geothermal source heat pumps work by extracting heat from pipes laid in the ground outside your home. Using the heat extracted from the ground, the mixture of water and anti-freeze in your piping is then pumped through the loop to a heat compressor which concentrates it to a higher, more useful heat for use in the heating and hot water circuits. The grond loop fluid is then passed back to the loop pipes to extract more heat and repeat the process.

The temperature below of the surface of the ground stays fairly constant, regardless of the temperature outside, so a ground source heat pump can maintain high levels of efficiency.