A heat pump is a device that transfers heat energy from a source of heat to a destination called a "heat sink". Heat pumps are designed to move thermal energy in the opposite direction of spontaneous heat transfer by absorbing heat from a cold space and releasing it to a warmer one. A heat pump uses a small amount of external power to accomplish the work of transferring energy from the heat source to the heat sink.

While air conditioners and freezers are familiar examples of heat pumps, the term "heat pump" is more general and applies to many HVAC (heating, ventilating, and air conditioning) devices used for space heating or space cooling. When a heat pump is used for heating, it employs the same basic refrigeration-type cycle used by an air conditioner or a refrigerator, but in the opposite direction - releasing heat into the conditioned space rather than the surrounding environment. In this use, heat pumps generally draw heat from the cooler external air or from the ground.

A chiller is a machine that removes heat from a liquid via a vapor-compression or absorption refrigeration cycle. This liquid can then be circulated through a heat exchanger to cool equipment, or another process stream (such as air or process water). As a necessary by product, refrigeration creates waste heat that must be exhausted to ambience, or for greater efficiency, recovered for heating purposes.

Chilled water is used to cool and dehumidify air in mid- to large-size commercial, industrial, and institutional facilities. Water chillers can be water-cooled, air-cooled, or evaporatively cooled. Water-cooled systems can provide efficiency and environmental impact advantages over air-cooled systems

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