Authors: Shervin Bikdeli, Navid Ajam, March, 2025
1 Description and History
Heat pumps are primarily recognized as essential refrigerators and air conditioning unit components. They operate by using electric current to transfer heat from a cooler area to a warmer one. By reversing their function, heat pumps can provide both heating and cooling; they extract ambient heat from colder environments, which can be utilized for space heating and hot water. While installing heat pumps can be costly and require a significant amount of energy to operate, harnessing renewable energy sources such as solar power can facilitate zero carbon emissions and render their operation virtually limitless.1
The first functioning heat pump was built in 1856 based on the collaboration of Carnot and Kelvin, but their practical model began to develop in 1930. In the 50’s decade, heat pumps and reversible air conditioners were used in Japan and the USA, due to seasonal demand for air conditioning and space heating. The basic design remained the same for nearly a century, undergoing gradual evolution to increase efficiency and comfort level. 2
“Specific heat pumps have been the subject of several previous works, for example: Omer3 and Florides and Kalogirou4 review the many configurations of geothermal heat pump systems, while Melinder’s handbook5 covers many aspects of system design and operation. Chua6 focus on recent component-level improvements and novel system designs, and Neksa7 reviews CO2 as a promising new refrigerant. Ozgener and Hepbasli8 and Hepbasli9review the applications of solar-assisted and gas engine heat pumps, as well as heat pump water heaters.”1
The operating principle of a heat pump is essentially the reverse of a heat engine. While a traditional heat engine converts thermal energy into mechanical work, a heat pump uses mechanical work to move heat from a colder location to a warmer one, transferring energy from the outdoors into a building during the winter, for instance. In this cycle, a refrigerant fluid, such as CO₂ (among other possible substances), absorbs heat during its evaporation phase and then releases that heat when it condenses. The process is driven by the compressor, which increases the pressure of the refrigerant and, consequently, its temperature. This cycle is repeated continuously, allowing the system to maintain comfortable indoor conditions regardless of the external climate.
Recent advancements in technology have greatly improved the performance and flexibility of heat pump systems. For example, today’s compressors utilize variable-speed technology, which allows the system to adjust its output according to real-time heating or cooling needs. This not only enhances energy efficiency by minimizing the number of on-off cycles but also increases occupant comfort by creating a more consistent indoor climate. Sophisticated control systems, often linked with smart home technologies, facilitate remote monitoring and precise adjustments of operational parameters, ensuring the heat pump runs at optimal efficiency in varying environmental conditions.
Moreover, incorporating renewable energy sources with heat pump systems is revolutionizing home heating and cooling. By pairing heat pumps with solar photovoltaic panels or solar thermal collectors, homeowners can produce their own electricity or pre-heat refrigerant, thus reducing dependence on grid energy and lowering their carbon footprint. This combination is essential for meeting ambitious climate goals and lessening the environmental impact of both residential and commercial buildings.
In addition to individual systems, there is an increasing trend toward employing heat pumps in district heating networks. These large-scale setups capture waste heat from industrial processes, data centers, or sewage systems, showcasing the ability of heat pump technology to scale and serve entire communities effectively. Such networks improve energy efficiency on a municipal level while contributing to broader initiatives aimed at decarbonizing urban spaces.
In conclusion, the development of heat pump technology illustrates a continuous path of innovation, from early theoretical contributions by pioneers like Carnot and Kelvin, to practical applications in the mid-20th century, culminating in the advanced systems available today. Ongoing research into new refrigerants, enhanced control methods, and integrated renewable energy solutions positions heat pumps to play an even more significant role in the shift toward a sustainable, low-carbon future. As efficiency continues to improve and new applications emerge, these systems are likely to remain vital in the global endeavor to reduce energy use and environmental impact.
Some of the most important types of heat pumps with their characteristic features and typical uses are:
• Air-Source Heat Pumps (ASHP):10
They are the most common systems to extract heat from outside air. They work well in moderate climates and are used very much in heating as well as cooling houses.
Advantages
• Simple to install at relatively affordable costs
• Very accessible with many off-the-shelf products
• Suitable for moderate climates
Disadvantages
• The efficiency reduces in very low temperatures
• Can produce outdoor noise
• The performance can be affected by adverse climatic conditions
• Ground-Source (Geothermal) Heat Pumps:11
They are also called geothermal heat pumps. They use the relatively constant temperature of the earth as a source of heat during the winter (as a sink of heat during the summer). They are highly efficient with low operating costs, particularly in areas with varying temperatures.
Advantages
• Highly effective due to the perpetual ground temperature
• Long lifespan with silent operation
• Lower operating costs over time
disadvantages
• High initial installation cost (drilling, land requirements)
• Installation is invasion-based and locational
• Requires much land area or boreholes
• Water-Source Heat Pumps:12
They take in the heat from an external body of water—a lake, river, or well—and perform most efficiently when there is a constant water supply.
Advantages
• High efficiency if a suitable water body is present
• Stable source temperature can produce consistent performance
disdvantages
• Requires a dependable supply of water (lake, river, or well)
• Can have regulatory and ecological issues
• Installation complexity may be higher in cities
• Absorption Heat Pumps: 13
In contrast to the use of electricity to power a compressor, the absorption systems use heat (obtained from natural gas, solar energy, or waste heat) to transfer the refrigerant. They are most typically used in industrial processes and can be paired with renewable sources of heat.
Advantages
• Can use waste heat or renewable thermal sources (like solar) instead of electricity
• Minimize power consumption while operating with other energy sources
disdvantages
• Lower coefficient of performance (COP) than vapor compression heat pumps in general
• More powerful and complex, perhaps limiting domestic application
• Often necessitate more infrastructure at the source of the heat (for instance, fuel or solar panels)
• Hybrid Heat Pumps:14
They blend the characteristics of various types (say, air-source and gas-fired) to realize performance under a wide range of conditions. They can automatically change between modes to ensure maximum efficiency as well as comfort.
Advantages
• Combines the technology of heat pumps with traditional heating systems
• Offers flexibility to adjust efficiency in accordance with external conditions
• Interchangeable energy sources in order to maximize performance
disadvantages
• More complex control and design systems
• Generally higher installation and maintenance costs
• Requires careful integration to achieve expected benefits
• Ductless Mini-Split Heat Pumps:15
Ideal for homes with no ductwork, these systems offer zoning capability, with the option to heat or cool various rooms or zones separately.
Advantages
• No Ductwork Required
• Energy Efficiency
• Zoned Comfort
disadvantages
• Higher Starting Price
• Maintenance Required Regularly
• Complexity for Bigger Homes
2 Economic Performance
- payback period
There are many factors effecting the payback period for HPs.
one of them is the Policies of each country or region.16
For example, as the solar irradiance and using heat pumps usually have a reverse relation, and a building use a heat pump and a PV panel, it should be considered the differences between costs of generating electricity by PV panels and feed-in tariff of the grid can impact the payback period directly.
For Solar Heat Pumps (SHP) comparing the aspect of payback time, it depends on solar Irradiance and ambient temperature. Payback takes more than 30 years for northern climates, but it is shorter than 21 years in southern climates. The reason is that the northern climates have less irradiation and more days with the need of heating compared to southern climates.17
- investment Cost
There are different factors that can affect the investment cost. Some of them are the capacity of heat pumps, the market we purchase, type of heat pump and technology, extra equipment added or not. For example, considering a single-family house in Denmark, it is ranged from 75 to around 1000 EUR/kW for Denmark Regarding Danish Energy Agency and Energinet 2020, installation costs also ranges from 0 to around 1000 EUR/kW for Denmark. Also, in Sweden for different technologies of heat pumps, the price increased from 2010 to 2023 and there is a significant jump from 2022 to 2023. This consistent price increase is mostly because of the effect of inflation on the economy. 18
Even if we account for inflation and remove the effect of this main parameter, there is still an increase in prices from 2010 to 2023, there is no definite reason announced for it, but the following reasons may have played a role:
Refrigerants now are more expensive, new technologies with higher efficiencies cost more than older technologies with lower efficiencies, the clients tend to get deeper underground to use more free energy sources which again add additional costs to the initial phase.
- Operating cost
This factor is mainly affected by electricity. We can divide this factor into three categories. First it is obvious that heat pumps with different technologies consume different amounts of electricity, and higher consumption means higher operational costs. Second, different climate regions need different heat supply by heat pumps. Third is the feed in tariff for electricity. With higher tariffs we should pay more for operational costs. As an example, electricity price in Germany has changed through recent years and it affects the hat pump’s operational costs. These prices can play a role in societies selecting between gas-boilers and heat pumps. 18
- Levelized costs of energy
Levelized cost of energy is based on a simple formula the costs of electricity over the lifetime of the system. The costs included are investment costs, operational costs, and energy costs. Considering different policies the emission could be included.
Comparing to boilers, heat pumps has lower levelized cost of energy, although they have higher capital and maintenance costs, they have significantly lower fuel costs.
- Production costs
The main portions of the cost of a heat pump are compressor, control system, heat exchanger respectively.
For raw material costs, based on IEA estimation the majors are copper by 50 percent, steel by 20 percent, aluminum by 15 percent and nickel 10 percent.
The China produces heat pumps by half price comparing to United States.
3 Ecological Performance
Heat pumps provide remarkable ecological benefits against climate change by reducing greenhouse gas emissions and enhancing overall energy efficiency. Comprehensive life cycle assessments (LCA) show that these advanced systems can drastically lower carbon footprints when compared to traditional fossil fuel heating methods19. By harnessing renewable electricity, emissions during operation can be reduced by an impressive 50–70% compared to conventional boilers that use fossil fuels.
While the adoption of alternative refrigerants like R-454B may result in a modest dip in energy performance, the huge impact on emissions cannot be overlooked. As the electricity grid becomes increasingly decarbonized and integrates more renewable energy, the benefits of heat pumps are expected to amplify even further.
A key challenge in heat pump technology is that it relies on refrigerants that can greatly contribute to global warming. However, recent technological advancements have catalyzed a shift toward more environmentally friendly options, such as natural refrigerants like and ammonia, as well as low-GWP (Global Warming Potential) synthetic alternatives. Even though R-454B will have a minor penalty in efficiency, its considerably reduced global warming potential translates into a substantial reduction in direct
emissions throughout the life of the system. This significant change is required in order to adhere to rigorous international standards for curbing harmful emissions as well as for the preservation of the environment.20
Beyond their substantial energy-saving capabilities and reduced carbon footprints, heat pumps also enhance resource efficiency by reclaiming waste heat from diverse sources—industrial processes, sewage systems, and urban environments. By transforming otherwise wasted thermal energy into usable heat, these systems significantly lessen the overall demand for additional fuel. When integrated with complementary technologies like solar thermal collectors, the efficiency of the entire system sees considerable improvement, potentially satisfying a substantial portion of heating needs in densely populated urban areas. Consequently, modern heat pump technology stands out not only for its ability to mitigate emissions but also for its role in promoting a sustainable and resource-efficient approach to energy utilization throughout its operational lifespan.21 Table 1 presents a comparative analysis of heating methods and conventional systems.
4 Social Impact
The world’s population is growing, which naturally means that energy needs are also rising quickly. Currently, the most common energy sources are coal and natural gas. Researchers predict that coal, natural gas, and oil reserves will soon run out. Therefore, in order to meet our countries’ energy needs, fresh and renewable energy is required. That means to get rid of carbon emissions from energy, big changes need to be made to a lot of things, from how electricity is spread on a large scale to how resources like wind and solar are used, as well as how smart infrastructure and modeling methods are created. The ramifications of these changes are interdisciplinary and require the holistic consideration of socio-economic, environmen- tal, engineering and political factors over a range of geo- graphic and seasonal time scales.23 Thus, we will outline the impacts of heat pumps in this section:
- noise pollution caused by air-source heat pumps
Air-source heat pumps (ASHPs) are becoming more popular in Vinex neighborhoods for heating and cooling. However, noise from these systems, which is mostly generated by fans, might cause people to be irritated and have difficulty sleeping. Studies have found that normal ASHP noises might have a negative impact on sleep quality, concentration, and mood.
To limit these effects, consider issues such as outside unit placement, the use of acoustic enclosures, and noise laws during installation. Proper planning and design can dramatically reduce ASHP noise impact while balancing sustainability aims and home comfort.24
- Cost Change for Home Heating (2019 vs. 2022)
Equation (1) is used to compute the change in residential heating cost (ΔC) using the average prices of gas and electricity for 2019 (0.188 £/kWh for electricity, 0.043 £/kWh for gas) and 2022 (0.322 £/kWh for electricity, 0.083 £/kWh for gas).25
(1)
where and
are the unit costs of gas and electricity respectively. 𝛥𝐺 represents a decrease in gas consumption and 𝛥𝐸represents an increase in electricity consumption.
Most places saw a rise in heating expenses in 2019, with northern England seeing the biggest increase. Similar trends were seen in 2022, although prices in the north of England increased while those in the south declined. As explained in section SI.1 of the Supplementary Information, these modifications may result in notable emission reductions.
The monthly change in heating costs varies based on temperature differences. In an example region in UK, costs fluctuate between the highest and lowest temperatures each month. This variation is significant, with heating costs changing by around £20 per month per household in 2022.26
- Impact of Price Ratio
The analysis emphasizes that when assessing cost changes, the ratio of gas to electricity prices has a greater impact than their absolute amounts. With the exception of 2013’s extraordinary lows and 2020–2021’s highs brought on by COVID-19, historical price ratios have primarily remained between 3.25 and 5. Gas prices were held constant at 2019 levels while electricity costs were changed to evaluate the effect. Although regional differences are not as noticeable as they were in earlier observations, the data demonstrate that greater price ratios result in higher prices, with a general pattern of rising costs from south to north. Furthermore, inequality grows as the price ratio climbs, with the greatest increase occurring between ratios of 3.5 and 4. Regional gaps in inequality become stable after the ratio reaches 4.25.26
- Lower Carbon Emission of Heat pump
The carbon footprint is the amount of greenhouse gases (CO2), including carbon dioxide, emitted into the atmosphere by our daily activities and consumptions, expressed in tons equivalent. In simplest terms, it might be described as the numerical equivalent of the environmental damage we produce. Many elements influence the production of carbon footprints, including transportation, the heaters we use for warmth, the food we prepare, and even the power we consume. The term zero carbon heating refers to heating methods that produce no carbon emissions during the energy generating and heating process. Traditional heating systems primarily employ fossil fuels (natural gas and coal). The usage of these fuels contributes to climate change and environmental issues by releasing carbon and greenhouse gas emissions. However, renewable energy sources are used in zero-carbon heating systems. Using renewable energy sources produces no carbon emissions.27
Heat pumps are the primary technique for de-livery electrification of heating. Electrification is viewed as a significant global contributor to climate change mitigation since low-carbon electricity has the potential to replace present fossil fuel consumption in buildings and surface transportation. On the supply side, ideas for achieving low carbon emissions by 2050 often include more renewable or nuclear energy, as well as carbon capture and storage for fossil fuel electricity production. In the United Kingdom, domestic heating consumed 19% of delivered energy in 2012 (Palmer and Cooper, 2013). In the EU-28, residential heating accounts for 17.5% of total delivered energy.28
Ground source heat pumps extract energy from the soil, and the system requires power to operate. If the electricity utilized is generated from renewable energy sources, these systems will emit no carbon dioxide. Thus, the system will have achieved net zero carbon emissions.27
The greatest impact of this sector is on the health of society.
Also, we will outline the benefits and drawbacks of heat pumps in this section:
Emissions of greenhouse gases and carbon are reduced using heat pumps. They are therefore good for the environment. Because they use energy efficiently, they have lower operational costs. When compared to traditional heating and cooling systems, it can also result in notable utility bill savings.On the other side, heat pumps lower greenhouse gas emissions in contrast to traditional heating and cooling systems that rely on fossil fuels. They contribute to reducing carbon footprints and stopping climate change by using renewable energy sources.27
We can list the following as a drawback:
Heat pumps often have a high initial installation cost. High-quality design and implementation are also required. If not, system performance might not meet expectations. In order to construct the ground loop, heat pumps require sufficient acreage. Also, ground source heat pump systems can be complicated to install and maintain, requiring knowledge and experience. On the other hand, unknown soil maps cause application issues for some soils.27
5 Political and Legal Aspects
In this section we peovide the political and legal aspects of heat pump technology, it will be discussed the key policies, regulations, and their effects on the development and diffusion of the technology across different countries.
We have two important policies including:
The EU Taxonomy Regulation (EU 2020/852) encourages energy efficiency technology, such as heat pumps, as part of the EU’s sustainable finance agenda.29
United States Inflation Reduction Act (2022): Offers rebates and tax credits for energy-efficient home modifications, such as heat pumps.
Although for them we have some pros like , significant environmental benefits or low-carbon technologies on the other hand we have some cons like, increaseing energy costs for consumers.
Different laws have been enacted in each country and continent, according to the goals set for the coming years. For instance in the United Kingdom has set ambitious climate targets, with the goal of achieving net zero emissions by 2050. The home sector accounts for 15% of total direct greenhouse gas emissions, which are caused by fuel combustion for heating and cooking, garden machinery, and aerosol pollutants. Thus, electrification of the energy system is required to achieve this.
Residential heat electrification is one step toward decarbonizing the energy system. Heat Pumps are a potentially highly efficient type of low-carbon heat and could play an essential role in the transition to a low-carbon economy. Also in this country, the Committee on Climate Change claims that Heat Pumps can efficiently heat households and, with greater insulation, underfloor heating, and appropriate radiatorscan be as effective as gas boilers. In its most current study on reducing GHG emissions from the residential sector, the CCC recommends that 10 million Heat Pumps be installed in existing and new residential buildings by 2030.
Recently, the government announced plans to build 600,000 heat pumps per year by 2028.30 31
Furthermore we have some especial policy for implementation, for example in Lithuania in accordance with the National Energy Strategy and European policy, covering the period 2005-2013 following Lithuania’s accession to the EU. A heat pump always has both an outdoor heat source and an inside outlet. Outdoor sources include ambient air, exhaust air, ground rock, groundwater, and water. Energy from these sources is unlimited and thus renewable. This energy accounts for approximately 75% of the energy delivered by heat pumps. The refrigerant then makes its way to the compressor, which is the heart of a heat pump. The compressor compresses the refrigerant, which is gaseous, to a high pressure, increasing its temperature.
Additional energy is required to drive the compressor, which can be obtained from electricity, gas, or thermal sources. They account for 25% of the total energy required to run the heat pump. If green electricity is used, such as photovoltaic, a Heat Pump is completely renewable and thus CO2 neutral.32
Also, there are a lot of Research and Development (R&D) Support in EU and US for this sector like Committed to Restoring America’s Energy Dominance which can supports innovation and technological improvements or can help lower long-term costs and improve performance.
Given that the issue of network integration is very important in most electricity generation and distribution networks, we should also look at network integration rules. That means Heat Pumps can be integrated with smart grids, enabling more efficient and flexible energy use. Policies supporting grid modernization and renewable energy integration can encourage Heat Pump adoption. These policies collectively drive the successful integration of renewable energy while ensuring grid reliability and economic feasibility.33
Also, in the United States we have some policies that aggressive decarbonization targets have proliferated among states. For instance, New York’s Climate Leadership and Community Protection Act (CLCPA) requires the state to cut GHG emissions by at least 85% below 1990 levels by 2050. In addition to decarbonizing power production, the plan calls for electrification of transportation and buildings, which would necessitate the replacement of fossil-fired heating equipment with electric heat pumps (Heat Pumps) in homes. Globally, heat pumps are quickly becoming the norm for decarbonizing space heating in chilly nations.34
Tax credits are available for 30% of investments up to $2000 per household. Low and moderate income (LMI) households with income less than 150% of Area Media Income (AMI) can also earn rebates up to $8000.
Even if these measures are likely to increase building electrification, the amount to which households will adopt them, particularly in cold regions, is uncertain and likely to be hampered by a variety of impediments, some of which are unknown, such as idiosyncratic building characteristics.34
In China, they emphasize that the efficiency, flexibility, and significant potential of heat pumps for reducing carbon emissions position them to exert a substantial influence on the future energy transition. Specifically, under the most optimistic scenario, heat pumps could reduce emissions in this country for industrial heating by 2060.
China’s non-fossil energy proportion is set to rise from 25% in 2030 to 80% in 2060 (source: State Council of China), while the world’s installed renewable power capacity is predicted to exceed 6200 GW after 2026. Furthermore, a sustainable global heat transition will require higher utilization of waste heat or even ambient heat, resulting in lower costs. It is estimated that China’s current annual waste heat is equivalent to 1.3 billion tons of standard coal, and recovering waste heat equivalent to one ton of standard coal can reduce 2.77 tons of carbon, effectively relieving the pressure of significant requirements in renewable energy utilization and carbon emission reduction. In this country Heat Pumps can meet building heating requirements up to 80°C and industrial heating below 150°C, addressing 100% building heating and 50% industrial heating. Achieving a penetration rate of 90% could result in a 20% CO2 reduction overall.35
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