Heat Pumps: What are they and how do they work?

Dear Sam,

I keep hearing about these things called heat pumps. What are they, and how do they work?




Dear Heather,

Thanks for the question! When talking about heating and cooling homes, there are two kinds of heat pumps: air source heat pumps (ASHP) and geothermal heat pumps. Since geothermal heat pumps are still costly to install, we will limit our discussion here to air source heat pumps (ASHP).    

Simply put, a heat pump moves heat from one place to another, for example, from outdoors to indoors, or vice versa. Because it moves heat from one place to another rather than generating it, a heat pump uses less energy than a conventional gas or electric system. Heat pumps are often so energy efficient that they receive high Energy Star ratings and can save you significant money in operating costs compared to other electric heating and cooling systems. In the summer, a heat pump acts like an air conditioner, removing the hot air from your home. In the cooler months, a heat pump pulls heat from the cold outdoor air and transfers it indoors, warming your home. 

You may have heard more about heat pumps recently because they run on electricity and thus do not need any fossil fuels to operate. And they are very efficient users of electricity at that. Therefore, heat pumps are discussed as an important feature in transitioning residential and other types of buildings to a more environmentally friendly and carbon-free future.   

One major misconception about heat pumps is that they are inappropriate for Minnesota’s cold winters. While that may have been true 20+ years ago, there have been many advancements in heat pump technology in the last decade, and now there are many heat pumps operational down to 10 degrees Fahrenheit and even colder. Keep in mind, though, that the colder the air outside is, the harder it is to pull out heat from the air. When it is below freezing, it is likely that the heat pump will need to use more energy to extract the heat from the air and, therefore, will be more expensive to operate. So, while you may not be able to use a heat pump efficiently and inexpensively for the entire Minnesota winter, the majority of the year, it is still a highly efficient heating and cooling system that does not rely on fossil fuels to operate. In fact, the Center for Energy and Environment (CEE) recommends heat pumps for cold climates. CEE expects heat pumps will provide 25% of Minnesota’s total residential electric energy savings over the next decade. For more information on heat pumps in cold climates, check out all the work and research the Center for Energy and Environment has done. 

If you are considering installing a heat pump in your home (and we hope you are!), start by getting an energy audit through CEE to ensure your house is adequately insulated to get the best performance from a heat pump (and save you money on heating and cooling your home no matter what type of system you use). Then, research and get estimates from experienced contractors. If you already have central air, you can most likely replace your a/c unit with a heat pump and utilize your existing ductwork. If you don’t have existing ductwork, mini-splits and ductless units are available, too. Finally, be sure to do your research on tax credits and rebates. The Inflation Reduction Act has a federal tax credit of 30% of the heat pump’s total cost, including the installation labor cost, up to $2000, but only if the heat pump meets the Consortium for Energy Efficiency’s highest tier for efficiency. You may be eligible for a rebate from Xcel Energy, too. An experienced contractor can help identify any rebates and tax credits available while helping you select the right heat pump system for your space.