A heat pump is a device that absorbs heat from the air, ground or water around a building. It is part of a home heating and cooling system and is installed outside your home. Heat pumps can cool your home like an air conditioner, but they are also capable of providing heat. Heat pumps use electricity to extract heat from the ground, air or even water. They can be used to create warm air or water for space and central heating, as well as hot water for both central heating and domestic hot water supply.