Types of Heat Pumps: Air Source, Ground Source and Water Source

There are three main types of heat pumps, distinguished by where they draw heat from: air source, ground source, and water source. All three work on the same principle, moving heat from one place to another rather than generating it, and the difference lies in what supplies that heat.

Each type suits different conditions, with location, climate, installation cost, and available land determining which fits a particular building. This guide compares all three, explains the subtypes within each, and sets out how to choose.

The Three Types Compared

Aspect	Air source	Ground source	Water source
Heat drawn from	Outdoor air	The ground	A lake, river, or well
Efficiency (COP)	3 to 4.5	4 to 6	4 to 6
Source stability	Varies with weather	Very stable year-round	Stable
Installation cost	Lowest	Highest	Moderate to high
Ground works	None	Excavation or drilling	Water access and permits
Land required	Space for one outdoor unit	Significant, or drilling access	Access to a water body
Retrofit suitability	Straightforward	Difficult in finished properties	Site-dependent
Prevalence	By far the most common	Less common	Least common

Types of Heat Pumps: Air Source

This is the most common type by a wide margin. It transfers heat between outdoor air and the building, providing heating and hot water, and reversing the process to deliver cooling. It works by extracting heat from the air even in cold conditions, because air above absolute zero contains extractable heat and the refrigerant inside is colder still.

The main components are an evaporator coil that absorbs heat from outdoor air, a compressor that raises the temperature of that heat, a condenser that releases it into the building’s system, and an expansion valve regulating refrigerant flow. Our guide to heat pump components covers each part in detail.

Air source units dominate because they require no excavation, no drilling, no land, and no water access. Installation is comparatively straightforward, and the initial cost is the lowest of the three types, with savings on running cost recovering the difference against conventional heating over time.

Air-to-air and air-to-water: the distinction that matters

Within the air source category sit two quite different products, and confusing them is the most common sourcing error in this space.

Air-to-air transfers heat directly into indoor air through a wall or ceiling unit. This is what a reversible split air conditioner does. There is no water anywhere in the system.

Air-to-water transfers heat into water, which then circulates through hydronic underfloor heating, radiators, or a hot water cylinder.

Aspect	Air-to-air	Air-to-water
Delivers heat into	Indoor air directly	A water circuit
Emitter	Wall or ceiling unit	Underfloor loops, radiators, fan coils
Domestic hot water	No	Yes, with a cylinder
Suits buildings with	Ducts, or no existing distribution	Existing wet heating

They are not interchangeable. A building with radiators or underfloor loops needs air-to-water. Our guide to air to water heat pumps covers that category in depth.

Cold climate performance

The objection that air source units fail in cold weather is largely outdated for current equipment. Modern cold-climate models maintain useful output well below freezing, with Legom heat pumps engineered to operate down to -35°C ambient.

Output does decline as temperature falls, which is unavoidable physics for any air source unit rather than a product weakness, so cold-climate projects should be sized against the local design temperature rather than the nominal rating.

Types of Heat Pumps: Ground Source

Also called a geothermal heat pump, this transfers heat between the building and the ground. It is more efficient than an air source model because ground temperature is far more stable than air temperature.

In winter it extracts heat from the ground and moves it indoors. In summer the process reverses, drawing heat from the building and transferring it into the cooler ground. A heat exchanger buried in the ground absorbs or releases that heat.

Installation costs more than other types because it requires a ground loop, either horizontal or vertical.

Horizontal loops

Pipes laid in shallow trenches across a large area of ground. Excavation is straightforward and cheaper than drilling, which makes this the lower-cost option where land is available.

That last condition is the constraint. A horizontal loop needs a considerable area of accessible ground that can be excavated and then left undisturbed, which rules it out for most urban plots and for properties with established landscaping. It suits rural and suburban properties with open land rather than large buildings specifically.

Vertical loops

Boreholes drilled to depth, with pipe inserted and the borehole grouted. Land area is not the constraint here, only drilling access, which is why larger commercial buildings typically use vertical loops: they need substantial capacity from a limited footprint.

The cost is higher because drilling equipment and expertise are involved, and geology affects the price considerably. Deeper ground also delivers more stable temperature, so vertical loops perform more consistently across the seasons than horizontal ones.

Lifespan and efficiency

Ground source is highly efficient because it transfers heat rather than generating it through combustion, and it draws on renewable heat from the earth, reducing dependence on fossil fuels.

Lifespan is a genuine advantage, though it applies unevenly. The buried ground loop is inert plastic pipe with no moving parts and can last 50 years or more. The heat pump unit itself, containing a compressor and controls, typically lasts around 20 to 25 years. So the expensive and disruptive part of the installation outlives several replacements of the mechanical equipment, which improves the long-term economics considerably once the ground works are done.

For a fuller treatment including open loop, closed loop, and direct exchange systems, see our guide to geothermal heat pumps.

Types of Heat Pumps: Water Source

This type uses water as the heat exchange medium. Rather than drawing from outdoor air, it relies on water from a nearby source such as a lake, river, well, or a shared building loop.

Water carries heat more readily than soil or air, and its temperature is more stable than air, which allows efficiency comparable to or exceeding ground source. In winter it extracts heat from the water and transfers it inside; in summer it removes heat from the building and releases it into the water.

Closed loop and open loop

Closed-loop systems circulate a sealed fluid through pipes buried in the ground or submerged in a body of water. The fluid never contacts the water source, which removes water quality from the equation entirely.

Open-loop systems draw water directly from a well, river, or lake, pass it through a heat exchanger, then return it to the source. Efficiency is higher because heat transfer is direct with no intermediate loop, but the water quality becomes a design factor: hard water deposits scale on the heat exchanger, iron content causes fouling, and acidic water corrodes.

Where water source suits

These systems work best where a reliable water supply exists, which is the limiting condition. Commercial, industrial, and multi-family buildings with access to a suitable water body are the typical applications.

Two practical constraints apply beyond availability. Water must be returned or discharged somewhere after use, and most jurisdictions regulate abstraction and discharge, sometimes strictly. Establish the regulatory position early, since permits can invalidate an otherwise sound design.

Hybrid Systems

Worth knowing as a fourth arrangement rather than a fourth type. A hybrid pairs a heat pump with an existing boiler, switching between them according to conditions.

The heat pump covers most of the heating season efficiently while the boiler handles the coldest days when heat pump output falls. This allows the heat pump to be sized for typical rather than peak demand, reducing its cost, and it suits retrofit projects where replacing all the emitters is impractical.

The trade-off is that a fossil fuel appliance stays in the building with its flue, fuel connection, and maintenance obligations, so in markets phasing out gas heating it is best regarded as a transitional step.

How to Choose

Four questions narrow the field quickly, and they are worth working through in order.

1. What does the site allow?

This eliminates options faster than anything else. No land and no drilling access rules out ground source. No water body rules out water source. What remains is air source, which is why it accounts for the overwhelming majority of installations.

2. Is this new build or retrofit?

In new construction, ground works can be done before the site is finished, and the additional cost is more easily absorbed. In a finished property with established landscaping, excavation or drilling becomes disruptive and expensive, and air source is usually the practical answer.

3. What will it feed?

This determines whether you need air-to-air or air-to-water, and it matters more than the source type. A building with radiators or underfloor loops needs a water-based output. One with ducts or no existing distribution may suit air-to-air.

It also determines the flow temperature required, which affects efficiency substantially. A unit producing 35°C water for underfloor heating achieves a considerably higher COP than the same unit producing 45°C for radiators.

4. How long will you hold the property?

Ground and water source carry higher upfront cost and lower running cost, so the case depends on recovering that difference over time. A household planning to stay for decades weighs this differently from one planning to move within a few years.

Which Type Legom Manufactures

Being clear about this saves buyers a wasted enquiry.

Legom manufactures air-to-water monoblock heat pumps, producing hot or chilled water for hydronic systems. We do not produce air-to-air split units, ground source, or water source equipment.

Parameter	5 kW	6 kW	9 kW	16 kW
Heating range	2.0–6.0 kW	3.0–8.0 kW	3.5–10.0 kW	6.5–18.0 kW
COP at A7/W35	4.5	4.42	4.46	4.53
Hot water capacity	6 kW	8 kW	10 kW	18 kW
Cooling capacity	4 kW	5 kW	6.5 kW	14 kW
Minimum ambient	-35°C	-35°C	-35°C	-35°C

All models use R32 refrigerant with full DC inverter compressors, provide reversible heating and cooling, and carry CE and RoHS certification. Because we also manufacture the manifolds, floor heating pipe, thermal actuators, and room thermostats that complete a hydronic system, a full installation can be sourced from one manufacturer.

Those distribution and control components work equally with a ground source or water source heat pump, since all three produce hot water for the same wet system. If your project requires ground source equipment specifically, we can still supply the distribution side. OEM and ODM services are available across the range.

“The type question usually answers itself once you look at the site. If there is no land and no drilling access, ground source is off the table whatever its efficiency advantage. If there is no water body, so is water source. That is why air source accounts for the overwhelming majority of installations, and it is not a compromise: modern units run to minus thirty-five and the efficiency gap has narrowed considerably. The question worth spending time on is not which source, but what the unit will feed, because that decides the flow temperature and the flow temperature decides the efficiency you actually get.”
— Maggie Shen, Director of Legom

Frequently Asked Questions

What are the main types of heat pumps?

Three, distinguished by where they draw heat from. Air source extracts heat from outdoor air and is by far the most common, requiring no ground works or water access. Ground source, also called geothermal, draws from the ground through a buried loop and achieves higher efficiency because ground temperature is more stable. Water source uses a lake, river, or well as the heat exchange medium, achieving similar efficiency where a suitable water body exists.

Which type of heat pump is most efficient?

Ground source and water source typically achieve a COP of 4 to 6, against 3 to 4.5 for air source, and their efficiency is more consistent across the seasons. The reason is source temperature: ground a few metres down stays near 10°C year-round while air can fall to -15°C or lower, so an air source unit works from a colder source exactly when heating demand peaks. However, efficiency alone rarely decides the choice, since site conditions frequently eliminate the more efficient options.

What is the difference between air-to-air and air-to-water?

Where the heat is delivered. Air-to-air transfers heat directly into indoor air through a wall or ceiling unit, which is what a reversible split air conditioner does. Air-to-water transfers heat into a water circuit feeding underfloor heating, radiators, or a hot water cylinder. They are not interchangeable: buildings with wet heating need air-to-water, and only air-to-water can supply domestic hot water. This distinction matters more than the source type in most sourcing decisions.

Should I choose a horizontal or vertical ground loop?

Land availability decides it. A horizontal loop is cheaper because trenching costs less than drilling, but it needs a considerable area of accessible ground that can be excavated and then left undisturbed, which rules it out for most urban plots. A vertical loop needs only drilling access rather than land area, which is why larger commercial buildings typically use them: substantial capacity from a limited footprint. Vertical loops also perform more consistently, since deeper ground is more thermally stable.

How long do heat pumps last?

The answer differs by component, particularly for ground source. The buried ground loop is inert plastic pipe with no moving parts and can last 50 years or more, while the heat pump unit itself with its compressor and controls typically lasts 20 to 25 years. So the expensive and disruptive part outlives several replacements of the mechanical equipment. Air source units have a comparable service life for the equipment, with no buried infrastructure to consider.

What is the difference between closed loop and open loop water source?

Closed-loop systems circulate a sealed fluid through pipes submerged in water or buried in ground, so the fluid never contacts the water source and water quality is irrelevant. Open-loop systems draw water directly from a well, river, or lake, pass it through a heat exchanger, and return it. Open loop achieves higher efficiency through direct heat transfer, but water quality becomes a design factor since hard water scales the exchanger, iron fouls it, and acidic water corrodes it.

Do I need a permit for a ground or water source heat pump?

Frequently yes, and requirements vary considerably by jurisdiction. Drilling boreholes may require notification or permission depending on local groundwater protection rules. Water abstraction and discharge are regulated in most places, sometimes strictly, with permits potentially limiting volume or requiring monitoring, and occasionally refused in areas under water stress. Establish the regulatory position early, since it can invalidate an otherwise sound design. Air source installations rarely require more than normal building consents.

Which type does Legom manufacture?

Air-to-water monoblock heat pumps, in four capacities from 5 kW to 16 kW, producing hot or chilled water for hydronic systems. We do not produce air-to-air split units, ground source, or water source equipment. We do manufacture the manifolds, floor heating pipe, thermal actuators, room thermostats, and HVAC valves that complete a hydronic installation, and those components work equally with any water-based heat source including ground and water source units.

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Reviewed by Maggie Shen, Director at Legom, on September 1, 2026. This guide to heat pump types was reviewed for technical accuracy, including ground loop selection criteria, the air-to-air and air-to-water distinction, and component lifespan figures.