DIY Energy Audit, Part 2: Why Do Heat Pumps (sometimes) Cost a Fortune to Run?

After the first article, Matt collected his utility bills and other background information we need to get started. Here it is:

“Colonial 3,300 square feet. 3 adults one child. 2 Electric Heat Pumps: Large one in basement is Payne, Model Number PF1MNB048; Smaller one in mud room for rooms above garage has no name. Just has large number SA11694 and Model Number BCS2M18C00NA1P-1. Thermostat at 72 now and 70 in summer. Consumption Feb 2013 through Jan 2014 – kWh 5800, 4530, 2815, 1684, 1533, 2346, 1334, 1568, 1719, 3023, 5833, 7349”

I don’t even have to make a spreadsheet for this one!

What this tells us

We have a small-medium family in an average sized development home – no red-flags there.

However, the next items contain the keys to solving this mystery.

Heat pumps with electric backup heat + Cold weather = high electric bills

I’m reading between the lines a little based on past experience. Matt didn’t mention any other fuels being used, like gas or oil, so I’m assuming that the backup heat for the heat pump is electric. This is essentially  a giant toaster placed in the air handler to heat the air more when the heat pump alone cannot supply enough heat to satisfy the demands of the home. There are also “hybrid” heat pumps, that use gas or oil as the backup heat source but using these doesn’t increase your electric bill. Instead you see an increase in your other utilities. But for a “pure” electric home, this backup heat is electric.

Why do heat pumps need backup heat?

The most common question I get about heat pumps is “why don’t they make them large enough so you don’t need backup heat?”

There are several reasons for this, but let’s take a step back for a seconds and look a little more at heat pump technology.

Combustion furnaces (oil, gas, propane) are easy to understand. You make a fire that heats the air and a big fan blows this hot air around your house. Fire is really hot so the air gets hot and you feel comfy and warm. Most combustion systems put out much more heat than needed to maintain the temperature of your home in the dead of winter so they heat your home fast.

Heat pumps work somewhat mysteriously using a compressor and refrigerant. (Did you know that your refrigerator uses a small heat pump?) The properties of the refrigerant allow it to be compressed by the compressor (makes sense, right?) and then subsequently be de-compressed as it moves through the system. When the refrigerant is compressed, it gets hot and when it cools, by definition, it releases this heat. When you use a heat pump to heat your home (or cool your groceries), the refrigerant is constantly going through these transformations, using electrical and mechanical energy (the compressor) to heat the refrigerant and then releasing this heat somewhere else in the system. This is why it’s called a “heat pump” – it pumps heat from one place to another.

To complicate matters, the heat pump puts out less heat the colder it is out, just the opposite of what you want. The heat pump you have only puts out its rated heat when it’s about 48F outside! When it’s 30F, it might put out 75% (this is a random number, just meant for example purposes) and at 15F the output might be half of what it’s rated. But of course, as it gets colder, your home needs MORE heat for you to be comfortable. Argh!

Back to the question – why not make it big enough to heat your home?

Most home heat pumps use a compressor that runs at one speed – ON. Some have two speeds – HIGH and NOT AS HIGH. Only the most modern (and expensive) ones have compressors that run at a variety of speeds. For this discussion, we’re only talking about the single speed compressor that’s used in the vast majority of home heat pumps.

This still doesn’t answer the question. Why not make them “big enough”?

There are several answers:

  • Cost – the larger the compressor, the more it costs. It’s like putting a 400Hp engine in your care. Sure, you can do it if you want to go 0-6 in 4 seconds, but 99% of the time, you’re driving around town and 100 Hp is ample.
  • Efficiency – In the same way that the 400 Hp car engine  sucks down gas faster than the 100 Hp engine, the larger heat pump  is going to use energy much faster than a smaller one. Strictly speaking, if you need to run a much larger system, it can be designed to run efficiently, but the efficiency of a heat pump depends on how it runs as well as the size of the components like the unit that sits outside your home and inside the air handler.
  • Comfort – Your car has an accelerator but imagine if you could only floor it or let your foot entirely off the gas. That would be a really uncomfortable ride! That’s exactly how most heat pumps (and furnaces) work – it’s all or nothing. A heat pump that works well when it’s 5F outside will only run for a short time when it’s 35F. And remember, the heat pump puts out more heat the warmer it is out. So if it’s large enough at 5F, then it’s going to roast you in short blasts when it’s 40F and you just need a little heat.
  • Air conditioning and dehumidification – huh? What does your heat pump have to do with air conditioning? Everything. The heat pump IS your air conditioner, running in reverse. So instead of heat, it pumps cool into your home. In many climates, the winter is harder than the summer, so a system that is large enough in the winter would be way, way t0o large in the summer. This causes “short cycling” – that blast of cold air you get for five minutes then nothing for half an hour, then another blast. It makes for really poor air conditioning performance. Plus, in our climate, which is humid in the summer, the ability of the air conditioner to dehumidify the air is greatly reduced when operating this way, leading to an uncomfortable, clammy feeling home.

Enter backup heat

For all these reasons, heat pumps are usually sized conservatively, able to heat your home very efficiently down to, for example, 35F. This is why they are so popular from around the Carolinas and south – the winters just aren’t that harsh. But in colder climates, we might not see average temperatures of 35F for months at a time. So we need “backup heat”.

The simplest heat, as described earlier, is called “electric resistance heat” or “heat strips”. This is just a series of wires that heat up, exactly the same as an electric radiator or a toaster or a hair dryer. It converts electricity to heat very efficiently – essentially 100%. What’s wrong with that? In comparison, the heat pump, through the miracle of physics, operates from 200% to 400% efficiently. That is, for every Watt of power you pump in, you get 2 to 4 watts of useful heating for your home. Put another way, it costs 2x to 4x as much to heat with backup heat as it does with heat pump heat!

Most thermostats have a little blue light that goes on to tell you when the backup heat is on. This winter, that blue light has probably been burning steadily for the last month or two.

What can you do to reduce your electric bills?

Now that you understand why your winter electric bills are so high when heating with a heat pump in a cold climate, what can you do? I’m going to go from simplest and least expensive to more complex/expensive.

Turn down the temperature

The simplest approach is what Jimmy Carter called the “wear a sweater” approach to energy efficiency. Wear warmer clothes and turn down the thermostat so your system doesn’t have to run so hard. This is especially important in the coldest weather because your heat pump will never keep up with the heating demands. So, while your inclination might be to nudge the thermostat up when it gets colder, do so knowing that you’re going to pay for that comfort.

How much more? There are a lot of different formulae for this, but count on saving around 3% per degree F you lower your thermostat. In this particular case, Matt said he keeps his thermostat at around 72F. Lowering it to 68F would likely save around 10%-12% on the electric bill.

Use a programmable thermostat

In addition, you can go one step further and use a programmable thermostat, reducing the temperature when you’re not home and increasing it when you return. The trick is, when you increase the temperature, the heat pump might think it has to use that expensive backup heat to quickly raise the temperature. Modern thermostats and heat pumps have the smarts to avoid this, but the majority do not. Heat pump manufacturers recommend that you not raise the temperature more than 3F in order to prevent the backup heat from coming on. So if you’ve been turning the thermostat back to 60F when you leave and up to 70F when you get home, you’re very likely forcing your system to run expensively.

Change the backup heating setpoint for your system

Most systems are set by default to turn on the backup heat when it’s below 35F. Well, in our climate, that’s most of the winter! Some heat pumps allow a technician to alter this set point (most older ones do not). Reducing that from 35F to 30F can dramatically reduce heating bills because the backup heat runs less. There is a comfort tradeoff. Your heat pump might not be able to supply enough heat to keep your home comfortable with this reduced set point. But it doesn’t cost much (if anything) to try. This simple change can save you hundreds of dollars every winter, especially if you have a newer heat pump that probably has enough capacity to do this.

Reduce the amount of backup heat or use “staged” backup heat

Almost nobody talks about this but it’s relatively inexpensive and can work really well.

Here’s a secret – contractors hate call-backs and will do almost anything to avoid them. Generally, this is ok, but with heat pumps, it can cost you a fortune.

People call their HVAC contractor during the winter when their heat pump can’t keep up with the heating demand. Even though the system may be working fine, if it’s not putting out hot air, people think the system is failing. In order to avoid this call, contractors do two things: 1) they program the backup heat set point to a higher temperature than necessary (previous tip). 2) they install oversized backup electric heat strips so that the system can keep up with heating demands at the coldest possible temperatures.

But what happens when it’s 25F, and the heat pump is almost keeping up and just needs a little help? That same, huge backup heater comes on and drives up your electric bill. For most of the winter, that backup heater is 2x-4x larger than needed. I helped one friend reduce their backup heat from 20kW to 5kW and they said their home was still comfortable down to 5 degrees F outside!

Doing this requires an electrician or HVAC technician. Sometimes, the electric backup heat consists of several units, all wired together. You might have a 5kW and two 10kW strips, to make a 25kW heater. All they have to do is change the wiring so that only a fraction of the strips comes on when backup heat is called for. Some thermostats and heat pumps support “multi-stage” backup heating, so they can control the strips separately but most do not, so you have to your electrician Jerry-rig something. My personal preference is to have them simply disable one of the strips, reducing the capacity by about half. Then live with the system for a couple weeks and see how it feels. If it’s ok, then remove another  heat strip if possible.

Obviously, this is most cost effective if you have a friend who is an electrician and takes pity on you. Otherwise, it’ll cost you a couple hundred dollars for each experiment.

Another version of this is to simply have an electrician install high amperage disconnect switches on your heat pump so you can enable or disable the electric backup strips yourself as needed without worrying about getting electrocuted. This might cost a few hundred dollars but it can be extremely effective at reducing heat pump operational costs, especially in the milder months like December and March.

Improve the insulation / air sealing of your home

Now we’re getting into the realm of more complicated/expensive solutions.

By now, you see that heat pumps are very sensitive to the heating requirements of your home. This can be altered by turning down the thermostat and by improving insulation, usually starting in the attic because that’s the simplest/least expensive and can often yield the best payback.

My general rule is, if you have less than a foot of conventional insulation in your attic, you should add more. This helps you year round and can profoundly increase your comfort and reduce electric bills.

In general, before committing to altering the insulation in your home, it’s worth spending a few hundred dollars to get an energy auditor to come into your home and perform a blower door test and thermal imaging scan. This can save you thousands by helping you pinpoint the trouble-spots and prioritize repairs/improvements.

I’m going to stop here. This has been a ton of information and I’m sure you’re saturated by now. But for anybody with a heat pump, these tips should get you a long way towards diagnosing, if not solving, your high utility bills.


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