- Heat pumps transfer heat from air, ground, or water to heat homes efficiently by moving heat rather than generating it.
- Air source heat pumps extract heat from outside air but are less efficient in very cold weather.
- Ground source and water source heat pumps use constant ground or water temperatures for more stable efficiency but require more space or complex installations.
How do heat pumps work? A detailed look at the three main variations

Heat pumps are an increasingly popular choice for home heating. They transfer heat from the outside environment—air, ground, or water—into your home, even during cold weather. The process is efficient and eco-friendly, using electricity to move heat rather than generating it directly. All heat pumps follow the same basic cycle: evaporation, compression, condensation, and expansion.
First, the heat pump absorbs heat from the outside. The heat is captured by a refrigerant in a heat exchanger. As the refrigerant absorbs heat, it evaporates and turns into a low-pressure gas. This gas is then sent to a compressor, which increases its pressure and temperature. The hot gas moves to another heat exchanger, where it transfers heat to water, which is used to heat your home. After this, the gas cools and returns to a liquid state. Finally, the liquid passes through an expansion valve, lowering its pressure, and preparing it to absorb more heat. The cycle then repeats.
That’s the basic overview, but how do the three main types differ?
Air Source Heat Pumps
Air source heat pumps extract heat from the outside air, even when temperatures are low. These are the most common heat pumps you’re likely to see. They transfer this heat to water, which then circulates through radiators or underfloor heating. These pumps are relatively easy to install and work in most climates, though their efficiency drops in very cold temperatures.

Ground Source Heat Pumps
Ground source heat pumps collect heat from the ground by circulating a water-antifreeze mixture through underground pipes. These pipes are either laid horizontally in a large area or drilled vertically in deep boreholes. The heat from the ground is constant, making ground source pumps highly efficient year-round, though they require significant land or drilling space.
Water Source Heat Pumps

Water source heat pumps use lakes, rivers, or ponds as a heat source. They come in two designs: closed loop and open loop. In closed loop systems, pipes filled with antifreeze are submerged in water, absorbing its heat before returning to the heat pump.
Open loop systems, however, pump water directly from a water source, extract heat, and return the cooled water. Open loop systems are generally more efficient than closed loop but come with higher installation and maintenance costs due to the large volumes of water they move.
Choosing the right type depends on your home’s location and available resources, but all offer an efficient, green solution to home heating. Find out which may be best for you, here.