Heat pumps have become central to Vermont’s climate policy, with substantial state and federal incentives encouraging homeowners to switch from fossil fuel heating. Supporters argue that modern systems can handle northern winters efficiently, while critics point to cost, reliability, and performance limits in extreme cold.

So what do the available reliability surveys and real-world performance numbers actually show about heat pumps in cold climates like Vermont?

Reliability: The Consumer Reports Data

One of the most detailed consumer reliability datasets comes from Consumer Reports. According to Consumer Reports’ latest analysis, based on surveys of members who installed 13,753 heat pump systems between 2009 and 2025, 29% of heat pumps broke or stopped working by the end of the eighth year of ownership.

That figure is notable because it represents roughly the midpoint of the typical expected lifespan of a heat pump system. Consumer Reports describes heat pumps as “one of the least reliable products we have ratings for,” though the organization also notes that reliability varies by manufacturer. Several brands received strong marks, with five rated exceptional.

The survey data suggests that homeowners considering a heat pump should treat long-term maintenance and repair risk as part of the overall cost equation, especially compared with more established heating technologies.

Consumer Reports also repeatedly emphasizes that installation quality plays an outsized role in whether systems perform well over time. The organization’s heat pump buying guide notes: “The margin for error with heat pumps is smaller than with traditional heating systems, making proper sizing essential.”

In other words, reliability is not only a question of the equipment itself, but also of contractor skill, design, and correct matching of the system to the home.

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Cold Climate Performance

A longstanding concern is that heat pumps lose efficiency as temperatures drop. Standard air-source heat pumps extract heat from outdoor air, and the colder the air becomes, the harder the system must work.

According to EnergySage, traditional electric heat pumps typically start to lose efficiency at or below 35°F. This is one reason early generations of heat pumps were often viewed as poorly suited for northern climates.

However, newer “cold-climate” heat pump models have improved substantially. The U.S. Department of Energy’s Cold-Climate Heat Pump Technology Challenge, which ran from 2021 through 2023, found that some advanced systems maintained efficiency ratings at temperatures as low as -15°F.

Manufacturers have made similar claims. Carrier’s technical specifications state their cold climate models can operate “efficiently down to -22°F, maintaining reliable performance without a loss of heating power.” Trane reports that a prototype unit performed in DOE testing at temperatures as low as -23°F.

Independent organizations generally agree that cold-climate heat pumps can function well below zero, but often recommend backup systems for the coldest days. The Center for Energy and Environment in Minnesota notes that cold-climate air source heat pumps can work in temperatures down to -13°F, but advises having a secondary heating option for days colder than that threshold.

The performance takeaway is that modern heat pumps can provide usable heating in Vermont winters, but extreme cold remains a boundary condition where auxiliary heat may still be necessary.

The Cost Question

Whether heat pumps save money compared to natural gas depends heavily on local energy prices. Heat pumps are generally more efficient than electric resistance heating, and often cheaper to operate than oil or propane, but the comparison with gas is less consistent.

The American Gas Association reports that “the natural gas home saves an average of $390 per year compared to an electric home with a cold climate heat pump.” Their analysis evaluated typical new home energy needs for space heating, water heating, cooking, and drying.

Heat pump advocates point to different findings. A 2024 study by the National Renewable Energy Laboratory found homeowners saw median annual savings of $300 to $650 by switching to a heat pump from electric, fuel oil, or propane heating sources.

Rewiring America’s analysis acknowledges the complexity, stating: “Because of current prices, switching to a heat pump from natural gas doesn’t save much on average.”

Regional variation is significant. PickHVAC’s calculator found that in Pennsylvania, a natural gas furnace costs approximately $500 less annually to operate than a heat pump, while in Arizona, heat pumps show slight savings.

EnergySage summarizes the key ratio: EnergySage summarizes that “For a heat pump to win on operating costs, the price per kWh of electricity needs to be 10% or less of the price per therm of gas.”

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Vermont Incentives

Vermont offers substantial incentives to offset installation costs. According to the Vermont Department of Public Service, eligible moderate-income households can receive rebates covering up to 50% of heat pump costs, up to $8,000 per household, through the federal Inflation Reduction Act.

Green Mountain Power offers a $2,000 rebate for income-eligible customers at or below 80% of area median income. Efficiency Vermont provides $375 to $475 instant discounts on qualifying models, with additional bonuses ranging from $200 to $2,200 depending on utility and income level.

Even with incentives, upfront costs remain significant. The NREL study cited by EnergySage found whole-home heat pump installations averaged approximately $19,000 in 2025, or roughly $16,500 after factoring in state and local incentives.

The Bottom Line

Heat pump technology has improved substantially for cold-climate applications. Modern cold-climate models can operate effectively at temperatures well below zero, addressing longstanding concerns about performance in northern states like Vermont.

However, reliability data suggests meaningful repair risk over time, with nearly one in three units reporting failures or shutdowns by year eight. Proper sizing and professional installation remain critical.

Whether heat pumps save money depends heavily on local electricity-to-gas price ratios and the type of heating system being replaced. For Vermonters currently heating with oil or propane, the economics often favor heat pumps. For those with access to natural gas, the savings case is less clear.

The combination of high upfront cost, variable operating economics, and reliability concerns suggests homeowners should evaluate their specific circumstances carefully before making the switch.

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Dave Soulia | FYIVT

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