Heat pumps move heat energy from one location to another, using a reverse refrigeration cycle. The most efficient heat pumps are as energy efficient as a natural gas furnace. When correctly serviced and maintained, this is the premiere choice of equipment.
In mild climates a heat pump can be used to air condition the building during hot weather, and to warm the building using heat extracted from outdoor air in cold weather. Air-source heat pumps are generally uneconomic for outdoor temperatures much below freezing. In colder climates, geothermal heat pumps can be used to extract heat from the ground.
For economy, these systems are designed for average low winter temperatures and use supplemental heating for extreme low temperature conditions. The advantage of the heat pump is that it reduces the purchased energy required for building heating; often geothermal source systems also supply domestic hot water.
Even in places where fossil fuels provide most electricity, a geothermal system may offset greenhouse gas production since most of the energy furnished for heating is supplied from the environment, with only 15–30% purchased.