Electric Heat Pumps

Heat pumps, Heating and cooling

Electric heat pumps are year-round space-conditioning systems capable of providing heating, cooling, and domestic hot water. They’re appealing because they offer heating and cooling in a single piece of equipment—which usually means a lower capital cost—and provide heat at a lower cost than electric resistance heating and, in some cases, lower than gas heating.

All standard heat pumps contain two heat-exchange coils (one cold and one hot), plus a compressor charged with refrigerant (figure 1).

Figure 1: Schematic diagram of an air-to-air heat-pump operation

A heat pump can switch from heating to cooling functions by changing the position of the reversing valve. Standard heat pumps have two heat-exchange coils and a compressor.
Diagram showing how air flows through a heat pump in both heating and cooling modes

In heating mode, the hot, evaporated refrigerant runs through a condenser that delivers heat to the surrounding air. When the refrigerant that leaves the coil condenses back into a liquid, it does so at a high pressure but a medium temperature. As the refrigerant continues to expand as it goes back into the cold evaporator, its temperature lowers. The cold refrigerant runs through the cold evaporator, absorbs heat from the surrounding air, and evaporates. A motor-driven compressor forces the refrigerant to circulate and change from liquid to gas in the cold evaporator and back to a liquid in the hot condenser.

The heat exchangers typically require a fan or pump to move air or water through them to achieve effective heat transfer from a heat source to a heat sink. A heat pump can switch from heating to cooling functions by changing the position of the reversing valve.

What are the options?

There are two broad categories of electric heat pumps—air source and ground source (also called geothermal). Air-source heat pumps (ASHPs) are the most common form found in commercial applications, so they’re the focus of this report. Dedicated water-source heat pumps are less common but use water to transfer heat instead of air. Since ground-source heat pumps also use water to transfer heat, they technically are a type of water-source heat pump.


You can use ASHPs in most commercial applications and some industrial processes, particularly those that generate waste heat. However, most air-source heat pumps don’t perform well in cold climates, because their capacity and efficiency decrease significantly at low temperatures.

There are three applications where ASHPs are best suited:

  • Where electricity is the only fuel source available. Since ASHPs can provide heat up to almost four times more efficiently than electric resistance heaters can, their operating costs will be significantly lower.
  • Where heating loads are small, and the capital cost of an ASHP is less than that of a separate air conditioner and furnace. Even if cheap heating fuel contributes to low energy costs for a furnace, where heating loads are small, low energy costs might not outweigh the lower capital cost of buying just one piece of equipment.
  • Where heating loads are large, and the difference in price between electricity and heating fuel is great enough to produce lower energy costs for the ASHP. ASHPs can be cost-effective when they have both a lower capital cost (from buying one piece of equipment instead of two) and a lower energy cost.

Geothermal heat pumps

Geothermal heat-pump systems (also sometimes called ground-source heat pumps or geoexchange systems) use the relatively constant temperature of the ground to provide a higher efficiency than a conventional ASHP. Because the ground stays much warmer than the outside air—even in the heating season—a geothermal heat pump moves energy across a lower temperature difference and can deliver heat on even the coldest days with high efficiency.

During the cooling season, an ASHP moves energy from the building to the hotter outdoor air, whereas a geothermal heat pump transfers energy to the cooler ground—moving energy across a lower temperature difference, thereby gaining efficiency. Similarly, during the heating season, an ASHP moves energy from the cold outside air and brings it inside—and when the temperature gets too cold, electric resistance heating needs to supplement the ASHP.

The main benefit of geothermal heat pumps is energy savings. The US government has installed thousands of them in its buildings and has found that they typically save 15% to 25% of total building energy use in commercial buildings compared to conventional heating and air-conditioning systems. Because the ground temperature is more stable than outside air—cooler in the summer and warmer in the winter—the compressor has to work less hard to change the refrigerant’s state from liquid to gas and vice versa.

The major elements in a geothermal heat pump are a ground loop (a buried piping system), one or more water loops (inside the building), and a distribution system to bring conditioned air where it’s needed.

Geothermal heat-pump loops operate in open- or closed-loop configurations. Closed loops are the most common and consist of underground piping loops that use liquid similar to antifreeze for transferring heat from the ground to the geothermal heat pump. Vertical ground loops are the most popular version since they are the most space efficient, though horizontal loops are also an option.

Open-loop systems are much less common because you need a source of groundwater, such as a well or a pond. After the water runs through the geothermal heat pump, it returns to the pond. There’s no pollution, only a slight dip in temperature if the system is used for heating or a slight increase in temperature if the system is used for cooling. If fish live in the water source, remember that cooling the lake further in winter can increase the ice depth and reduce the amount of fish the lake can support.

Capital costs for geothermal heat pumps are high, limiting their current market to institutional facilities that either make decisions based on life-cycle costs or don’t have short payback period requirements, such as government buildings and K–12 schools. As a general rule of thumb, geothermal heat pumps are most likely to be economical when both heating and cooling loads are high—and when those loads are relatively balanced.

AHRI defines efficiency for air-source electric units with cooling capacities larger than 65,000 Btu/hour using:

  • Energy-efficiency ratio (EER). The EER is the ratio of the rate of cooling (Btu/hour) to the power input (watts) at full-load conditions. The power input includes all inputs to compressors, fan motors, and controls.
  • Integrated energy-efficiency ratio (IEER). IEER is a measure of part-load cooling efficiency. Note that this is a new metric that began to be applied to unitary equipment on January 1, 2010, and it supersedes the previous measure, integrated part-load value (IPLV). IEER was developed to provide a more representative measure of part-load performance than IPLV—the two aren’t comparable. Also, note that, because IEER is calculated by summing the EER at different load factors, it uses the same units as EER. However, AHRI doesn’t include units in its definition of IEER.
  • Coefficient of performance (COP). COP is the ratio of the heat output in kilowatt-hours (kWh) to the energy input in kWh. Some air-source units are tested and rated at two standard air temperatures: 47° Fahrenheit (F) and 17°F.

Below 65,000 Btu/hour, both three-phase and single-phase units are available for use in commercial buildings. Since three-phase units are more robust and save more power, they’re great for commercial buildings. However, if you’re conditioning a small space, a residential single-phase unit is better suited to your needs. For either, AHRI uses the following metrics:

  • Seasonal energy-efficiency ratio (SEER). SEER is the seasonally adjusted ratio of the rate of cooling (Btu/hour) to the power input (watts). Essentially measuring how much cooling you are getting per unit of power.
  • Heating seasonal performance factor (HSPF). HSPF is the ratio of the rate of heating (Btu/hour) to the power input (watts), adjusted for seasonal outdoor temperature fluctuations and part-load effects. Essentially measuring how much heating you are getting per unit of power.

Manufacturers report data for these metrics to AHRI, which then publishes it in online directories. As part of its product certification program, AHRI audits the manufacturer information and tests a percentage of units to ensure the accuracy of the data.

Federal minimum standards

New federal standards for commercial ASHPs went into effect in 2015; standards for residential units went into effect on January 23, 2006. Note that the federal standards for commercial units don’t regulate unit efficiency at 17°F, but ASHRAE does specify minimum efficiencies at this temperature in Addendum S of its Standard 90.1-2016 Energy Standard for Buildings Except Low-Rise Residential Buildings (figure 2).

Figure 2: Efficiency guidance at lower temperatures

Though the federal standards don’t regulate heat-pump performance at 17°F, ASHRAE Standard 90.1 provides guidance for minimum efficiencies at this temperature for commercial (three-phase) equipment. For units over 135,000 Btu/hour, ASHRAE specifies a minimum COP of 2.05; there’s no upper size limit for this specification.
Table showing energy-efficiency ratios and coefficients of power for heating and cooling for different Btus per hour.

Highest available efficiency

Though manufacturers continue to offer higher-efficiency commercial units, the highest available efficiencies for units above 65,000 Btu/hour aren’t much higher than the minimums now required by the standards—these highest levels are almost the same as those available in 2006. However, the new standard that became effective January 1, 2010, eliminates several units with efficiencies as low as 9.0 SEER from the market. For units below 65,000 Btu/hour, more high-efficiency options are available—one unit even has almost twice the SEER rating than is required by the federal standards.


ASHPs are available in two different configurations:

  • Air to air. These are the most common type of heat pumps; in heating mode, they use outdoor air as a heat source, which may initially seem confusing. The heat pump uses the outdoor air as a heat source because the outdoor air is warmer than the refrigerant in the evaporator. The refrigerant then warms from this temperature difference, then absorbs energy and evaporates. With air-to-air configurations, heat comes into the building as hot air, either through ducts or through air handlers mounted in the heated space. Fans force both the outside and inside air through the heat exchangers. Most air-to-air heat pumps don’t perform well at low outdoor temperatures and must rely on an additional heat source to maintain heating capacity.
  • Air to water. This type of heat pump is usually used in larger buildings, such as offices or multifamily dwellings, where hydronic heat distribution and zonal control are necessary. When water or antifreeze pumps through the hot heat exchanger, the resulting warm air is distributed inside the building through fan coils, baseboards, or radiant-heat tubing in the floors. This type of heat pump can also heat domestic hot water, using fan-forced indoor air, outdoor air, or heated exhaust air as the heat source.

If your facility needs both simultaneous heating and cooling in different areas, with multiple spaces to be conditioned, you can establish a distributed system. You can selectively plan locations for multiple heat pumps to move heat to cold areas within your building while cooling other rooms or areas that may be too hot. A distributed system has advantages for operations and maintenance as well—a problem with a single heat pump will only affect the room it serves, not the performance of the entire system.

How to make the best choice

Choose the right type and size

When retrofitting an existing building with a heat pump, it’s best to consider the existing heat-distribution system. If it has air ducts, an air-to-air heat pump is likely to be most cost-effective; if hydronic piping is in place, an air-to-water system will likely be less expensive. New construction requires a full cost-effectiveness analysis of the HVAC system to choose the type of heat pump that best complements your other choices.

Just like an air conditioner, an undersized heat pump won’t be able to provide sufficient cooling, but if a unit is oversized (which is more common), it not only costs more but will also lead to higher costs for associated ductwork and other auxiliaries. Operating costs also increase because oversized equipment spends more time at less-efficient part-load conditions. Specifiers and designers commonly overestimate loads because they fail to take into account the reduced air-conditioning loads that result from energy-efficient lighting, and they overestimate plug loads by using inflated nameplate ratings of office equipment in the building.

It’s also critical to use diversity factors when calculating internal loads. For example, consider a school: Peak load for the classrooms occurs when the classrooms are full, peak for the auditorium happens during an assembly, and peak for a gym occurs during a basketball game with the stands full. However, peak load for the school isn’t the sum of these loads, because they don’t all occur simultaneously.

Consider high-efficiency units

Two organizations offer high-efficiency recommendations for ASHPs: the US Department of Energy’s (DOE’s) Energy Star and the Consortium for Energy Efficiency (CEE), a nonprofit that aims to accelerate the adoption of energy-efficient technologies. The Energy Star program allows manufacturers to apply Energy Star labels to equipment that meets the program specifications so that consumers can readily identify qualified products. Utilities use the CEE’s specifications to offer rebates for equipment that meets its efficiency levels. Consumers can check with their local utility about rebates for qualified equipment or use the CEE’s criteria to help guide their selection. Recommendations are available for both commercial and residential units.


Equipment that meets the Energy Star program’s Light Commercial HVAC Key Product Criteria is awarded the Energy Star label. The CEE encourages the use of high-efficiency ASHPs through its Consortium for Energy Efficiency (CEE) High Efficiency Commercial Air Conditioning and Heat Pump (HECAC) Initiative. The Appendix B 2019 Commercial Unitary Air Conditioning and Heat Pumps Specification (PDF) provides two tiers of efficiency for equipment and a third, advanced tier that acknowledges the best-performing models existing in the market.

Residential (under 65,000 Btu/hour, single phase)

Energy Star offers its Air-Source Heat Pumps and Central Air Conditioners Key Product Criteria. The CEE has published Residential High Efficiency Central Air Conditioners and Air Source Heat Pumps Specification; CEE’s Tier 1 specification matches that of the Energy Star program.

To find energy-efficient heat-pump products, use the AHRI Directory of Certified Product Performance, which includes products from all AHRI member-manufacturers. For commercial systems, search under “unitary large equipment;” for residential systems, search under “heat pumps and heat pump coils.” The CEE also maintains a directory of AHRI-certified products under 65,000 Btu/hour cooling capacity (both single- and three-phase power) in its Directory of Efficient Equipment.

Perform a cost-effectiveness calculation

Use a calculator to evaluate energy costs for ASHPs and other equipment options. For applications where electricity is the only fuel source available, use the calculators or approaches from the first two equipment comparison methods below. If heating fuel is also available, then use DOE’s heating fuel comparison calculator. For commercial equipment, or to derive a more-accurate energy savings estimate than the calculators can provide for any equipment, use the simulation tools in the fourth method.

ASHP versus a high-efficiency ASHP

There are three calculators that can help you estimate energy savings from choosing one ASHP over another. You can use the Life Cycle Cost Estimate for 20 Energy Star Qualified Air Source Heat Pump(s) spreadsheet (XLS) to estimate savings for units in US cities but only for systems under 65,000 Btu/hour cooling capacity. You must enter the SEER and HSPF for the unit you’re evaluating as well as for a baseline unit (which could be one that meets the standards) plus a few other specifications.

Energy Star currently has no plans to develop a calculator for units over 65,000 Btu/hour, but the DOE’s Federal Energy Management Program (FEMP) has an Energy Cost Calculator for Commercial Heat Pumps that can estimate lifetime energy costs for units between 65,000 and 240,000 Btu/hour. Unlike the Energy Star calculator, which has a list of default cities to choose from, you can use the FEMP calculator for any region. However, when using the FEMP tool, the user must obtain local annual heating and cooling hours of operation for the facility, in addition to the EER and COP for the units being compared.

Canada’s Energy Star program provides Savings Calculators for both residential and commercial units. You can evaluate savings for units in cities within Canada. You can evaluate units under 65,000 Btu/hour cooling capacity by selecting the “air-source heat pump” option from the drop-down menu and evaluate units over 65,000 Btu/hour by selecting the “commercial heat pump” option. You must enter the SEER and HSPF for the former and the EER and COP for the latter for the unit you’re looking at in addition to a baseline unit and other specifications.

ASHP versus an air conditioner used in conjunction with electric resistance heat

If you’re considering ASHP versus an air conditioner used in conjunction with electric resistance heat, you can use those same calculators and enter the cooling efficiency for the air-conditioning component. Instead of using the heating efficiency from a second ASHP, use an approximate efficiency for an electric resistance heater. For residential equipment, use an HSPF of 3.413 for the heating efficiency, and for commercial equipment, use a COP of 1.

ASHPs versus gas-fired equipment (residential)

To estimate the energy savings that come from choosing between a residential ASHP and a gas furnace or boiler, use the DOE’s Heating Fuel Comparison Calculator (XLS). Note that unlike the other calculators listed above, this one won’t directly produce the energy use or savings from high-efficiency options based on the climate. Rather, it will produce the net cost to generate the same amount of heat using different types of fuel and equipment, which will reveal the fuel/equipment combination that has the least energy usage for a given load. To estimate the magnitude of the energy usage or savings compared to other equipment, the user must multiply the cost per Btu from the calculator by the actual heating loads (in Btu) for an application.

ASHPs versus gas-fired equipment (commercial)

Use a simulation tool such as eQUEST (from DOE-2) or the DOE’s EnergyPlus to model different equipment options. In calculating the annual cost of operation, use heating and cooling loads, the local cost of electricity, the efficiency and capacity of the equipment, and the part-load operation of equipment, if applicable.

Pay attention to design, commissioning, and maintenance

No matter what equipment you choose, it’s also important to make sure that the overall system is designed to be efficient, that it’s commissioned to operate as planned, and that it’s properly maintained. Comprehensive testing, adjusting, and balancing of commercial units and their controls will maximize installed efficiency and comfort. For all units, conducting regular tune-ups, cleaning/adjusting the system to correct airflow and improve heat transfer, and repairing major duct leaks can yield surprising energy savings at low cost.

What’s on the horizon?

Modern heat pumps still face industry momentum hurdles, as installers slowly increase their familiarity. With the federal efficiency minimums being put into place relatively recently, heat pumps that are on the higher end of the efficiency spectrum (25 to 27 SEER and 11 to 12 HSPF) will come down in price over the next few years as policy initiatives continue to push their adoption and utilities increase their promotion.

Who are the manufacturers?



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