A heat pump is essentially an air conditioner that can provide both heating and cooling.

Heat pumps are generally highly efficient. The only real downfall to this type of system is that because there are coils on the outside, they collect ice. That means that the pump must melt this ice from time to time, switching it to being an air conditioner so the coils heat up. Additionally, to ensure cold air is not sent into the home, the heat pump will light an electric strip or burners, thus heating the cold air produced by the air conditioner. Then, as the ice finally melts, the switch goes back to the heating side, turning the electrical strip or burners off.

For the air conditioner, what happens is that refrigerant is passed through the coil on the inside. This substance is then evaporated from liquid form to vapor. When this happens, it then absorbs heat and the air located around the coil is cooled. Then, the vapor, which is not laden with heat, goes through a compressor. As this occurs, the vapor is compressed, which causes the temperature to rise along with pressure. Now, the reversing valve sends the flow of hot, high-pressured vapor to the coil on the outside at which time the heat is released and fanned back into the outdoor air.

You could think of a heat pump as a conventional type air conditioner with the benefit of producing heat when the weather turns cold. Although this system sounds a little archaic, it actually saves anywhere from 40% to 60% energy when compared to a traditional, electric furnace!