Heat pumps have become a hot topic of conversation, even if many aren’t sure exactly what they are. U.S. President Joe Biden and Canadian Prime Minister Justin Trudeau are touting them as an important strategy to fight climate change because of their energy efficiency compared to other home heating systems. And the Biden administration announced a $169 million initiative in November to accelerate domestic heat pump manufacturing.
Heat pumps don’t require fossil fuels and can significantly reduce carbon emissions for homeowners. But since they use electricity, they still may draw on a dirty energy mix depending on where the home’s power comes from.
Until recently, heat pumps were not seen as an ideal solution for cold places like Michigan, but that analysis is changing as heat pump technology improves. New federal tax credits for heat pumps may also make switching to a heat pump more appealing.
Homeowners may need to improve energy efficiency before putting in a heat pump. They may also need to upgrade their electrical systems. And choosing a heat pump that fits your budget and home heating and cooling needs can be confusing with several different models available.
But can heat pumps work in Michigan? Here are the answers to some common questions to help you decide if this technology is right for you.
Table of Contents
- What the heck is a heat pump?
- What are the different types of heat pumps?
- What heat pumps work best in a cold climate?
- Will you need new windows and insulation to install a heat pump?
- Will you need an electrical upgrade to install a heat pump?
- Will a heat pump save you money in Michigan?
- How do heat pumps in Michigan help with climate and health?
- What else should I know about heat pumps in Michigan?
What the heck is a heat pump?
Although they’re called “heat pumps,” these devices can cool and heat. They do this by transferring heat instead of generating it, absorbing “free” heat from outside the home in cool weather, and moving it inside. In warm weather, they do the same thing in reverse.
Even in cold weather, thermal energy in the air is attracted to the coolant in the heat pump, using technology similar to an air conditioner.
This device then sends the air indoors, compressing it in the process, which creates additional warming. And heat pumps can work well even in very cold areas like Maine, where the technology has been widely adopted to replace expensive heating oil.
What are the different types of heat pumps?
A few common types of heat pumps offer various advantages and disadvantages depending on the homeowner’s budget and how they currently heat or cool their home. These are:
- Ducted air source heat pump: This is the most common type. It takes air from outside and brings it indoors, using ducts like central cooling and heating systems do. This makes air-source heat pumps a relatively easy conversion for those with a central air conditioning or heating system.
- Ductless air source heat pump: A mini-split system may be the best option for those without ducts. These heat pumps avoid the energy loss that can occur with duct systems and usually only require a three-inch hole through the wall for conduit. Mini-splits can also be a good solution for an addition or other area not serviced by the central system. They function like a window unit air conditioner. One drawback is that the air handlers needed to move hot or cold air into a room can be conspicuous and don’t have the built-in appearance of central systems.
- Geothermal heat pump: These systems transfer heat from the ground or water, increasing efficiency and lowering operating costs. However, they can be much more expensive to install because they require digging trenches. Geothermal heat pumps may not be workable depending on the size of the lot or soil type.
- Hybrid system: Some have opted to install a heat pump and keep their gas or oil furnace as a backup. This could help cut costs during cold spells and may cut emissions on the coldest days in areas where the grid is still dependent on fossil fuel generation.
What heat pumps work best in a cold climate?
According to Consumer Reports, a cold-climate heat pump’s most important feature is having a “variable speed compressor.” The compressor applies pressure to the refrigerant to help warm it before it goes through a heat exchanger to transfer warm air to the inside of the house.
A single-speed compressor will switch on and off, which can cause a house to get overly hot when it’s running or cold when it switches off. However, a variable speed compressor can better adjust to maintain a steady temperature as the weather becomes extremely hot or cold. This is especially helpful in places like Michigan that experience big temperature swings between seasons, where steady warming or cooling is needed on very hot or cold days.
Energy Star provides a list of heat pumps recommended for cold climates.
Will you need new windows and insulation to install a heat pump?
Like other heating sources, heat pumps work best with good windows and insulation. But these upgrades can be especially important with a heat pump because it warms with a constant stream of warm air rather than blasts of heat from a furnace. Putting a heat pump in a poorly insulated home could allow for drafts and cold areas. It may also be a good idea to insulate ductwork to keep too much heat from escaping.
Will you need an electrical upgrade to install a heat pump?
Homeowners might have to upgrade their electrical service to power a larger heat pump. Some older electrical panels only have 60 or 100 amps, while a modern panel of 200 amps is recommended for use with heat pumps, an upgrade that could cost a few thousand dollars.
Will a heat pump save you money in Michigan?
The financial benefit of installing a heat pump varies depending on the home’s current heating system, fuel source costs, and the climate.
Air source heat pumps typically cost between $4,000 and $8,000, including installation, although more expensive models can cost as much as $12,000. This can make putting in a heat pump more expensive than a furnace. However, the heat pump will also provide air conditioning.
A heat pump’s savings come from a reduction in energy costs. Since much of Michigan uses relatively efficient natural gas, savings are lower than elsewhere. According to a 2022 analysis prepared by the consulting firm Guidehouse Inc. for the Michigan Public Service Commission, replacing a gas furnace with a heat pump in a home built before 1978 offered no financial benefit.
Much of the additional expense cited in the study was due to the difference in upfront costs between a central cold climate heat pump and a gas furnace and air conditioning system. However, this analysis didn’t account for the new tax credits under the Inflation Reduction Act, which offers up to 30% of the purchase cost of a heat pump and $2000 for installation. It also provides credits of up to $1,200 a year for home electrification.
Additionally, the IRA offers instant rebates worth as much as $14,000 for all home electrification projects, including water heaters, electric panels and heat pump clothes dryers, for those making up to 150% of the median area income. This also includes up to $8,000 for heat pumps.
Changes to electric rates and natural gas prices could also impact the cost of operating heat pumps or gas furnaces.
Some experts predict that the United States’ growing natural gas exports to Europe could raise domestic prices in the future.
How do heat pumps in Michigan help with climate and health?
Air-source heat pumps are incredibly efficient, generating three times more heat than the energy they consume. Geothermal heat pumps can produce up to four times as much.
The carbon reductions from a heat pump vary depending on how one is currently heating their home. The average household with electrical baseboard heaters would see a whopping 7.1-ton reduction in carbon emissions, while natural gas users would get a still-significant 1.1-ton reduction.
An international flight equates to about 1 ton of carbon emissions. These emission reductions will increase as Michigan adds more renewables to the grid.
There are also health benefits to making the switch. Like gas stoves, gas-powered furnaces and water heaters are associated with a higher incidence of asthma. Gas, oil, and propane heating systems all carry a risk of gas or carbon monoxide leaks.
What else should I know about heat pumps in Michigan?
Many homeowners wait until a furnace or other appliance stops working before they look for a replacement. Yet, with many looking to take advantage of federal tax credits and rebates, finding someone qualified to do the replacement work may be difficult.
Those who have installed heat pumps — or tried to — recommend planning in advance, especially since other energy efficiency upgrades might be needed before making the switch.
Bear in mind that water heaters and clothes dryers are also available as heat pumps.
Finding a qualified contractor is also especially important when installing a heat pump since there are important questions about the home’s electrical system and the kind of heat pump needed. Michigan Saves lists contractors and offers financing for heat pumps, other appliances and energy efficiency upgrades.