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A heat pump looks and functions like an air conditioner in the summer and removes the heat from your home to the outside. It has one major difference in the winter. It reverses the cycle and takes any heat from the outdoors and brings it into the home. Heating your home with a heat pump is more cost effective than any gas furnace; however a heat pump cannot keep up when the outside temperature gets below 32, so a gas or electric furnace will be needed to supplement the heat pump. Many local utility companies also offer rebates for installing a heat pump in your home.