A geothermal heat pump doesn`t create heat by burning fuel, like a furnace does. Instead, in winter it collects the Earth`s natural heat through a series of pipes, called a loop, installed below the surface of the ground or submersed in a pond or lake. Fluid circulates through the loop and carries the heat to the house. There, an electrically driven compressor and a heat exchanger concentrate the Earth`s energy and release it inside the home at a higher temperature. Ductwork distributes the heat to different rooms.
In summer, the process is reversed.