In this blog post, we’ll explore the operating principles and energy efficiency of heat pumps—which provide both cooling and heating—as well as the differences between air-source, water-source, and ground-source heat pumps, and the current state of heat pump technology and market trends as of 2026.
Air conditioners, which were once used solely for cooling during the summer, have now evolved into heat pump-based heating and cooling systems capable of providing both cooling and heating. Heat pumps have established themselves as one of the leading heating technologies competing with traditional boilers; they differ from conventional direct-combustion heating appliances, particularly in that they transfer thermal energy from the outside environment for heating purposes. While air conditioners in the past were primarily used for cooling, heat pump air conditioners can perform both cooling and heating functions and offer higher energy efficiency than conventional electric resistance heating. Generally, a heat pump can supply several times more thermal energy on average for every unit of electrical energy consumed, though actual performance varies depending on the type of unit, outdoor temperature, and operating conditions.
A device that absorbs heat from a low-temperature source and releases it to a high-temperature source is called a heat pump. The basic cycle of a heat pump consists of a compressor, a condenser, an expansion device, and an evaporator. As low-temperature, low-pressure liquid refrigerant is converted into gaseous refrigerant through the evaporator, it absorbs heat from the low-temperature heat source. This low-temperature, low-pressure gaseous refrigerant passes through an electrically powered compressor, where it is converted into a high-temperature, high-pressure gaseous state. This high-temperature, high-pressure gaseous refrigerant is then sent to the condenser, where it releases heat as it condenses into a liquid. As the refrigerant passes through the expansion device in its high-temperature, high-pressure liquid state, its pressure and temperature decrease, returning it to a low-temperature, low-pressure state. Consequently, the cycle in which heat absorbed by the evaporator is released by the condenser constitutes the heat pump cycle. The reason a heat pump can provide both heating and cooling is that the flow of the refrigerant can be reversed, thereby switching the roles of the condenser and evaporator.
Let’s refer to the two heat exchangers corresponding to the heat pump’s evaporator and condenser as Heat Exchanger 1 and Heat Exchanger 2, respectively. If Heat Exchanger 1 is located outdoors and Heat Exchanger 2 is located indoors, then in winter—when the outdoor temperature is relatively low and the indoor temperature is relatively high—Heat Exchanger 1, located in the low-temperature area, acts as the evaporator to absorb heat from the outside, while Heat Exchanger 2, located in the high-temperature area, acts as the condenser to release heat into the indoor space. Conversely, in summer, since the outdoor temperature is higher than the indoor temperature and the indoor temperature is relatively lower, Heat Exchanger 2, located indoors, acts as an evaporator to absorb heat from the indoor space, while Heat Exchanger 1, located outdoors, acts as a condenser to release heat to the outdoors. At this time, the flow of the refrigerant is reversed. In this way, a heat pump air conditioner can perform both cooling and heating.
Driving energy is required to transfer heat from a low-temperature source to a high-temperature source. The most commonly used driving energy for heat pumps is electrical energy, which is used to power the compressor that compresses the low-temperature, low-pressure gaseous refrigerant into a high-temperature, high-pressure state during the heat pump cycle. An interesting point is that the amount of thermal energy released during the heat pump cycle can be significantly greater than the electrical energy required to operate the heat pump. A key indicator of how much thermal energy can be supplied relative to the input drive energy is the Coefficient of Performance (COP). The COP of a heating heat pump varies significantly depending on operating conditions, but it generally exhibits high efficiency, supplying approximately 3 to 5 units of heat for every 1 unit of electricity consumed. Therefore, heat pumps achieve high efficiency not by simply converting electrical energy into heat, but by utilizing external heat sources—such as air, water, or the ground—to transfer heat.
Heat pumps can be classified into air-source, water-source, and ground-source heat pumps, depending on the external heat source they utilize. The most common type, the air-source heat pump, absorbs heat from the atmosphere and supplies it to spaces or water at relatively high temperatures. Typical heat pump air conditioners fall under the category of air-source heat pumps; they can provide both heating and cooling by absorbing heat from the outside air via the evaporator or, during cooling operation, from the indoor air. In contrast, water-source heat pumps use water as a heat source or as a medium for heat dissipation. Systems that produce hot or cold water by absorbing or releasing heat from seawater, river water, surface water, or wastewater generated by bathing facilities or factories fall into this category. Water-source heat pumps that utilize wastewater as a heat source are sometimes classified as waste heat-source heat pumps. Finally, geothermal heat pumps are systems that utilize the relatively stable temperature of the ground as a heat source. Since ground temperatures fluctuate less with the seasons than outdoor air temperatures, geothermal heat pumps have the advantage of being less affected by changes in outside temperatures compared to air-source heat pumps.
As the high energy efficiency of heat pumps becomes more widely recognized, their adoption is expanding globally alongside the electrification of heating and cooling systems. However, market conditions vary by region. While global heat pump sales in 2025 decreased by approximately 2% compared to the previous year, some regions showed signs of recovery, such as an 11% increase in sales in Europe. In 2025, heat pump sales surpassed gas boiler sales in Germany, and in the United States, heat pumps outsold gas boilers for the fourth consecutive year, indicating a continuing shift in heating methods. Therefore, rather than judging the future of the heat pump market based on the size of the domestic boiler market in a specific past year or a specific company’s sales share, it is necessary to examine the role of heat pumps within the broader context of the electrification of building heating and improvements in energy efficiency.
Another reason heat pumps are gaining attention is their potential to reduce greenhouse gas emissions. Since heat pumps transfer heat from the outside using electrical energy rather than generating heat by directly burning gas or oil, they may be more effective at reducing greenhouse gas emissions compared to heating methods that involve the direct combustion of fossil fuels within buildings. However, it cannot be concluded that heat pumps themselves emit absolutely no carbon dioxide during operation. This is because indirect greenhouse gas emissions vary depending on the source of the electricity used. The more electricity generation is decarbonized, the greater the greenhouse gas reduction effect of heat pumps becomes. The International Energy Agency (IEA) assesses that heat pumps offer higher energy efficiency than fossil fuel boilers and, when combined with low-emission electricity, can become a key technology for decarbonizing heating.
These characteristics are particularly significant for South Korea, a country with high energy import dependence. As South Korea’s energy import dependence remains high at 93.7% as of 2024, efficiently utilizing energy sources and reducing reliance on fossil fuels are critical challenges. Since heat pumps use electrical energy to supply the necessary heat while harnessing heat from the outside air, water, and the ground, they can serve as a means to improve energy efficiency and promote the electrification of the heating sector. In particular, if building insulation is improved, heat pumps are integrated with low-carbon electricity, and technologies such as demand response and thermal storage are utilized in conjunction, the energy efficiency of heat pumps and their value to the power system can be further enhanced.
