Heat pumps alter the temperature of the air for indoor environments. A reversible heat pump can provide either warm or cold air to an environment. Heat pumps have a shorter amortization time scale than traditional air conditioning systems, making them a more economical choice.
A heat pump with an inversion valve is simple to switch back and forth between heating and cooling. In a traditional layout, the interior space is serviced by a furnace for heat and an evaporator/condenser combination unit for air conditioning. Using one unit for both functions saves money up front as well as over the life of the unit, thanks to the quicker depreciation time frame.
A heat pump does not make an economical system if heating is the only desired application. Water and condensation boilers offer significantly higher degrees of efficiency. Heat pumps can use water, air or the ground as a cold source, from which the pump recovers heat. The refrigerant takes heat out of the cold source by the evaporator. If the ground is the cold source, the heat pump is part of a geothermal system. If air is the source, it comes from the air outside the building. Water is drawn from the water table or nearby lakes or rivers.