- Ductless heating and cooling systems been growing in popularity over the last few years.
- Ductless heat pumps are cost-effective, energy-efficient, and more compact alternatives to traditional HVAC system.
- If you act now, you can get a 26 percent tax credit when installing a geothermal heat pump.
If you are looking to install ductless heating and cooling in your home, you’re not alone. These systems have been growing in popularity over the last few years — and for good reason. Ductless heating and cooling systems are incredibly versatile, plus they offer many benefits to both homeowners and renters alike.
While ductless air conditioning is a great addition to any home, there are some things homeowners should be aware of making such a big purchase. You can find out all this information with a simple online search.
To help get you thinking on what to search, here is everything you need to know about ductless heating and cooling.
What Is a Ductless Heat Pump?
A ductless heat pump, also know as a mini-split pump, is a system that provides heating and cooling in a home without using ductwork. In many cases, they can be cost-effective and more compact alternatives to traditional HVAC systems.1
In addition to indoor comfort, ductless heat pumps are highly energy efficient. In fact, homeowners can save up to 30 percent on heating and cooling costs by using a ductless system. Those are saving that can easily add up over time and offset the price of installation.2
How Do Ductless Heat Pumps Work?
A ductless heat pump uses a compressor and condenser to move warm or cool air from a remote location and into your home. They do this by following these steps:
- The system pulls in outside air.
- The air is filtered by the compressor.
- Air is compressed and pressurized before passing to the condenser.
- The condenser extracts the heat.
- The heat is ejected back outside, while the cool air is pumped into the home.
This process is reversed in winter. As such, the cold air is extracted, while the heat is pumped into your home.3
Heat Pump Costs
While ductless heat pumps are less expensive than your regular HVAC unit, they do still cost a pretty penny. In total, the cost of a ductless heat pump can range from $1,800 to $7,542. In addition to costing less than a HVAC unit, there are many options available so you can choose exactly what you need, as opposed to buying a pre-packaged solution.
Although ductless heat pumps require minimal work to install, expect to pay anywhere from $68 to $150 for labor. As such, be sure to shop around and compare estimates. Doing so will help you stay within budget.4
Buying Options for Heat Pumps
While we have exclusively discussed ductless heat pumps, it is only one type of heat pump. There are multiple types of heat pumps, each varying in price for the unit and the cost of installation.
According to This Old House, the pricing for the unit and installation for each type is as follows:
- Air-Source Heat Pump: The price of the unit ranges from $2,000 to $5,500 with installation costing $1,300 to $2,000.
- Geothermal Heat Pump: The price of the unit ranges from $3,000 to $6,000 with installation costing $10,000 to $30,000.
- Ductless Mini-Split: The price of the unit ranges from $1,000 to $3,500 with installation costing $500 to $3,500.
- Gas-Fired Heat Pump: The price of the unit ranges from $3,000 to $6,000 with installation costing $1,300 to $2,000.5
Tax Credits for Heat Pump Installation
There are plenty of tax credits you can get for installing a heat pump. However, most of those credits vary by state. As such, it is best to do an online search to determine which tax credits are available where you live.
Fortunately, there is one tax credit that is available on a federal level. Through 2023, the government is offering a tax credit on geothermal heat pump installations. Homeowners will receive a 26 percent tax credit if they install a unit before the end of 2022 or 22 percent tax credit if installed before the end of 2023. Better yet, this tax credit can be:
- Used to offset alternative minimum tax;
- Combined with solar and wind tax credits and energy efficiency upgrade credits, and;
- Redeemed in more than one year.
If you want to maximize what you receive from this tax credit, make sure to act now. Especially before the incentive is lowered to 22 percent.6
How Much Could Switching to Ductless Heating and Cooling Save You?
This is, of course, dependent on your current heating system. But no matter how you heat and cool your home, there are some savings to be had.
If you’re looking to switch from baseboard heaters, you could end up saving on average $1,287 a year by switching to ductless heating. Even at the lower end of savings, switching from an electric furnace can save you around $815 a year.
Both fuel oil and propane can be expensive to heat a home with but switching to ductless heating could save you around $950 and $855 a year respectively.7