"We installed heat pumps."
Ed Schwartz and Julie Tung, Ridgewood, New Jersey

How They Work: An air-source heat pump looks something like a central AC compressor, and in summer it works the same way, pumping heat to the outside through lines filled with refrigerant.
During the winter, the same pump extracts heat from the outdoor air—surprisingly, even cold air still contains a large amount of heat—and sends it inside. Air handlers blow the heated or cooled air through a home's ductwork. Some systems may be equipped with humidifiers for winter comfort and filters to trap allergens.
Historically, heat pumps didn't work well in areas where temperatures dropped below 35 degrees F, but Hallowell International recently introduced an "all-climate" heat pump called the Acadia, which works when the mercury dips as low as –30 degrees F. The Bangor, Maine, company says this system can reduce heating and cooling costs by at least 60 percent.

What These Homeowners Did: While completing a renovation of their 5,000-square-foot house, much of it dating to the 18th and 19th centuries, Ed and Julie replaced an ancient furnace with two Hallowell all-climate heat pumps.

What They Learned: Last winter, when temperatures fell to the single digits, the two pumps kept the house a toasty 70 degrees F, even though some rooms were still uninsulated. And at the height of a heat wave last summer, they got the temperature down to 76 degrees. The key is to leave the thermostat at a set temperature for about eight hours at a time so that each pump can perform at peak efficiency.
It also pays to insulate and seal air leaks. By doing this, the owners were able to buy a smaller, less costly system.

Keep in Mind: New ductwork and thick, old plaster walls aren't a natural fit. To minimize the number of openings in the walls, Ed and Julie located one air handler in the attic and one in the basement.

Payback Period: 7 years
Their Cost: $15,000 for each heat pump, uninstalled; new ductwork not included
Yearly Savings on Oil Heat: $2,100
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