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Air Conditioner, Heat Pump, Furnace & Air Handler: What’s the Difference?

Confused by all the different HVAC options available? Are you not sure what the difference is between an air conditioner and heat pump, or a furnace and an air handler? Time to change that. We walk through the differences of each, and compare the costs and benefits for homes.

Air Conditioner, Heat Pump, Furnace & Air Handler: What’s the Difference?

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Matt Reed


Matt Reed


July 13th, 2020

If you’re getting ready to replace your HVAC equipment, you’re probably researching your options. Unbeknownst to many homeowners, there are a massive number of choices available for HVAC equipment. This can understandably be confusing and overwhelming.

We’re here to make things easy.

You want efficient heating and cooling for your home, right? Depending on your situation, the best solution for you can be very different from someone in another state, city, or even the family next door. Navigating your options to choose the best one is crucial.

This article breaks equipment down into four primary categories: air conditioners, heat pumps, furnaces, and air handlers. There are some sub-categories we’ll discuss, but every full HVAC system will include some combination of these pieces of equipment.

We’re going to explain the differences between each, as well as some pros and cons to each. By the end, you’ll know which is which, and also why those differences matter.

Why the Differences Matter

If it heats, it heats, and if it cools, it cools...right?!

Well, sort of. The different technology underlying different types of equipment can make a difference for you. The potential advantages fall into two main categories:

  1. Efficiency - Some systems will operate more efficiently than others, providing you better comfort. Importantly, the most efficient system for one home might not be the best for another. This can be due to where you live, but also what other HVAC equipment you have, since many A/C units, heat pumps, furnaces, and air handlers are designed to work better together.
  2. Cost - There are initial cost differences to different equipment types, and also differences in your energy bills if the equipment is properly functioning in tandem. Cost can also increase if you’re switching equipment types (electric to gas furnace, for example), since your home may need new lines to properly fuel the system.

There are often other considerations, but they’ll be particular to a home’s needs. Next, let’s look at some specific differences between equipment types.

Difference Between an Air Conditioner and a Heat Pump

The short answer is that air conditioners only cool, but heat pumps can both heat and cool. Both absorb and transfer heat. Heat pumps simply have a reverse setting, where they absorb heat from outside and transfer it inside.

Adding to some homeowners’ confusion is that an A/C unit and a heat pump look identical from the outside. Without knowing the model or seeing the inner workings, there’s often no way to tell the difference between the two.

So if it both heats and cools, why wouldn’t you always want a heat pump? Two main reasons:

  1. The initial cost of a heat pump is going to be higher than a comparable air conditioner.
  2. The efficiency of a heat pump’s heating is going to suffer in colder climates. Here in Columbus, OH, for example, pairing it with an electric furnace is basically a necessity.

That’s not to say heat pumps aren’t good solutions. When paired properly, they can provide extremely efficient cooling and heating. But the context matters.

How Air Conditioners and Heat Pumps Work

The technology of air conditioners and heat pumps works similarly. To cool, heat is absorbed by the indoor evaporator cool and transferred to the outdoor unit, where it is emitted. The pressure of the refrigerant in the system, which varies depending on whether it’s inside or out, is what facilitates the absorption and emission.

Heat pumps simply manage refrigerant pressure differently when heating a home, so that heat is absorbed outside, then transferred inside.

It’s a myth that air conditioners and heat pumps “cool the air.” This is what it feels like if you put your hand over a vent when the air conditioner is running. But the technical process is more about heat transfer than it is about cooling the air.

Types of Heat Pump

Now that we understand how heat pumps work, and what the differences are between them and air conditioners, let’s look at a couple of types of them.

Air-Source Heat Pumps

This is the type that you’ll be most familiar with, and that you’ll see in the vast majority of heat pump homes. It absorbs heat from the surrounding air to pump into or out of the home.

Geothermal Heat Pumps

The underlying technology of a geothermal heat pump is the same as an air-source heat pump, but the source of the heat is different. These units generally sit in a basement and absorb ambient heat from the ground itself. This might sound far-fetched, but utilizing geothermal energy for heating and cooling is an ancient practice that predates modern HVAC equipment by thousands of years. These systems, though, are more rarely seen in homes compared to air-source units and traditional air conditioners.

Difference Between a Heat Pump and a Furnace

Much like an air conditioner only cools, a furnace only heats, while a heat pump can both heat and cool. Additionally, heat pumps work by absorbing heat either from the home or from the outside and transferring it to the opposite location. Furnaces generate heat in and of themselves, traditionally through gas or electric power.

Heat pumps are commonly paired with electric furnaces due to the overlap in technology. A heat pump will provide some heating benefit, which is supplemented by the furnace's heat. By working in tandem at varying levels depending on the temperature setting, the two can provide very efficient heating for a home.

As we discuss below, the different types of furnaces can change things up. Depending on what type you have, the best combination for you can change.


Type of Furnaces

The type of furnace you have matters, and can dictate whether you should be pairing it with an air conditioner or heat pump.

Gas Furnaces

Probably the most common and cost-efficient due to the low cost of natural gas, gas furnaces nevertheless need to have a gas line run into the home to fuel the system. If your existing or previous system wasn’t gas-based, this can represent an additional parts and labor cost.

Gas companies will generally only run a gas line to the meter outside your home. An HVAC contractor then has to run the gas line from the meter to your furnace. Depending on the distance between the two, this can be a significant job in terms of both time and money.

Electric Furnaces

We’ll talk a little bit more about these in the air handler comparison below, but electric furnaces are the main alternative to gas-based systems. They use electric power to generate heat. In instances where you’re pairing with a heat pump, or where lack of accessibility to a gas line is an issue, they can be a viable option.

Oil Furnaces

These are still in many older homes, and represent an alternative from a time when gas furnaces were much more cost-prohibitive. While they can still work in tandem with a modern cooling system, they tend to be dirtier, worse for the environment, and less efficient than many modern systems. This is compounded by the need for frequent maintenance visits due to the volatility of the oil, which can easily become contaminated and harm the system.

While any heating and cooling decision should be made by the homeowner, we often recommend options for a replacement that will provide myriad long-term benefits compared to oil furnaces.

RELATED: How Much Does a Furnace Cost? A Comprehensive Breakdown

Difference Between a Furnace and an Air Handler

So wait, if an air conditioner cools, and a furnace heats, you’re set, right? Not quite. An air handler is a part of any ducted HVAC system. Simply put, it is what moves the air throughout the system and your home.

Sometimes what someone will refer to as your furnace is, in fact, an air handler with separate electric furnace components installed with it. Functionally speaking, you don’t always need to know the difference, but a furnace or air conditioner without an air handler will not circulate air properly to heat or cool your home.

It’s entirely possible, for example, to have just an air conditioner paired with an air handler. You might see this in very warm climates, or in, say, a finished attic or third story that stays warm enough in the winter but struggles to stay cool in the summer with the existing cooling system that’s working from the basement.

The only HVAC systems that lack an air handler are ductless mini-split systems. These ductless systems are becoming much more common in situations like the attic example above, where you need a cooling and/or heating option for a small space.

RELATED: Ductless Mini-Splits vs. Central Air: Pros and Cons

That said, ductless HVAC systems are generally not as well-equipped for whole-home solutions, especially when your home already has ductwork for a central air system. In these instances, you’ll always have an air handler to move the air throughout that ductwork.

Air conditioner, furnace, and accessories.

What’s the Best HVAC System Combination?

Hopefully, by now our answer won’t surprise you: it depends.

But rather than let that ambiguity be a frustration, we also hope that you realize that there are “best” options for many homes depending on your existing setup, as well as your long-term heating and cooling needs.

To state it bluntly, the low cost of gas makes an air conditioner + gas furnace systems the best choice for the majority of customers we work with here in Columbus, Ohio. However, we still see homes where that solution won’t work, and it’s going to save the homeowner money both short-term and long-term to go with an electric system.

If the cost of gas changes, as it has in the past, that rule could change.

It can also change depending on where you live. In the southern United States, for example, electric systems are much more popular due to the lower need for high-powered heating. You’ll find many more heat pumps there.

Want to learn more about the HVAC industry? Check out our comprehensive Learning Center, where we demystify any topic on your mind.

And if you’re ready to make the switch to a new system type, or simply upgrade your existing system, check our service area below to start your journey!

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