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How does a heat pump work?

 Hot water heat pumps are efficient electric storage tank systems that extract heat from the ambient air and use it to heat the water tank. This technology has been around for more than 100 years, and is the same principle that works on reverse cycle air conditioners and fridges.
 
They can be either integrated (with the tank and compressor together in one unit) or split where the tank and compressor are separate.
 
Both types of units need to be installed in a well-ventilated area. They are usually installed outdoors but can be installed indoors if there is adequate space.