A heat pump is a device that transfers heat from one place to another using different air or heat sources. It can be used for both heating and cooling and is powered by electricity, using refrigerant to transfer heat. Heat pumps can extract heat from various sources, such as environmental air, exhaust air from a building, or from the ground. They are more efficient than conventional heating technologies such as boilers or electric heaters and can be cheaper to run.

A typical air source heat pump system consists of two major components: an outdoor unit and an indoor air handler unit. The outdoor unit contains a coil and a fan, which operates as either a condenser (in cooling mode) or an evaporator (in heating mode) . The fan blows outside air over the coil to facilitate the heat exchange. The indoor unit contains various important sub-components and is connected to the outdoor unit by refrigerant lines.

Heat pumps can be connected to a tank to produce sanitary hot water or provide flexibility in hydronic systems. They can also be combined with other heating systems, commonly gas, in hybrid configurations. Heat pumps are versatile, efficient cooling and heating systems that can produce two to three times more heat output than they consume to create heat. They are used in both residential and commercial applications, and large-scale heat pumps are used for district heating.