diff --git a/esphome/components/packages/__init__.py b/esphome/components/packages/__init__.py
index 7483d65b9d..67220cae08 100644
--- a/esphome/components/packages/__init__.py
+++ b/esphome/components/packages/__init__.py
@@ -1,6 +1,7 @@
 import re
 from pathlib import Path
 from esphome.core import EsphomeError
+from esphome.config_helpers import merge_config
 
 from esphome import git, yaml_util
 from esphome.const import (
@@ -18,26 +19,6 @@ import esphome.config_validation as cv
 DOMAIN = CONF_PACKAGES
 
 
-def _merge_package(full_old, full_new):
-    def merge(old, new):
-        # pylint: disable=no-else-return
-        if isinstance(new, dict):
-            if not isinstance(old, dict):
-                return new
-            res = old.copy()
-            for k, v in new.items():
-                res[k] = merge(old[k], v) if k in old else v
-            return res
-        elif isinstance(new, list):
-            if not isinstance(old, list):
-                return new
-            return old + new
-
-        return new
-
-    return merge(full_old, full_new)
-
-
 def validate_git_package(config: dict):
     new_config = config
     for key, conf in config.items():
@@ -167,7 +148,7 @@ def do_packages_pass(config: dict):
                     package_config = _process_base_package(package_config)
                 if isinstance(package_config, dict):
                     recursive_package = do_packages_pass(package_config)
-                config = _merge_package(recursive_package, config)
+                config = merge_config(recursive_package, config)
 
         del config[CONF_PACKAGES]
     return config
diff --git a/esphome/components/substitutions/__init__.py b/esphome/components/substitutions/__init__.py
index 0cef417c15..6188b14b35 100644
--- a/esphome/components/substitutions/__init__.py
+++ b/esphome/components/substitutions/__init__.py
@@ -5,6 +5,7 @@ import esphome.config_validation as cv
 from esphome import core
 from esphome.const import CONF_SUBSTITUTIONS
 from esphome.yaml_util import ESPHomeDataBase, make_data_base
+from esphome.config_helpers import merge_config
 
 CODEOWNERS = ["@esphome/core"]
 _LOGGER = logging.getLogger(__name__)
@@ -108,7 +109,7 @@ def _substitute_item(substitutions, item, path):
             if sub is not None:
                 item[k] = sub
         for old, new in replace_keys:
-            item[new] = item[old]
+            item[new] = merge_config(item.get(old), item.get(new))
             del item[old]
     elif isinstance(item, str):
         sub = _expand_substitutions(substitutions, item, path)
diff --git a/esphome/config_helpers.py b/esphome/config_helpers.py
index a88c5983b5..72362a3d73 100644
--- a/esphome/config_helpers.py
+++ b/esphome/config_helpers.py
@@ -23,3 +23,23 @@ def read_config_file(path):
         return data["content"]
 
     return read_file(path)
+
+
+def merge_config(full_old, full_new):
+    def merge(old, new):
+        # pylint: disable=no-else-return
+        if isinstance(new, dict):
+            if not isinstance(old, dict):
+                return new
+            res = old.copy()
+            for k, v in new.items():
+                res[k] = merge(old[k], v) if k in old else v
+            return res
+        elif isinstance(new, list):
+            if not isinstance(old, list):
+                return new
+            return old + new
+
+        return new
+
+    return merge(full_old, full_new)