Nelson Mechanical Design (NMD) has been installing the Daikin "mini-split" ductless heat pumps since 2004 but we have noticed that their popularity has greatly increased in the last several years. While the technology they use has been successfully used in Europe and Japan for the last decade, these heating and cooling machines are just beginning to take off here in the U.S.
First some explanation of the terminology - a "mini-split" is a heating and cooling system that is divided into an outside unit (typically called the "heat pump") and an inside unit (the fan coil that moves, heats, cools, and dries air in the room) - hence the "split".
It is "mini" because these units are available in room-sized increments - a single small mini-split can heat or cool a single room while a larger one can heat or cool an entire floor. Because these systems are smaller that the typical American whole-house AC systems, they are called "mini".
The "ductless" term refers to the configuration of the inside unit - it has a fan that moves room air over a coil but there is no duct work - the inside unit is mounted on the wall close to the ceiling. This means that each room can have one of these units resulting in amazing individualized control room by room.
The "heat pump" part refers to the idea of using refrigerant - in this case ozone-friendly R410 - to move heat either into the building in the winter or out of the building in the summer. Amazingly enough, in the winter the outside unit gets cold enough that it can pull heat out of the outside air (even down to 5F outside!) and use this energy to heat air to 110 F - resulting in very comfortable winter heating.
These units are so popular because they are extremely efficient (the same as geothermal - about half the cost of propane to run throughout the year) - which is why they are used in all of the "passive houses" and the most energy efficient buildings being constructed today - and very affordable - a system can be bought one room at a time making it very easy to expand to include other rooms in a home.
Daikin makes the air source heat pumps that NMD installs - they are very well made units that are highly efficient.