Discusses the development of a high-efficiency natural gas engine-driven heat pump for light commercial U.S. applications. Discusses basic principles of operation as well as design considerations. States that product goals achieved through environmental chamber testing include a 95degF ARI coefficient of performance (CoP) rating of 0.9 and a 47degF ARI CoP rating of 1.8. Discusses field test results, which confirm high seasonal operating efficiencies with heating CoPs ranging between 1.2 and 1.5 and cooling CoPs ranging from 0.89 to 1.1, depending on climate, application and thermostat set point. Maintains that this technology represents the next logical advance in space conditioning technology and offers benefits to the customer and gas and electric utilities.KEYWORDS: USA, testing, heating, cooling, heat pumps, gas engine heat pumps, commercial, coefficient of performance, air conditioning