Both types of heat pumps are vastly more efficient than air conditioners, furnaces, and other types of heating systems. An air source heat pump's efficiency ranges between 175% and 300 %, while a geothermal heat pump's efficiency is between 300% and 600 %.

A heat pump extracts heat from the cold outside air and transfers it inside our home. To this end, a compressor inside the device uses electricity to increase the temperature of the heat extracted from the outside air. The heat pump can also provide cooling by transferring warm indoor air to the outside.