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A heat pump can help to lower the environmental impact of your home — but can it save you money as well?

If you’re looking for ways to reduce your household energy bills while also doing your part for the environment, you might have heard the buzz about heat pumps as a low-emissions, cost-efficient alternative to traditional heating and cooling systems.

But what exactly is a heat pump, and will it save you money? Let’s dig in.

What is a heat pump, and how does it work?

Heat pumps regulate the temperature of your home, and emit fewer greenhouse gas emissions than traditional heating and cooling systems that rely on fossil fuels. The name ‘heat pump’ can be a bit misleading, as they work to both heat and cool your home.

There are many kinds of heat pumps, but they all operate on the same basic principle: heat transfer. During the colder months, heat pumps use electricity to extract heat from the outdoor air or ground and move it inside to warm your home. In the warmer seasons, heat pumps cool your home by moving heat from inside to the outdoors.

The two most common types of heat pumps in Canada are:

  • Air-source heat pumps (ASHPs) transfer heat from the outside air
  • Ground-source heat pumps (GSHPs), which extract heat from the ground. GSHPs are also known as geothermal heat pumps or ground-coupled heat pumps

What makes a heat pump better for the environment?

Heat pumps can help to reduce the household greenhouse gas emissions because they are powered by electricity. Electricity across Canada is often a cleaner energy source than natural gas — especially if the electricity in your area is generated by a renewable energy source, like hydro.

Is a heat pump right for my home?

Deciding if your home is suitable for a heat pump depends on several factors:

  1. Climate: While heat pumps are more efficient in moderate climates where temperatures don’t frequently drop below freezing, most heat pumps operate up to an outside low of -10 degrees Celsius. However, it is possible for cold-climate heat pumps to operate between -25 and -30 degrees Celsius. GSHPs tend to be more suitable for Canadian winters as they work well in a wider range of climates, while ASHPs are commonly used in moderate climates. However, it’s important to note that the heat produced from a heat pump is less intense than a traditional furnace and may require some getting used to.
  2. Insulation: As with any heating or cooling system, adequate insulation in your home’s walls, floors, windows, and attic is important for heat pump efficiency because less hot or cold air is lost. Good insulation helps keep the temperature inside your home from fluctuating with the weather, and it can also help lower your energy bills.
  3. Available space: Heat pump installations require outdoor and indoor units, which may not be suitable for all properties, such as apartments or townhouses.
  4. Ductwork: If your home has ductwork, it can simplify the installation of a heat pump by utilizing the existing duct system for distributing heated or cooled air. If you don’t have ductwork, you can still install ductless systems, such as mini-split heat pumps.
  5. Return on investment: It’s important to assess the initial installation cost, potential energy savings, and available incentives or rebates for heat pump installation in your area before deciding if a heat pump is the right choice for you. Installing a heat pump may lower your overall energy usage and, in turn, lower your energy bills, resulting in a considerable return on investment.

How much will installing a heat pump cost?

The cost of heat pump installation in Canada varies, depending on some of the factors above.

The cost of installing an ASHP can range from approximately $4,000 to $10,000 or more, depending on the size of the system, the efficiency rating, and the complexity of the installation.

GSHP installations tend to be more expensive due to the additional cost of ground loop installation. The cost can range from $15,000 to $30,000 or more, depending on factors such as the size of the system, the length and type of ground loop (horizontal or vertical), and the specific site conditions.

Try to obtain multiple quotes from reputable HVAC contractors in your area and use this to compare with your current energy spending to determine whether a heat pump can help you save money in the long run.

Are there any incentives for installing a heat pump?

The Canadian Greener Homes Initiative aims to help homeowners save money, create new jobs nationwide for energy advisors and fight climate change. The initiative offers various incentives and programs, including the Oil to Heat Pump Affordability Grant, which provides eligible households with up to $5,000 to cover costs that include the purchase and installation of heat pumps, necessary electrical upgrades, and safe removal of the oil tank.

Some municipalities and utility companies across Canada also offer their own energy efficiency programs and incentives, including for heat pump installations. Check with your local municipality, utility company, or HVAC contractor for more information.

The RBC Energy Saver Loan can also help you to finance energy-efficient products or services, while saving on your borrowing costs.