Here's how ultra-efficient heat pumps compare to traditional HVAC systems — you could save $1,000 by upgrading

Most homes rely on the same outdated heating and cooling systems they've used for decades: burning gas in winter and cranking up inefficient air conditioning in summer. Enter heat pumps — a smart, energy-efficient solution that provides both heating and cooling in one system.

Unlike traditional furnaces, which only warm, or air conditioners, which only cool, heat pumps work year-round by transferring heat rather than generating it.

In summer, a heat pump pulls heat from inside your home and pushes it outside, keeping things cool. In cooler seasons, it does the opposite, drawing warmth from the air (even in low temperatures) and bringing it indoors. 

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"Over time, these heat pumps have become better and better at capturing that available heat energy," Jeff Goss, director of residential product management for Rheem, told CNET. 

This dual functionality makes them not only versatile but significantly more energy-efficient than conventional heating and cooling systems. 

"On a heat pump, you can actually achieve what we call a coefficient of performance that is greater than the heat energy that's inserted or the energy that's inserted," Goss said.

This basically means they provide more than twice as much heat as the energy they consume, since they are moving heat (or cool air when in cooling mode) from the air surrounding the outdoor unit into the indoor unit rather than relying on electric resistance or flame combustion to generate heat. Even though it may be cold outside, absolute zero is actually minus-459.67 degrees Fahrenheit, so anything warmer than that actually has heat that can be moved and concentrated.

Of course, heat pumps aren't going to be much help at several hundred degrees below zero, but modern ones are often rated to work well even when it's minus-15 degrees Fahrenheit outside.  

Because heat pumps use far less energy than traditional heating systems, they can significantly lower electricity bills — especially for homes relying on propane, oil, or electric resistance heating. According to Consumer Reports, installation averages $8,348 (compared to $6,221 for a gas furnace), but they're often the most cost-effective option long-term. In many areas, switching could mean over $1,000 in annual savings.

Homeowners can also take advantage of financial incentives, including tax credits and rebates through the Inflation Reduction Act, to help make upfront costs more manageable.

It is important to note that shortly after taking office, President Donald Trump signed an executive order to halt funding for clean energy programs under the IRA and Infrastructure Investment and Jobs Act. This raised concerns that tax credits for renewable energy projects might be affected. However, the White House later clarified that tax credits aren't affected, as changing them requires an act of Congress. Still, legal challenges to Trump's orders could cause delays for federal agencies including the IRS.

Beyond saving money, heat pumps contribute to community resilience by reducing reliance on dirty energy sources such as oil and natural gas as well as decreasing pollution output. Cities and states are increasingly supporting heat pump adoption as a climate-friendly alternative to traditional heating and cooling systems. For instance, net-zero homes featuring heat pumps are becoming more common, offering homeowners a way to cut energy costs while preparing for extreme weather events.

For those considering a switch, companies such as EnergySage offer free resources to help homeowners find the best systems for their needs and vetted contractors to install them. Exploring your options now could lead to long-term savings and a more energy-efficient home.

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