What a heat pump does
A heat pump moves heat from one place to another instead of generating heat by burning fuel or running a resistance heater. In winter, it pulls heat from the outside air (even cold air contains some heat) and moves it indoors. In summer, it reverses direction and pulls heat out of your home and releases it outside, cooling your rooms. This is why a heat pump can both heat and cool—it is the same machine running in opposite directions.
The core job is heat transfer, not heat creation. A heat pump uses a refrigerant (a liquid that evaporates and condenses easily) and a compressor to move thermal energy. The outdoor unit absorbs heat, the compressor pressurizes the refrigerant to make it hotter, and the indoor unit releases that heat into your home. When cooling, the cycle reverses: the indoor unit absorbs heat, and the outdoor unit releases it.
Key Takeaways
- A heat pump moves existing heat from outside to inside in winter and from inside to outside in summer, rather than creating heat by burning fuel.
- The system uses a refrigerant and compressor to transfer heat efficiently, which is why it can both heat and cool with one unit.
- Heat pumps work even in cold climates, though their heating output drops as outdoor temperature falls below freezing.
- Operating costs are typically lower than furnaces or electric resistance heating because moving heat uses less energy than generating it.
- A heat pump requires both an indoor unit (usually wall-mounted or in a closet) and an outdoor unit to complete the heat transfer cycle.
How the heating cycle works
During winter heating, the outdoor unit contains an evaporator coil that absorbs heat from the outside air. Even at 20°F or 30°F, air contains thermal energy that the refrigerant can capture. The refrigerant evaporates (turns to gas) as it absorbs this heat, then flows to the compressor inside your home or in the outdoor unit.
The compressor squeezes the refrigerant gas, raising its temperature and pressure. This hot, pressurized gas then flows to the indoor unit's condenser coil, where it releases heat into your home's air or water. As the refrigerant cools and condenses back into liquid, it returns to the outdoor unit to repeat the cycle. Your furnace fan or air handler circulates heated air through your ducts and into your rooms.
This process continues as long as the outdoor temperature is above the heat pump's minimum operating point—usually around −15°F to −25°F depending on the model. Below that temperature, most heat pumps switch to a backup electric resistance heater to maintain comfort.
How the cooling cycle works
In summer, the heat pump reverses. The indoor unit's evaporator coil now absorbs heat from your home's air, cooling it down. The refrigerant evaporates as it pulls this heat indoors, then travels to the outdoor unit's condenser coil. There, the compressor pressurizes the gas, and the outdoor coil releases the heat to the outside air.
The cooled, condensed refrigerant returns indoors to repeat the cycle. Your air handler blows the cooled air through your ducts and into your rooms. Because the heat pump is moving heat out rather than generating cold, it uses significantly less energy than a traditional air conditioner.
Why heat pumps are more efficient than furnaces
A furnace burns natural gas or oil to create heat, which means it must generate all the thermal energy it delivers. A heat pump moves heat that already exists, which requires far less energy. Moving heat is thermodynamically cheaper than making it.
A furnace's efficiency is measured as a percentage of fuel burned that becomes usable heat—typically 80% to 95% for modern units. A heat pump's efficiency is measured as a ratio called COP (coefficient of performance), which can be 3 to 4 or higher. A COP of 3 means the heat pump delivers three units of heat for every one unit of electricity it uses. In winter, this translates to lower monthly bills, especially if your local electricity rates are competitive with gas prices.
The trade-off is that heat pump heating output declines as outdoor temperature drops. On very cold days, the system works harder and pulls more electricity. Some homes use a hybrid system that runs the heat pump until outdoor temperature falls to a set point (often 35°F to 45°F), then switches to a gas furnace for the coldest hours.
Indoor and outdoor components
A heat pump system has two main parts. The outdoor unit houses the compressor, condenser coil, and a fan. It is roughly the size of a central air conditioner unit and sits on a pad next to your home. The indoor unit is usually a wall-mounted ductless head (for a mini-split system) or an air handler in a closet or basement (for a ducted system).
In a ducted system, the indoor air handler connects to your existing ductwork, so heated or cooled air reaches every room through the same vents as a traditional furnace. In a ductless mini-split system, one or more wall-mounted heads deliver air directly to individual rooms or zones, and refrigerant lines run through small holes in the wall to the outdoor unit.
Both the indoor and outdoor units must be sized correctly for your home's square footage and climate. An undersized unit will run constantly and struggle to reach your set temperature. An oversized unit will cycle on and off too frequently, wasting energy and wearing out components faster.
Performance in cold climates
Heat pumps work in cold climates, but their heating capacity shrinks as temperature drops. At 47°F, a typical air-source heat pump delivers its rated capacity. At 32°F, output may drop to 70% of rated capacity. At 0°F, it may be 50% or less. This is why cold-climate heat pumps are designed with higher capacity ratings and why many homes in northern regions pair a heat pump with a backup furnace.
Newer cold-climate heat pumps, including some cold-climate-specific models, maintain better performance at low temperatures through improved compressor design and larger coils. Some can heat efficiently down to −13°F or lower. However, even the best air-source heat pump will eventually need backup heat on the coldest days of the year.
Ground-source (geothermal) heat pumps extract heat from the earth rather than the air, and ground temperature stays around 50°F year-round even in cold climates. This means geothermal systems maintain high efficiency in winter, but they cost significantly more to install because they require digging or drilling.
Maintenance and lifespan
A heat pump requires less maintenance than a furnace because there is no combustion, no flue, and no annual safety inspection. The main tasks are cleaning or replacing the air filter every 1 to 3 months, keeping the outdoor unit clear of leaves and snow, and having a technician check refrigerant levels and electrical connections every 1 to 2 years.
The compressor is the most expensive component to replace, costing $1,500 to $3,000 or more. Most heat pump compressors last 10 to 15 years with proper maintenance. The entire system typically lasts 15 to 20 years. Regular filter changes and keeping the outdoor coil clean extend the lifespan and maintain efficiency.
Frequently Asked Questions
Can a heat pump work in freezing weather?
Yes, but with reduced heating output. Most air-source heat pumps continue heating down to about −15°F to −25°F, though they work harder and use more electricity. Below that temperature, a backup electric resistance heater or furnace usually takes over. Ground-source heat pumps work efficiently even in extreme cold because they draw heat from the earth.
Does a heat pump use a lot of electricity?
Heat pumps use less total energy than furnaces or resistance heaters because they move heat rather than generate it. However, they do run on electricity, so your electric bill will increase. Whether your overall heating cost is lower depends on your local electricity and gas prices. In areas where electricity is cheap, heat pumps are usually cheaper to operate than gas furnaces.
What is the difference between a ducted and ductless heat pump?
A ducted heat pump (also called a central system) connects to your existing ductwork and heats or cools your whole home through one indoor unit. A ductless mini-split has one or more wall-mounted heads in individual rooms and does not require ducts. Ductless systems are easier to install in homes without ducts and allow zone control, but ducted systems are less visible and can heat or cool the entire home from one unit.
How much does it cost to run a heat pump?
Operating cost depends on your local electricity rate, outdoor temperature, and how often you heat or cool. In moderate climates, a heat pump typically costs 30% to 50% less to operate than a gas furnace. In very cold climates where the backup heater runs frequently, savings are smaller. Ask your utility company for average heating costs in your area, or request a comparison estimate from an HVAC contractor.
Can I replace my furnace with a heat pump?
Yes. If you have ductwork, a ducted heat pump can use the same ducts as your old furnace. If you do not have ducts, a ductless mini-split system can be installed without major renovation. A technician can assess your home's insulation, ductwork condition, and climate to recommend the right system size and type for your situation.