An air-source unit usually sits outside your building & contains an electrically powered refrigeration
mechanism with a finned heat exchanger and a large fan. The heat (extracted from the outside air) is usually transferred to water that is piped to inside the house.

Air may not seem like the ideal source of heat since when the heating demand is highest, the air is at its coldest. However, the majority of days over the year are somewhere between €˜mild€™ and €˜chilly, where air-source efficiency is reasonably good. Air source systems have been improved over recent years, so the efficiency difference between ground source and air source may have closed. Recent real-life studies in Germany suggest that Air Source systems are on average 20worse than Ground source, but it should be noted that there are many factors that affect the overall energy
efficiency of the system.

At outside air temperatures below around 6 or 7°C, ice will tend to form on the heat exchanger. This blocks
the air passages and reduces the efficiency. A mechanism is deployed that reverses the system to melt the ice. This process is not as wasteful as maybe first thought, but it still contributes to a reduction in energy efficiency (in the region of 10). The key to energy efficient defrosting is a well-engineered sensing mechanism. In general terms the most sophisticated and energy efficient methods are usually fitted to more expensive heat pumps.

A back-up heater in the form of a conventional electric heating element is sometimes included within the heat pump package. This is far more necessary for air source, than ground source systems, and usually controlled automatically. It is important to ensure that this expensive-to-run heater is not used too much. Boiler-fired back-up systems are possible, but far less common in the UK than they are in Germany. An air source system operating along side an existing oil boiler, or together with wood burning stoves may be a viable option. This avoids excess use of electricity during the coldest spells.