Heat pumps work by transferring heat energy between two areas. The most common type, the air-source heat pump, uses a coil of refrigerant to absorb heat from indoor air and transfer it to the air outside for cooling. In cold weather, the heat pump reverses the direction of heat transfer.
Heat pumps are an efficient source of heating and cooling in climates with mild winters as it takes less energy to move heat between two areas than it does to generate heat. They can lower utility bills by up to 40 percent. They also eliminate the need to install separate heating and cooling systems to keep a building comfortable.
The major drawback of air-source heat pumps is that they may be unable to extract enough heat from cold air to keep a building comfortably warm. Heat pumps usually have a backup electrical heater to generate heat in weather below 35 degrees, but this mechanism is less efficient than the heat pump's primary mode. Geothermal and water-source heat pumps, which work by transferring heat between the ground or a nearby water source and indoor air, are more efficient in cold weather and may need less maintenance but are more expensive to buy, install and repair.