You might think of the add-on heat pump as an air conditioner that can operate in either direction. It consists of an inside and outside unit, each containing a coil.  The outside unit has a compressor.  Both coils are connected by tubing, and inside the tubing is liquid refrigerant, which has the ability to absorb and release heat. In the summer, warm air inside your home is absorbed by the refrigerant in the inside unit, which cools the air in the inside coil and then blows that cooled air into your home. The heat that is absorbed by the refrigerant is carried to the outside unit, where it is condensed and the resulting heat is blown out as hot air.  This is just the same as a high-efficiency central air conditioner.

In the winter, available heat is extracted from outdoor air and absorbed by refrigerant in the coil in the outside unit.  The refrigerant is compressed into vapor, which raises the temperature to provide heat. The heated refrigerant is then pumped inside, where the vapor condenses, releasing heat, which is distributed throughout your home by your furnace fan.  The refrigerant is then pumped back through the outside unit to restart the process. Because a heat pump moved heat instead of creating heat, it achieves energy-efficiency rating of 250 percent to 370 percent, depending on the outdoor temperature.  By comparison, gas furnaces-which create heat-range in the efficiency from 60 percent to 92 percent.