$1000 for a 3600sqft house is about right. My last bill was around $350 for a 1400 sqft with all heat pump and your house is almost 2.5x bigger than mine. You're spending a lot of money to heat a lot of empty rooms unless your household is huge. Upgrading to a new system will add more bills, especially if you're not qualified for mass save which I don't know how that's possible... I thought the rebate was for everyone.

The only way to lower those bills is going to be through labor. Install a fireplace insert and freestanding wood stove and start chopping woods. There are tons of people who would love to give you free wood if you can remove their logs and split it yourself.