windows as well. 

After we’ve calculated the AC load, the next step is getting an AC installation that has the exact load size you need. If your AC has a capacity that’s too low, it will have to run constantly to maintain the temperature at an appropriate level. This can cause it to wear down prematurely. 

When the capacity is higher than it needs to be, then it will reach the cooling point too quickly and shut off. Eventually, this short cycling can cause it to malfunction.

Energy Efficiency Ratings (SEER2)

When calculating the cost of your AC installation in Denver, you also need to look at the Seasonal Energy Efficiency Ratio 2 (SEER2) rating. Over the years, technology has improved significantly, making modern HVAC units much more energy-efficient than they were in the past. 

To calculate the SEER2, HVAC companies use the following formula.

SEER2 = Total Cooling Output (BTUs) / Total Electrical Energy Input (watt-hours)

The SEER2 rating is basically a way to demonstrate a unit’s energy-efficiency level. If the rating is higher, it means that the AC is able to remove more heat from the air. Over time, having a more energy-efficient AC can lead to significantly lower power bills.

Your Local Geography and Climate

Next, your geography can play a major role in the cost to install an AC system in your home. For example, Denver has a minimum wage of $18.81 per hour. This is almost three times as much as it is in some parts of the country, so labor costs will naturally be higher in Denver than they are in other places. Similarly, overhead expenses and rent will cost the HVAC company more, leading to higher overall prices. 

The climate in your area also has an impact on the overall cost. When the climate is especially humid, you may need to have a dehumidifier installed. A dry climate may require a humidifier, increasing the overall price. Additionally, unusually hot climates often require an AC with a higher capacity, which can increase the cost you end up paying.

Installation Complexity

Next, you need to figure out the installation complexity involved. If your installation is going to be in a hard-to-reach spot or requires specialized equipment, it’s going to cost more. Anything that increases the labor hours or materials required also increases the overall cost of the project.

Additional Costs To Consider

Besides thinking about your installation complexity and your geography area, there are other factors that can immediately impact the cost of your project. While some of these, like thermostat upgrades, are up to you, permits and similar considerations are unavoidable. To make budgeting for the AC installation in Littleton a little easier, we’ll carefully cover all of the AC replacement and installation costs you can expect before the installation actually happens.

• Thermostat Upgrades: When you get a new installation, you should also think about upgrading your thermostat at the same time. Smart and programmable thermostats are incredibly energy efficient, so you can enjoy having a lower power bill. With a smart thermostat, you can also enjoy the added convenience of being able to change the temperature from anywhere your smartphone has service.
• Permits: In many cases, permits are simply unavoidable. Many cities require permits and inspections if you are going to do major updates to your HVAC systems. If you are unsure about the rules in your area, you can always ask one of our HVAC technicians about what to expect.
• Equipment Removal and Disposal: If you have old equipment at your home, it will likely need to be removed before you get a new central air installation. One of our HVAC technicians can deal with the disposal of your old equipment so that you don’t have to worry about it.
• Electrical Panel Replacements: Old electrical panels simply weren’t designed for all of the electrical appliances and devices used by modern households. Because of this, it is often a good idea to get your electrical panel replaced. Additionally, you should consider a replacement if it frequently trips or causes power surges in your home.

Impact of 2025 EPA Refrigerant Regulations

Starting on January 1, 2025, no new cooling systems can be created or installed that use R-410A. However, old ACs and heat pumps can still be serviced and repaired. New HVAC installations must use alternative types of refrigerants, such as R-32 and R-454B. 

Businesses and homeowners throughout the country are trying to switch over to R-32 and R-454B, so there may be supply chain delays this year. According to some estimates, these delays may end up increasing the cost to install AC systems by 10% to 15%. To avoid supply chain delays, it’s important to be proactive about ordering your AC early and locking in a good price.

Federal Tax Credits and Rebates

As a Colorado homeowner, there are a few things you can do to lower the overall new AC unit cost. With federal tax credits and rebates, you can get money back from your new HVAC system. Each program is different, so you need to be proactive about researching and applying for different rebates.

One of the most common tax credits for AC installations in Denver is the Energy Efficiency Home Improvement Credit. This federal credit is nonrefundable and will give you as much as 30% of your installation costs back. The credit is in effect for all purchases that were made after January 1, 2023, so it still works for 2025 purchases.

Through the Energy Efficient Home Improvement Credit, you can get money for a range of different energy-efficient improvements. For example, you can get a credit worth up to $600 for your windows. You can also claim as much as $250 per door or $500 for all of your doors. Similarly, there is a $600 credit for skylights.

Even if you performed every type of installation and update possible, the credit is only good for a maximum of $3,200. Specific product types have additional limits. For instance, heat pumps and boilers can only receive a maximum of $2,000 per year. Air conditioning units can qualify for as much as $600.

Before you get new systems installed, it is always a good idea to conduct a home energy audit. Once your audit is conducted, you can get up to $150 of the cost back through the federal tax credit.

Colorado is unique because it offers additional credits and rebates. The Colorado Energy Office advertises a heat pump credit that is available upfront through the HVAC contractor.

If you are researching your air conditioner’s installation cost, our team can help you review different types of credits. We have years of experience working with HVAC units in Colorado, so we know where to go for credits and rebates.

When To Repair vs. Replace Your AC

While routine maintenance can significantly extend the lifespan of your air conditioner, every HVAC unit will eventually need to be replaced. The real question is how long you can extend your unit’s lifespan until it needs a replacement.

As a homeowner, it can be challenging to figure out when you need to get your air conditioning unit replaced or repaired. If you need help, one of our HVAC technicians can review the state of your AC and diagnose any problems. Then, we can discuss our top recommendations. 

In general, you can use the following factors to determine when an air conditioning unit needs to be repaired or replaced.

• Age: An average air conditioner or heat pump will only last for around 10 to 15 years. If your AC breaks down after you reach the 10-year mark, it’s likely time to get it replaced. 
• Performance: Your AC is supposed to evenly cool every room of your home. If there are hot spots in some areas or your AC struggles to cool off your home, you may need a new one. At the very least, you should call one of our HVAC technicians to get your AC repaired.
• Energy Efficiency: Newer air conditioners have a better level of energy efficiency, so you could likely save money by updating your model. Plus, energy efficiency matters in another way as well. If your energy bills suddenly increase for no explainable reason, it’s a good sign that there is a problem with your HVAC system.
• Frequent Repairs: When air conditioners start to break down, you’ll often notice common signs and symptoms. One of the most obvious signs is how often you’re performing repairs. Frequent repairs are an indication that your cooling system is reaching the end of its natural lifespan. 

If you are still uncertain about replacing or repairing your AC, you can try using the $5,000 rule. First, take the age of your air conditioning unit. Then, multiply this figure by the cost of the repair. If the resulting number is higher than $5,000, it’s time to get a new AC installation in Littleton.

After you install a new air conditioner, the next step is making sure you don’t have to replace your air conditioner in the near future. With our membership plan, you can get biannual tune-ups. These tune-ups help to prevent unexpected breakdowns and costly repairs. Through timely maintenance, you can extend the lifespan of your air conditioner. 

Tips for Saving on AC Installations

Rebates and tax credits are one of the best ways to save money on your new AC unit cost. In addition to these methods, there are a few important tips you can use to reduce the overall HVAC installation cost for your home.

Take Advantage of Our Financing Options 

When it comes to HVAC units, it’s incredibly difficult to plan ahead for your next purchase. For many homeowners, a new AC simply isn’t in the monthly budget. 

We know how challenging it can be to find funding at the last minute, which is why we offer a range of affordable financing options. For example, our lending partners offer 0% interest, short-term loans as well as longer loan options, so you can find a program that suits your family’s needs.

Request Multiple Quotes

If you were shopping for furniture, you’d likely visit multiple websites or shops before deciding on a purchase. The same concept is true for HVAC systems. A reputable HVAC company is happy to provide a free estimate for the AC installation cost. Afterward, you can compare quotes to see which one has the services and budget you need. 

Find Rebates

One of the major ways to save on your AC installation cost in 2025 is through the federal tax credit, which gives you up to 30% back. However, there are other potential rebates as well. Before you make any purchase, carefully look up the rebates that are available in your city and state. Then, make sure you buy an air conditioner that meets the rebate requirements. With a little advance planning, you can end up saving a significant amount of money in the long run. 

Check for Manufacturers’ Promotions

Manufacturers’ promotions are ideal if you know that you will need a replacement in the next year or two. Once you start thinking about the possibility of a new AC unit, you can begin scouring your favorite brands for potential sales. At Elkhorn, we keep track of all of our sales and specials in one place, so you can easily find options that will reduce your overall bill.

Conduct a Home Energy Audit 

If you are trying to maximize your budget, a home energy audit is a good step. During the audit, the technician will look for problem areas, like windows and doors, that are allowing conditioned air to escape. Once they’ve determined what type of energy-efficiency issues your home is experiencing, they’ll give you a finished report. Then, you can use this report to plan out the changes that you want to carry out. 

As an added benefit, getting a home energy audit performed may save you money on your tax bill. When you file taxes next year, you are allowed to claim 30% of your audit costs, up to $150.

Get Your Installation During the Off-Season

HVAC units are more likely to break down when they are being used the most. Because of this, more people tend to get AC repairs and replacements during the hottest months of summer. This added demand can increase the cost of services. For a potentially lower price, try to get your installation work completed during the off-season.

Don’t Forget About Your Tune-Up

Over time, your AC will become dirty. Parts will suffer from wear and tear. While you can change your AC filter on your own, other maintenance tasks should be handled by an expert.

We recommend getting your AC tune-up completed each spring before the busy season arrives. During the tune-up, we’ll clean your AC, lubricate moving parts, and look for potential signs of a problem. All of these activities can prevent malfunctioning components and increase the longevity of your air conditioning unit.

Schedule a Top AC Installation in Denver and Littleton 

If you’re researching the AC installation cost in 2025, we can help. Over the years, we’ve assisted many businesses and local homeowners in finding the right AC installations. Before each AC installation in Denver, we carefully calculate your home’s energy needs and the required capacity. Then, we can work with you to find the best installation option.

Thanks to our personalized services, we’ve built a reputation as one of the best HVAC providers in the area. Learn more about AC installation in Denver & Littleton by reaching out to our team of HVAC experts today.