Hot Market For Heat Pumps

What is a heat pump?

If you’ve ever stood outside where an air conditioner vents, you know that air conditioners have to do something with the heat they remove from inside. An AC system moves heat from a cool space indoors to the hot air outdoors. A heat pump does the same thing; the only difference is that it moves the heat from the cool air outdoors to a warm space indoors. In 1997, 6.8% of residential heat demand in the U.S. was supplied by heat pumps.[1] The only country with greater use of home heat pumps was Japan. (See sidebar on heating in other countries.)

The best way to envision how a heat pump works is to think of a refrigerator. One set of coils is located in the refrigerator, the other outside the refrigerator. The “pump” in “heat pump” refers to the pump that moves a liquid, known as the working liquid or refrigerant. The “heat” is embodied in the working liquid as stored energy. The coils inside the refrigerator have enough surface area to expose the liquid to excess heat, which causes it to expand. The pump also causes additional expansion, forcing the liquid to absorb more heat. The liquid is then forced through the coils on the exterior of the refrigerator, where it is compressed so that it gives off heat. The same liquid then repeats the cycle. Instead of moving heat out of a room, like an air conditioner, the process moves heat out of the insulated refrigerator. So the overall effect is that heat is being pumped from one location to another.

Want to learn more? Visit the Natural Resources Canada’s website on heat pumps:

In the summer, an air conditioner makes your house like a very large refrigerator, only not as cold. In the winter, a heat pump can do the reverse, taking heat out of the exterior environment and transferring it inside. Even though it seems cold outside, the heat pump can capture some of the heat energy that is stored in the air. Air at 0°F still contains nearly 85% of the heat that it contains at 70°F. Because a heat pump is only moving heat instead of making new heat, it is much more efficient than direct heating (like electric baseboard heaters), easily able to transfer two to three times as much heat as can be directly generated with the same amount of electricity.

Practical applications of heat pumps

A heat pump that can both heat and cool is called a split system. It transfers heat outside during summer like an air conditioner, and operates in reverse in winter, pumping heat in from the air.

In most cases, a heat pump supplements another heating system and enables it to operate more efficiently. One can be added to an existing home to improve heating efficiency. It may also eliminate the need for central air conditioning. Some systems also provide heating for hot water and clothes dryers.

Factors that can effect the life-cycle efficiency of a heat pump

Local method of electricity generation


Type of heat pump (ground vs. air source)

Refrigerant used

Thermostat controls

Size of the heat pump

Quality of work during installation

Energy efficiency of home's layout, insulation and ducts

Safeguards against damage to coils from construction, gardening equipment, etc.

Heat pumps have different levels of popularity in different areas depending on outside temperature, the cost of electricity versus fossil fuel that might otherwise be used for heating, and the type of heat distribution system that is commonly used. However, they make the most financial sense in climates where both heating and cooling are needed. They also make the most sense when electricity prices relative to fossil fuel prices are low, because a heat pump typically runs on electricity. Though heat pumps are always more efficient than direct heating, they are only more cost-effective in homes that are well insulated, as the capital cost will not be recovered if the heat leaks out too quickly.

Where temperatures drop below 40F in winter, an air source heat pump will need to be operated with a supplementary heating system, such as a furnace. However, this may change with more energy efficient houses and newer models of heat pumps. Air source heat pumps, where the exterior unit transfer heat from the air, are the most commonly used types of heat pumps in houses, and the most feasible for an installation in an existing home, though more efficient ground-source models may become more common in the future. (See sidebar on ground source heat pumps.)

Choosing a heat pump

Heat pumps are not available on the retail market for do-it-yourselfers. Since each home requires a custom installation, a certified technician should help to determine the best system for the home, and should be hired to install the heat pump.[2] The capacity of the heat pump you choose will depend on the specifics of the house, climate, and existing heating system. Components such as the thermostat and ducts will also affect the pump's efficiency. Your home thermostat needs to control both the heat pump and supplementary heating system, so it may need to be replaced with the installation.

Ground Source Heat Pumps

Ground source heat pumps, also known as geothermal or ground-coupled heat pumps, are a more efficient alternative to air source heat pumps and other home heating systems. These may become more easily available for homes in the near future, however they are much more suited to new construction than to installation in an existing home. These systems transfer heat from the ground in winter, and to the ground in summer. The higher efficiency is achieved in winter, because ground temperatures are more constant and tend to be warmer than air temperatures. Currently, ground source heat pumps are more widely used in areas with very cold winter climates. Installations require more exterior space and a greater degree of customization than for air source systems.

Ground source systems have a number of advantages over air source systems. They are generally less expensive to operate. They reduce the need for auxiliary heat because more heat is available in the ground than in the air. They also last longer: there is less wear on the compressor because ground temperature has significantly less variation than air temperature. In addition, there is no need to defrost outdoor coils as there is with air source systems.

Ground source systems have significant disadvantages, which make them most feasible in new construction. The installation cost is higher than for air source systems. A unique design is needed for each site. It requires a geothermal assessment and must take into account the moisture, soil temperatures and heat conductivity at the site. The design must ensure that the soil near it does not freeze when heat is extracted. Systems may require extensive digging or drilling for placement of the exterior coils. For a home system, these costs may offset the savings in operating cost during the system's usable life. In most areas, there are also fewer installers capable of doing the work. Finally, some jurisdictions require special permits.

Ground source heat pumps may make more sense in commercial and institutional buildings, where heating and cooling needs are large enough to make the initial investment worthwhile, and where engineering consultants are more likely to already be involved in the design of building mechanical systems. However, these systems offer a great deal of promise for energy efficient homes and may gain market footing in the future. Buyers should beware of situations where exterior coils are installed under a building's concrete floor, making repair very expensive.

Water source heat pumps can be used where a well or body of water is close to a building. However, in addition to the disadvantages of ground source heat pumps, these systems may be subject to additional local environmental regulations. Altering water temperature is a way of altering water quality, affecting the aquatic habitat. In some systems, heat could be transferred into or removed from water that is put in a separate location.

Sizing a heat pump is important. A system that has too much capacity will turn on and off more, functioning less efficiently and wearing down more quickly than one the right size. A system that is too small may require more supplemental heat, increasing your utility bills. Some climates have a greater need for heating in winter than for cooling in summer. In these cases the best choice may be a smaller unit, so summer cooling operates efficiently, along with added insulation to increase winter efficiency.

Because each installation is different, the industry does not generally make component prices available. Installation of a system in an existing home, including parts, will cost anywhere from $3500 to $8000, with the high end of the range representing the most efficient systems. This is substantially more than the cost of replacing an existing furnace (generally under $3000 for systems that have a longer life-span than a heat pump). Of course, the operating cost of the heat pump will be lower due to the higher efficiency. Cost savings cannot be estimated accurately without knowing the specifics of the climate and house. Operating savings for heating and cooling must be calculated separately.

Homebuyers should beware that new homes equipped with heat pumps often have relatively low efficiency systems. Additionally, in very cold climates, the exterior unit should have a mechanism to defrost the coils periodically.

Heat pumps include a refrigerant, such as Freon (R-22) or the more environmentally sound Puron (R-410A). Recharging and replacement of the refrigerant may be needed during the life of the heat pump, depending on wear and proper installation. Each heat pump is made for use with a specific refrigerant, so you should not buy an older model expecting to be able to run it with a less environmentally damaging refrigerant when the old refrigerant needs replacing.

Available models

Table 1 shows a small sample of units that are available. Each model is available in a number of capacities. To make comparisons fair, only three ton capacity models are shown; this is a typical capacity for an 1800 square foot, energy-efficient, 2-story house in the Seattle area.[3] Capacity is generally measured in tons, a holdover from when refrigeration was accomplished with home ice boxes. One ton of capacity is equal to the refrigerating power of one ton of ice melting over the course of 24 hours. This is equal to about 13 MJ/hr,[4] so a three ton capacity unit can move at the maximum 3 x 13 = 29 MJ of heat in each hour.

Make and Model




avg. COP


avg. COP


Bryant 698B NX 036000





Bryant 661C NX036000





Carrier 38YSA





Carrier 38YKC





Carrier 38YDB





Trane XL1800





Trane XR 12





Table 1 - Sample of Available Split System Heat Pumps.

The heat pumps in the table are all split system, air source heat pumps, meaning that they pump heat both to and from outdoor air, offering cooling in the summer as well as heating in the winter.

Home Heating in other Countries

Central heating with a duct system for air distribution is the most common type of home heating in the U.S. Forced air heating systems like these work well with heat pumps, because the air only needs to be heated to a relatively low temperature. Heat pumps are most common in the U.S. and Japan because forced air systems dominate in both countries. U.S. systems generally heat an entire house, while Japanese systems generally heat individual rooms.

In Europe, in contrast, radiant heat is more common. Hot water is passed through a radiator, which can be a baseboard unit or the type of unit common in older apartment buildings in the U.S. This requires high water temperatures, about 160 F, for which a heat pump is usually not efficient.

Heated water can also be passed through tubing in floors or walls, providing more surface area and therefore enabling heating with water at a lower temperature. Low temperature systems are becoming more common, and heat pumps will make more sense with these systems. Additionally, with smaller rooms found in new homes in many urban areas, the trend is toward radiant heat systems that reduce energy requirements. The future may be in combining a ground source heat pump with low-temperature, high surface area, radiant heat.

For each model we report the summer and winter average coefficients of performance "COP." These are based on ratings provided by the manufacturer[5] and should be regarded as the best expected performance. The COP is the ratio of energy embodied in the heat moved, to the energy in the electricity used to run the heat pump. So any COP greater than 1.0 means that the heat pump moves more heat than the same amount of electricity could produce in direct generation. So you can see from the table that most of these heat pumps move between two and three times the heat that could be generated directly with the electricity!

Summer COPs are much higher than winter COPs. In other words, typical split-system installations move more heat in their cooling mode than in their heating mode, for the same amount of electricity. This is because in the summer the heat pump might be moving heat from a typical indoor environment of 80F to an outdoor environment of say 95F, or a difference of 15F. In the winter, the unit might be moving heat from an outdoor environment of say 35F to an indoor environment of 70F, or a difference of 35F. In most United States climates the outdoor-to-indoor temperature differential is greater in the winter than in the summer, and it is more difficult for the heat pump to move the heat across it (imagining pushing a ball up a bigger hill). Hence the heat pump is less efficient in the winter.

This table only represents a small sample of products available. Air source heat pump manufacturers include Bryant, Trane, Carrier, Rheem, Lennox and York, among others. Each manufacturer makes high, medium, and low efficiency models at a variety of capacities. Efficiency varies with external temperature. Maximum, rather than average, operating efficiencies are shown.

Homeowners considering an installation should be aware that some models make substantial noise, but most manufacturers have engineered less noisy models. The particulars of the installation can also make a difference.

[1] International Energy Agency, Heat Pump Centre Newsletter, Volume 15, No. 3, 1997

[2] Installers and technicians who work with or purchase refrigerants must be certified by an organization that is approved by the U.S. Environmental Protection Agency. Therefore, heat pump installers should be certified by one or several of the following: heat pump manufacturers, the Refrigeration Service Engineers Society (RSES); the Air Conditioning Contractors of America (ACCA); the Mechanical Service Contractors of America; local chapters of the National Association of Plumbing-Heating-Cooling Contractors; and the United Association of Plumbers and Pipefitters. There is also a voluntary national certification program for heat pump installers run by the North American Technical Excellence (NATE) Inc. In addition, the International Ground Source Heat Pump Association (IGSHPA) provides voluntary accreditation to ground source heat pump installers.

[3] 1800 square feet would today be considered a compact house for a family and would likely have three or four bedrooms. For perspective, older houses in urban neighborhoods are often 1,000 square feet or less, and newer suburban homes may be 4,000 square feet or more.

[4] ILEA reports most energy values in megajoules (MJ). A megajoule is enough energy to bring about 3 quarts of room-temperature water to boiling, or to run a 1500 watt hair driver for 11 minutes.

[5] The COPs shown in the table are derived from the industry-standard measures heating seasonal performance factor (HSPF) and seasonal energy efficiency ratio (SEER).
HSPF is the total heat output indoors during the heating season, in British thermal units (Btu), divided by the total energy consumed during that time, in watt-hours (Wh). It includes energy for supplemental heating. Average weather data are used in representing the heating season. SEER is a similar measurement of cooling efficiency over the entire cooling season: it is the total heat removed from the indoors during the cooling season in Btu, divided by the total energy consumed during that time, in Wh.