The average cost of a new heat pump is $5,897, according to home repair and improvement site Angi.^[1] Though not inexpensive, a new system could reduce your electricity costs in the long run.

Below, we’ll dive into how heat pumps work, the different types, how much installation and maintenance cost, and ways you can save on heating.

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What is a heat pump?

A heat pump is a heating and cooling system that transfers heat in and out of your home, depending on the season. During the winter, it extracts heat from the air outside and moves it inside. During warmer weather, the device works in reverse, absorbing heat inside your home and transferring it outside, cooling your space.^[2]

Unlike air conditioners and furnaces, heat pumps don’t generate heat. Instead, they use electricity to redistribute heat from one area to another. Therefore, heat pumps require less energy than other electric-powered heating and cooling devices and can cut your electricity use by approximately 50%, according to the U.S. Department of Energy.^[2]

See Also: How to Winterize a House

Types of heat pumps

Heat pumps can pull heat from different sources: the air, water, and the ground. Air-source heat pumps are the most common, but the right pump for your home depends on your location and budget.^[2]

Ducted air-source heat pumps

As the name implies, a ducted air-source heat pump requires ductwork. It can be ideal if you’d like to heat your entire home or a spacious area like your attic or basement rather than a single room. You should consider this type of heat pump if you’ll be building a new home or if your home already has a ventilation system.^[2]

Ductless air-source heat pumps

A ductless air-source heat pump (also known as a mini-split heat pump) doesn’t require ductwork. It’s relatively easy to install, requiring just a 3-inch puncture in the wall for a pipe to connect the indoor wall unit to the outdoor heat pump. A ductless air-source heat pump is best for new home additions, or if you only need conditioning in a small space.^[2]

Geothermal heat pumps

A geothermal heat pump moves heat from the ground or a water source near your home. Ground and water temperatures are typically more consistent than air temperatures, which tend to fluctuate drastically. Homeowners in regions that see extreme weather should consider a geothermal heat pump for reliable cooling and heating.^[2]

Absorption heat pumps

Absorption heat pumps transfer heat from solar, gas, and water sources. However, natural gas is commonly used for this type of heat pump, so it’s often referred to as a gas-fired heat pump. They’re relatively complex and require large units to operate adequately. Gas-fired heat pumps were initially used for commercial buildings but were recently introduced for residential use.

Absorption heat pumps are great for homes in regions with variable temperatures, where standard electric heat pumps may not be as effective. Absorption heat pumps are also ideal for large homes over 4,000 square feet that require zoned heating and cooling.^[2]

How much does heat pump installation cost?

Heat pump installation costs will vary based on the type of pump you choose, its capacity, and the contractor you hire. Contractors typically charge an average of $75 to $125 per hour for labor, according to Angi.^[1]

While a heat pump can be pricey up front, its energy efficiency could save you money in the long run. Tax benefits and cash rebates are also available to lower installation and operating costs.^[3]

Several factors influence the cost of your heat pump, including its type, its efficiency rating, its size and capacity, and your region’s climate.

Type

How much you pay for your heat pump will depend on the type you buy as well as the unique installation costs it requires. Ductless, or mini-split, heat pumps typically cost between $1,300 and $8,000, including installation, according to Angi. Absorption heat pumps, however, can cost anywhere from $18,000 to $34,000, including installation.^[1]

Efficiency

An energy-efficient heat pump uses less energy to deliver the necessary heating and cooling for your home. The two key metrics used to measure a heat pump’s efficiency are the Heating Seasonal Performance Factor (HSPF) and the Seasonal Energy Efficiency Ratio (SEER).

HSPF measures a heat pump’s efficiency during cooler seasons, while SEER determines its cooling efficiency during warmer seasons. Efficient heat pumps earn high ratings but also are typically more expensive.^[4]

Size and output

You’ll need to choose the correct size heat pump for your home. The size or capacity of a heat pump is measured in tons. Generally, 500 square feet of space in your home requires one ton of air conditioning power. For example, a 2,000-square-foot home will require four tons of cooling or heating capacity.^[5] The more tons required to cool or heat your space, the more you’ll pay for your heat pump.^[4]

Existing ductwork

If you already have ductwork in your home, heat pump installation will cost less than if the contractor needs to install ductwork. If you don’t already have ductwork, consider a ductless heat pump. Make sure to consider your home’s heating needs when deciding on a pump.

Climate

The climate you live in will influence the type of heat pump you purchase, which directly affects how much you’ll pay.

If you live in an area with consistently fluctuating air temperatures, you may need a geothermal heat pump, which typically costs more than other pumps. In contrast, an air-source heat pump is sufficient for areas with temperate climates or temperatures that rarely drop below freezing (32 degrees Fahrenheit).

People in regions that experience harsher winter conditions may need to find a heat pump that works well in below-freezing temperatures, which can ultimately increase costs.^[4]

Read More: How Much Does a New HVAC System Cost?

Heat pump maintenance costs

Heat pump repairs typically cost between $160 to $630 — however, the average cost is $395, according to HomeAdvisor. Below are some common repairs for a heat pump and their costs.^[6]

How to save money on heating

Heating a home is quite expensive, typically comprising about 29% of the average American’s utility bill.^[7] However, you can take steps to lower your energy usage and save on your energy bill, including:

Install a heat pump

You’ll have to spend a good bit of money up front to buy and install your heat pump. However, heat pumps are efficient and can save you money in the long run. You can save more than $1,000 on your electricity bill annually by switching to a heat pump, according to Consumer Reports.^[8]

Use your heater less

One of the best ways to lower your heating bill is to use your heater less. Bundle up in your coziest sweaters and blankets, then turn down your thermostat to a tolerable temperature. You can also open your curtains and let the sun warm your home.

Consider installing a smart thermostat and programming it to turn down your home’s temperature when you’re away. You can save about 10% on your energy bill by dialing your thermostat back 7 to 8 degrees Fahrenheit for eight hours a day from your typical setting, according to the U.S. Department of Energy.^[7]

Prevent heat from escaping

Ensure you get the most out of your heater by avoiding preventable heat loss. A simple and effective way to prevent heat from leaking out is to close your windows and doors tightly. You can also seal gaps and joints by using foil tape or mastic sealant. Alternatively, consider adding insulation to your walls.

Get an energy audit

An energy home assessment or an energy audit can provide you with insights on your home’s energy performance and consumption. The energy auditor will provide you with feedback on improving your home’s energy efficiency, which can save you money in the long run.^[7]

Maintain your heating system

It’s essential to conduct regular maintenance and repairs to ensure your heating system doesn’t expend more energy than needed to heat your home. A severely neglected heating system can increase your energy consumption by 10% to 25%.

Changing and cleaning your filters about once a month keeps dust and dirt from clogging your heat system and prevents damage to the compressor. Consider hiring a professional technician to inspect and service your heating system annually.^[7]

Read More: Do You Need an Inspection to Get Home Insurance?

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