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Heat Pump Cost

Heat Pump Costs 2021 (Installation, Replacement, Pricing)

Looking for accurate cost information for heat pumps?

Perfect, you're in the right spot. In this guide, you'll learn:

  • What a heat pump is and the various types available
  • How to find the right heat pump for your property
  • The benefits of having a heat pump
  • The cost and how you can save on a heat pump

Heat pumps can be an energy-efficient way to heat your home. Thanks to their innovative design, they can also act as an air conditioner. The cost of a heat pump varies, ranging from a single-room pump for around $2,000 to whole-home systems that can exceed $25,000. The cost will depend on the size of your home and the type of heat pump you buy. There are ways to reduce the cost of installing a heat pump in your home, so you can enjoy the benefits of energy-efficient temperature control year-round.

What Is A Heat Pump?

Heat pumps work differently from a traditional furnace by moving heat from one place to another. Because the heat pump is only moving the warm air around, it requires significantly less energy than other heating systems and central air conditioner units.

The pump uses the natural movement of heat, called thermal equilibrium, to warm and cool your home. Warm air naturally wants to move towards colder areas, and the heat pump helps the heat move more efficiently. Heat pump systems have an indoor and outdoor unit, both of which use refrigerants to capture heat in the surrounding air. The warm air is then transferred inside during the cooler months or outside during warmer months. This helps regulate the temperature inside all year long. You may choose to pair the heat pump with an air handler for even better temperature regulation.

Heat pumps have been in use since the 1940s, but it's only been in the last few decades that Americans have begun to embrace this alternative to a central air system. Homeowners are now embracing these new systems thanks in large part to their SEER rating, which is a measure of efficiency.

What Are The Different Types Of Heat Pumps?

Air Source Heat Pump

Air source heat pumps are 300% energy efficient, meaning for every 1kW of energy they consume they produce 3kW of heat. That's a big improvement over your standard furnace system, which achieves only about 80% energy efficiency. That's a big difference in the energy efficiency ratio. These systems use fans and compressors housed in indoor and outdoor units to move warm air through ductwork, to either raise or lower the temperature. That high efficiency translates into big cost savings, as you'll use significantly less energy to warm and cool your home. That means big energy savings, with some people seeing reductions of 50% or more in their energy costs.

Ductless Mini Split Heat Pump

Ductless mini-split heat pumps are ideal for homes or spaces that don't have existing ductwork. This could be an older home or even a garage. Ductless mini-split systems operate a lot like the air source heat pumps, in that they have an indoor and outdoor unit with a condenser and evaporator that uses a refrigerant to warm and cool the air. Instead of using ductwork, though, the necessary components such as power cords, refrigerant lines, and drains go through a single tube that links the two units. Ductless mini-split heat pumps should last about 10 years with the right maintenance.

Geothermal Heat Pump

Geothermal heat pumps use ground-source heat to warm and cool the home. While the temperature above ground will vary, the temperature a few feet below the surface of the earth stays relatively constant. Heat pumps can bring this consistent temperature into the home, by using the ground for warmth in the winter and as a place to put warm air in the summer. They are the most efficient heat pump option available, reducing the cost of regulating the temperature in your home by up to 50% compared to air source heat pumps. That makes them very inexpensive to run, but their initial cost can be quite high. 

What Factors Should You Consider Before Buying A Heat Pump?

Should you install a heat pump in your home? The answer to that will depend on where you live, the infrastructure of your home, and what energy resources you have available. Here are three things to keep in mind when you consider whether a heat pump is a right choice for your home.


If you are using a mini-split or air-source heat pump, then the energy efficiency of the unit will depend on the outside temperature. The heat pump is less efficient at lower temperatures. That's because it will need to work harder to collect heat from the outside air. Some heat pumps won't work at all when the temperatures reach freezing. Newer systems, however, will work down to 0 degrees Fahrenheit. That makes them suitable for cold climates. You'll get the maximum efficiency from a heat pump in temperate climates, though, where the outdoor temperature doesn't vary quite as much. 


If you don't have a duct system in your home, mini-split ductless heat pumps can be an ideal solution. They allow you to regulate the temperature of your home using electricity as opposed to hot-water heat, propane heat, or wood-burning fireplaces. That electricity can even come from renewable resources, giving you an eco-friendly way to regulate the temperature. You can avoid the expense of remodeling to create ductwork, too. If you already have a ducted system, you can still use a heat pump in your home. In colder climates, though, a baseboard heating system can be the more efficient option. 

Natural Gas Lines

If you have natural gas lines and already benefit from a furnace, then a dual-fuel system may be the answer. This option uses both a heat pump as well as a gas furnace. The heat pump works when temperatures are relatively mild, while the gas furnace kicks on when the heat pump is no longer the most energy-efficient option. It all happens automatically, too, so you don't have to worry about remembering to switch between the two depending on the weather. 

What Are The Benefits Of Having A Heat Pump?

  • Lower monthly energy bills. You'll end up paying a lot less to heat and cool your home, which can offset the installation costs. Homeowners who install a heat pump can register a big drop of up to 50% on their monthly energy bills. You can compare their efficiency rating to see for yourself.
  • They are very low maintenance. Like your home's HVAC systems, heat pumps should receive regular maintenance to make sure they are working as well as possible. With minimal upkeep, though, they should last for a decade or more. 
  • Eco-friendly heating for your home. Columbia University reports that about 42% of New York City's total greenhouse gas emissions come from residential heating. Changing to heat pumps can significantly reduce those emissions and their impact on the environment. 
  • Can help stabilize the humidity in your home. Because of the way heat pumps work, they don't end up drying out the air in your home as much in the winter. They can add moisture to the indoor air in the summer, too. 
  • They both heat and cool your home. Instead of paying out for a system to heat your home and another one to cool it, a heat pump can do both. If you are replacing both a heating and air conditioning system, then installing a heat pump instead could be the less expensive option. 

What Size Heat Pump Do You Need?

Choosing the right size is key to getting a heat pump you'll love. A unit that is too small will struggle to regulate the temperature of your space. One that's too big will be a waste of energy, resources, and your money.

The best way to determine what size heat pump you need is to speak to a heat pump installation expert such as a local HVAC company. They'll use specific industry guidelines to determine which unit is right for you. They'll also take into account things like how many live in the home, your personal temperature preferences, and the insulation used in your house.

However, if you want a rough estimate for what size heat pump to buy, you can start by measuring your space. Then, for every 500 square feet, you'll want one ton of air conditioning capacity or 12,000 BTU. You'll find the system's BTUs listed in the specs from manufacturers such as Trane or Goodman. For example, if you have a 1500 square foot space, you'll want a heat pump that has a three-ton air conditioning capacity, or 36,000 BTUs. 

What Is The Average Cost To Install A Heat Pump?

The cost to have an HVAC professional install a heat pump will vary depending on many factors, including the size of your space, who does the installation, and the existing ductwork. Because of these variables, you'll see a range of prices for heat pumps and installation costs. Get quotes from several different installers so you can make sure you are getting the best deal. In general, though, you can expect the following costs on heat pump installation for your home: 

  • Air source heat pumps: Between $3,000 and $5,000
  • Ductless mini-split heat pumps: Anywhere from $1,200 for a single-room unit to $12,000 or more for a whole-home system
  • Geothermal systems: At least $10,000 for a geothermal system, and up to as much as $50,000

Of course, these costs may be offset by the money you save on heating your home, as the operating costs can be significantly lower than with other heating systems. You can learn more about heating costs here: 

How To Save Money On Heat Pumps?

If you want to have a heat pump installed in your home but the upfront expense of the system is a concern, there are ways you can save money on a new heat pump. Put these tips into practice to bring the cost of a heat pump down and make it a more affordable option for your home: 

  • Do the installation work yourself. If you are relatively handy and love a DIY project, you may be able to do the installation work yourself. This can save you thousands on installation costs and you'll only need to pay for the parts. 
  • Shop around. Installation costs will vary widely even within the same town, so make sure you shop around with different HVAC companies. Companies that do a lot of heat pump installations are likely to be less expensive than a company that hasn't done very many of them. Get quotes from several local companies on their pricing and labor costs and see who offers you the best deal. 
  • Make sure you buy a unit that's the right size. Buying a unit that's too small will end up costing you more to operate over the long term. Buying one that's too big will be a lot of unnecessary expense upfront. Talk to a professional to make sure you are getting a heat pump that's the right size.
  • Maintain your heat pump regularly. Make sure the filters are clean and get a professional to service the system once a year. Good maintenance like this can extend the life of your heat pump and prevent you from paying out for a new one too soon. 
  • Pair it with a programmable thermostat. A programmable thermostat will make sure the heat pump isn't working too hard when it doesn't need to. You'll be able to automatically raise and lower the temperature throughout the day to maximize the efficiency of the unit. 
  • Look for rebates. There are several state and federal government programs available to help lower the cost of installing a heat pump. Check with your local government to see if they are offering rebates on heat pump installation. You should also see if there are any tax credits available from the Federal Government.

Heat pumps can be a great energy-saving way to heat and cool your home. Finding the right system at a great installation price can deliver inexpensive heating and cooling that's easier on the environment and your wallet.


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