Short answer
When your central air conditioner needs replacing, a heat pump usually costs only somewhat more because it is the same equipment with a reversing valve and controls added. It cools just like an AC and also heats your home for much of the winter, which can lower your heating bill depending on your fuel and province.
Key takeaways
- A heat pump is an air conditioner that can also run in reverse to heat.
- The price gap over a new central AC is usually modest, and rebates can close it.
- SEER2 measures cooling efficiency, HSPF2 measures heating efficiency.
- With a gas furnace, a heat pump plus furnace becomes a hybrid dual-fuel system.
- Ask for a cold-climate model if you want it to heat through most of the winter.
Central AC vs heat pump: if your air conditioner is near the end of its life, this is the cheapest time to switch. A heat pump uses the same outdoor unit, refrigerant lines and indoor coil as a central AC, with a reversing valve and controls that let it also heat. The price gap over a comparable AC is usually modest.
In summer it cools your home exactly like an air conditioner. In winter it heats your home for some or most of the season, depending on the model and your climate. If you have a gas furnace, the furnace stays as backup.
How a heat pump differs from a central AC
An air conditioner pulls heat out of your home and dumps it outside. A heat pump does the same in summer. In winter it reverses and pulls heat from outdoor air into your home. Both are the same basic machine.
| Feature | Central AC | Heat pump |
|---|---|---|
| Cools in summer | Yes | Yes |
| Heats in winter | No | Yes |
| Outdoor unit and coil | Yes | Yes, plus reversing valve |
| Typical price vs a comparable AC | Baseline | Somewhat higher, often offset by rebates |
| Rebate eligibility | Rarely | Often, if cold-climate rated |
| Effect on heating bill | None | Lower in most cases with oil, propane or electric heat; depends on province with gas |
SEER2 and HSPF2 basics
You will see two efficiency ratings on spec sheets. Both are seasonal averages under standard test conditions.
SEER2: cooling efficiency
SEER2 is the Seasonal Energy Efficiency Ratio, updated with tougher test conditions in 2023. Higher is better. Most new units sit in the mid teens to low twenties. In much of Canada summers are short, so moving from a mid-range to a top-tier SEER2 saves less on cooling than it would in a hot climate. See summer cooling costs for what cooling really costs.
HSPF2: heating efficiency
HSPF2 is the Heating Seasonal Performance Factor. Higher is better. It is tested in a moderate climate, so it overstates performance in a Canadian winter. For Canada, look more closely at the cold-climate specs:
- Heating capacity at -15 °C and -25 °C.
- COP at those temperatures.
- The lowest temperature the unit keeps running.
Cold-climate models typically average a seasonal COP of 2.2 to 3.0 in Canadian conditions and many keep heating to about -25 to -30 °C. Read is a heat pump worth it in a Canadian winter for more.
What it means for your heating bill
How much you save depends on what heats your home today.
- Oil, propane or electric baseboards: savings are usually substantial.
- Natural gas in BC, Quebec, New Brunswick or Nova Scotia: the heat pump is typically cheaper to run than gas through much of the winter.
- Natural gas in Ontario or Manitoba: the heat pump is typically cheaper in mild weather, and the furnace in deep cold. Set the switchover to suit.
- Natural gas in Alberta or Saskatchewan: gas is usually cheaper to run at current prices. You still get the cooling you were paying for anyway, plus lower emissions if you run the heat pump in mild weather.
Our heat pump vs gas furnace guide shows the cost per unit of heat in each province.
Pairing with your existing furnace
If you have a gas furnace in good shape, the new heat pump coil goes on top of it, just like an AC coil. A compatible thermostat decides when to use each. That setup is called hybrid or dual-fuel heating. Our hybrid heating guide explains how to choose the switchover temperature.
Is a heat pump ever not worth it over an AC?
- If your budget is very tight and your rebate options are limited, a basic AC is the lowest upfront cost.
- If your ducts or electrical panel need major work for the heat pump, the gap grows.
- If you only want cooling in Alberta or Saskatchewan and plan to always heat with gas, the heat pump's heating ability may rarely pay you back.
Next steps
Check current offers on our rebates page. Ontario's Home Renovation Savings Program offers up to $7,500 for a cold-climate air-source heat pump. Then estimate your savings in the heat pump calculator and ask installers to quote both an AC and a heat pump so you can compare.
Frequently asked questions
Should I replace my AC with a heat pump in Canada?
Usually yes, if your AC is near the end of its life. A heat pump costs somewhat more, cools the same way and also heats your home, and rebates often close the gap.
What is a good SEER2 rating in Canada?
Most new units sit in the mid teens to low twenties. Because Canadian summers are short, a mid-range SEER2 is often enough, and cold-weather heating specs matter more.
What does HSPF2 mean on a heat pump?
HSPF2 measures seasonal heating efficiency under standard test conditions. It is tested in a moderate climate, so in Canada also check the unit's capacity and COP at -15 °C and -25 °C.
Can a heat pump work with my gas furnace?
Yes. The heat pump coil sits on the furnace and a compatible thermostat switches between them, which is called a hybrid or dual-fuel system.
Want numbers for your own home?
Use the heat pump vs. furnace with your province's prices and climate. It takes about two minutes.