A heat pump comprises an indoor heat exchanger, an outdoor heat exchanger and a reversal valve which directs vapor phase refrigerant from a generator to the indoor heat exchanger during heating mode and to the outdoor heat exchanger during cooling mode. The reversal valve directs evaporated refrigerant to an absorber where it is absorbed by a strong solution supplied from the generator to generate absorption heat and a weak solution is pumped to the refrigerant generator. An indoor radiator and an outdoor radiator are connected in a closed loop water flow circuit during heating mode. A section of the water flow circuit passes through the absorber to extract heat therefrom to warm the indoor air by the indoor radiator. As a function of outdoor temperature, the water in the radiator is varied so that the temperature of the cooling water at the entry point of the absorber and hence the evaporation temperature is rendered variable so that the latter is automatically set at a point lower than the outdoor temperature to permit the outdoor heat exchanger to extract heat from the environment in a wide range of outdoor temperature variations. During cooling mode, the hot water from the absorber is routed to a second outdoor radiator bypassing the indoor radiator.