You might be wondering how an air-source heat pump uses the outdoor winter air to heat a home. Believe it or not: heat can be harvested from cold outdoor air down to about 40°F. And this can be accomplished through a process you're probably already familiar with—refrigeration.

Basically, a heat pump's refrigeration system consists of a compressor, and two coils made of copper tubing, which are surrounded by aluminum fins to aid heat transfer. The coils look much like the radiator in your car. Like in a refrigerator or air-conditioner, refrigerant flows continuously through pipes, back and forth from the outdoor coils. In the heating mode, liquid refrigerant extracts heat from the outside coils and air, and moves it inside as it evaporates into a gas. The indoor coils transfer heat from the refrigerant as it condenses back into a liquid. A reversing valve, near the compressor, can change the direction of the refrigerant flow for cooling as well as for defrosting the outdoor coils in winter.

When outdoor temperatures fall below 40°F, a less-efficient panel of electric resistance coils, similar to those in your toaster, kicks in to provide indoor heating. This is why air-source heat pumps aren't always very efficient for heating in areas with cold winters. Fuel-burning furnaces generally can provide a more economical way to heat homes in cooler U.S. climates.

The efficiency and performance of today's air-source heat pumps is one-and-a-half to two times greater than those available 30 years ago.