What Is a Heat Pump?

A heat pump does not create most of its heat by burning fuel. Instead, it uses electricity and a refrigeration cycle to transfer thermal energy from one place to another.

During winter, an air-source heat pump can extract heat from outdoor air even when the temperature is below freezing. Ground-source systems collect heat from the ground, while suitable water-source systems can use a body of water as their heat source.

Many heat pumps can reverse their operating cycle to provide cooling during warmer weather. Air-to-water systems can also supply heated water to radiators, underfloor heating and a suitably designed hot-water cylinder.

How Does a Heat Pump Work?

A refrigerant circulates through a sealed circuit. It absorbs heat at a low temperature, passes through a compressor and releases that heat at a higher temperature where it can be used by the home.

This process allows a heat pump to deliver more heat energy than the electrical energy used by the compressor and other components. Actual efficiency varies substantially with outdoor temperature, flow temperature, system design, installation quality and operating conditions.

For a deeper look at how compressors, refrigerants, smart controls and cold-climate designs are developing, see our Heat Pump Technology 2026 guide.

Why Heat Pumps Are Becoming More Popular

The growing interest in heat pumps is being driven by electrification, improved equipment and the expansion of renewable electricity. For a suitable property, potential advantages include:

• efficient space heating;
• heating without on-site fuel combustion;
• cooling from compatible systems;
• integration with solar electricity;
• compatibility with smart energy controls;
• the potential to use off-peak electricity tariffs; and
• reduced dependence on oil or gas.

However, heat pumps are not automatically cheap to run. Electricity prices, climate, insulation, required water temperature and the heating system being replaced all influence operating costs.

Main Types of Heat Pump Systems

Air Source Heat Pumps

Air-source heat pumps extract heat from the outside air. They are widely used because they do not require ground loops or boreholes and can be suitable for many existing properties.

Potential advantages include:

• simpler installation than ground-source systems;
• lower upfront cost in many installations;
• no requirement for a large ground collector;
• heating and, with suitable systems, cooling;
• good efficiency when correctly designed; and
• a wide choice of equipment.

The outdoor unit requires sufficient airflow and suitable positioning. Performance also changes with outdoor temperature, making correct sizing particularly important in colder climates.

Ground Source Heat Pumps

Ground-source heat pumps collect thermal energy through buried pipework. Horizontal loops require suitable land, while vertical systems use boreholes where space or site design makes them more appropriate.

Potential advantages include:

• relatively stable source temperatures;
• consistent seasonal performance;
• no outdoor fan unit extracting heat from ambient air;
• long-lived ground-loop infrastructure when correctly installed; and
• good performance in cold climates.

The trade-off is installation complexity. Excavation, drilling, site surveys and ground-loop design can make the initial project considerably more expensive than a typical air-source installation.

Water Source Heat Pumps

Where an appropriate lake, river, well or other water source is available, a water-source heat pump may be possible. Site conditions, permissions, environmental requirements and system design determine whether this is practical.

These installations are much more site-specific than ordinary air-source systems, so professional assessment is essential.

Air Source vs Ground Source vs Water Source Heat Pumps

For many existing homes, an air-source system is the most accessible starting point. Properties with sufficient land or suitable geology may justify investigating ground source, particularly when the homeowner expects to remain in the property for many years.

The best heat pump system should therefore be selected on whole-life suitability rather than equipment price alone.

Why Heat Pumps Work Well With Solar Panels

Because heat pumps run on electricity, solar PV can supply part of their electrical demand whenever the panels are generating and the heat pump is operating.

The amount of heat-pump electricity supplied directly by solar depends on the season, weather, solar-array size and household heating schedule. Winter heating demand often occurs when solar generation is lower, so solar should not be assumed to cover the entire heating requirement.

Even so, coordinating solar generation, heating schedules and other household loads can increase the amount of locally generated electricity used inside the home.

Learn more in our guide to Home Solar Systems.

Adding Home Battery Storage

A home battery can store surplus solar electricity for later use. That stored electricity may then contribute to evening household demand, including heat-pump operation.

A battery does not automatically make a heat pump cheaper to run. The economics depend on battery size, solar generation, electricity tariffs, household demand and how frequently the available battery capacity is used.

Smart controls may also allow some households to charge a battery during cheaper tariff periods and use that electricity later when grid prices are higher.

Learn more in our Home Battery Storage Systems guide.

Heat Pumps and Thermal Energy Storage

Instead of storing electricity, a home can sometimes store thermal energy. A hot-water cylinder, buffer tank or other thermal storage technology can allow heat to be produced at one time and used later.

This can be particularly useful when a heat pump is paired with time-of-use electricity tariffs or renewable generation. The system may be able to produce some heat during favourable periods rather than responding only when heat is immediately required.

The benefit depends on system design, storage losses, tariff structure and the amount of useful heat that can be shifted between time periods.

Choosing the Best Heat Pump System for Your Home

Choosing the best heat pump system starts with understanding the property. Floor area alone is not enough to determine the required capacity.

A proper heat-loss assessment should consider insulation, glazing, airtightness, exposed surfaces, local design temperature and the temperature required by the home’s heating emitters.

Heat Pump Installation Considerations

Installation quality has a major influence on comfort and efficiency. A high-quality heat pump can perform poorly if it is incorrectly sized, badly commissioned or connected to an unsuitable heating system.

Air-source outdoor units require adequate airflow and sensible positioning. Air-to-water systems must also be designed around the radiators, underfloor heating, pipework, controls and hot-water requirements of the property.

Ground-source systems add another layer of design because the ground collector or borehole must be matched to the building’s heating requirement and local ground conditions.

Heat Pump Running Costs and Energy Savings

Heat pumps can be highly efficient, but efficiency and running cost are not the same thing. What matters financially is how much electricity the system consumes and what that electricity costs compared with the heating system being replaced.

Important factors include:

• annual heat demand;
• seasonal heat-pump efficiency;
• local electricity tariffs;
• the cost and efficiency of the previous heating system;
• required flow temperature;
• climate;
• solar generation and battery use; and
• household temperature settings.

A well-designed system in an efficient home may perform very differently from the same model installed in a property with high heat loss and undersized radiators.

Maintaining Your Heat Pump

Heat pumps require routine care to maintain airflow and identify developing faults. Homeowner maintenance is generally straightforward, but it should be combined with professional servicing according to the manufacturer’s requirements.

• Check and clean filters where applicable.
• Keep outdoor units clear of leaves and debris.
• Maintain unobstructed airflow.
• Watch for persistent ice or unusual noises.
• Monitor unexplained changes in electricity consumption.
• Arrange professional servicing when required.

We have a dedicated step-by-step guide covering this subject. Read How Do I Maintain My Heat Pump? 2026 Guide.

Government Grants and Heat Pump Incentives

Heat-pump grants, rebates and tax incentives vary considerably between countries and can change over time. Eligibility may also depend on the property, installer accreditation, equipment specifications or improvements made before installation.

Before making a purchasing decision, check the current official energy or government programme for your location rather than relying on an older grant figure quoted online.

Where assistance is available, compare the final installed cost after incentives rather than choosing a system purely because it qualifies for the largest headline grant.

Common Mistakes When Buying a Heat Pump

A heat pump is a complete heating-system decision rather than simply another appliance. Avoid these common mistakes:

• choosing equipment before completing a heat-loss assessment;
• assuming a larger unit will perform better;
• ignoring radiator or underfloor-heating requirements;
• comparing only the purchase price;
• overlooking outdoor-unit positioning and airflow;
• assuming advertised efficiency will equal real-world seasonal efficiency;
• ignoring maintenance and warranty requirements;
• expecting solar panels to supply all winter heating demand; and
• failing to compare several properly specified installation proposals.

The goal should be a system designed around the property rather than forcing the property to work around a pre-selected heat pump.

The Future of Heat Pump Technology

Heat-pump technology continues to develop. Variable-speed compressors, improved cold-weather operation, lower-global-warming-potential refrigerants, smarter controls and better integration with home-energy systems are all influencing newer equipment.

Heat pumps are also becoming increasingly connected with solar PV, batteries, thermal storage and time-of-use electricity tariffs. That allows the heating system to respond not only to temperature but also to when electricity is available and what it costs.

We’ve covered these developments in much greater depth in our Heat Pump Technology 2026: Latest Advances & What’s Coming Next guide.

Best Heat Pump Systems: Frequently Asked Questions

Final Thoughts

The best heat pump systems are not necessarily the largest, most expensive or highest-specification models. The best system is one that has been correctly matched to the property’s heat loss, climate, heating distribution and household requirements.

For many homes, an air-source heat pump provides the most practical balance between installation complexity and efficiency. Ground-source systems deserve consideration where the site and budget make the additional ground works worthwhile, while water-source installations can work well in suitable locations.

Whatever technology you choose, good design and installation remain crucial. Combine those with sensible controls and regular maintenance and a heat pump can become an important part of an efficient home-energy system.