What is a Heat Pump?
A heat pump is a machine or device that moves heat from one location (the ‘source’) to another location (the ‘sink’ or ‘heat sink’) using mechanical work.
Most heat pump technology moves heat from a low temperature heat source to a higher temperature heat sink.
Common examples are food refrigerators and freezers, air conditioners, and reversible-cycle heat pumps for providing thermal comfort.
Heat pumps can be thought of as a heat engine which is operating in reverse.
One common type of heat pump works by exploiting the physical properties of an evaporating and condensing fluid known as a refrigerant.
In heating, ventilation, and air conditioning (HVAC) applications, a heat pump normally refers to a vapor-compression refrigeration device that includes a reversing valve and optimized heat exchangers so that the direction of heat flow may be reversed.
Most commonly, heat pumps draw heat from the air or from the ground. Some air-source heat pumps do not work as well when temperatures fall below around −5°C(23°F).
Source: Wikipedia
Heat Pump Systems
For climates with moderate heating and cooling needs, heat pumps offer an energy-efficient alternative to furnaces and air conditioners.
Like your refrigerator, heat pumps use electricity to move heat from a cool space into a warm, making the cool space cooler and the warm space warmer. During the heating season, heat pumps move heat from the cool outdoors into your warm house; during the cooling season, heat pumps move heat from your cool house into the warm outdoors. Because they move heat rather than generate heat, heat pumps can provide up to 4 times the amount of energy they consume.
The most common type of heat pump is the air-source heat pump, which transfers heat between your house and the outside air. If you heat with electricity, a heat pump can trim the amount of electricity you use for heating by as much as 30%–40%. High-efficiency heat pumps also dehumidify better than standard central air conditioners, resulting in less energy usage and more cooling comfort in summer months. However, the efficiency of most air-source heat pumps as a heat source drops dramatically at low temperatures, generally making them unsuitable for cold climates, although there are systems that can overcome that problem.
For homes without ducts, air-source heat pumps are also available in a ductless version called a mini-split heat pump. In addition, a special type of air-source heat pump called a “reverse cycle chiller” generates hot and cold water rather than air, allowing it to be used with radiant floor heating systems in heating mode.
Higher efficiencies are achieved with geothermal (ground-source or water-source) heat pumps, which transfer heat between your house and the ground or a nearby water source. Although they cost more to install, geothermal heat pumps have low operating costs because they take advantage of relatively constant ground or water temperatures. However, the installation depends on the size of your lot, the subsoil and landscape. Ground-source or water-source heat pumps can be used in more extreme climatic conditions than air-source heat pumps, and customer satisfaction with the systems is very high.
A new type of heat pump for residential systems is the absorption heat pump, also called a gas-fired heat pump. Absorption heat pumps use heat as their energy source, and can be driven with a wide variety of heat sources.
Source: energysavers.gov

