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A Geothermal Heat Pump (GHP)is a device that extracts heat from beneath the ground. It functions based on the fact that heat will flow from higher temperature materials to lower temperature materials by conduction or by convection (air currents). Geothermal pumps absorb energy from the ground or bodies of water to provide space and water heating. This works because the earth absorbs about 50% of the sun's energy that reaches the surface of the planet.

Taking advantage of the earth's ability to store thermal energy, ground source heating and cooling is inexpensive and environmentally friendly while still providing lots of heat. These pump systems can either pump heat from the ground into a building, or in warmer weather, from the building back into the ground. It doesn't take much electricity to run the pumps and fans, along with a compressor.

GHPs utilize the relatively constant temperature of the ground or water several feet below the surface as a source of heating and cooling and are appropriate for both retrofit or new homes. In addition to space heating and cooling, geothermal heat pumps can provide hot water with virtually no additional energy requirements because GHPs don't create heat; they merely move it from one area to another. This is a relatively new technology that can save homeowners money.

Although the initial cost of a new geothermal system is generally more expensive than a traditional heating and cooling system, the extra investment is returned within five to ten years. The ground loop piping is estimated to last over fifty years, and even the internal parts have about a 25 year life span. Every year about 50,000 new geothermal heating systems are added in the United States. They're very reasonable for most areas and can use the Earth for heating when temperatures drop and as a heat sink when it's hot outside.

Many new residential systems are equipped with desuperheaters which transfer excess heat from the geothermal heat pump's compressor to the home's hot water storage tank providing very efficient water heating. However, the desuperheater will not provide hot water during the spring and fall when the geothermal heat pump system is not operating. But because the geothermal heating system is so much more efficient than other means of water heating, some manufacturers are offering 'full demand' systems that utilize a separate heat exchanger to cost-effectively provide for hot water needs.