The federal government is currently offering two different tax credits: the energy efficiency federal income tax credit and the renewable energy federal tax credit.

If you install a geothermal heat pump to your principal or secondary residence, you could qualify for the renewable federal income tax credit, which continues until Dec. 31, 2016. The credit is equal to 30 percent of the cost and installation with no upper limit. To be eligible for this tax credit, you must owe money on your taxes. However, if you are unable to claim the entire 30 percent of your renewable energy purchase, you can carry forward the unclaimed portion to future years.

Other eligible measures under this tax credit include solar water heaters, solar panels, and wind generators. Fuel cells also qualify but there is a cap of $500 per 0.5 kilowatts of power capacity, and improvements must be on your primary residence.