A model of space heating and cooling system, in which a surface water pond with an insulating cover serves as the heat source in the winter and heat sink in the summer, is presented. Based on the heat load of the building, the vapor compression heat pump cycle and the seasonal energy storage of the water pond, the performance of the system is obtained. The total compressor work year round, as well as the coefficient of performance (COP) of heat supply in the winter and refrigeration in the summer, is investigated in order to give a full review of the proposed model. The design parameters, including the thickness of the insulating cover and the volume of the pond water and the type of soil are analyzed. The results show that the proposed system can run well for various soil types, provided the thickness of the insulating cover is properly designed. To analyze the interaction of the seasonal heat charge and discharge, three running modes are discussed. The proposed mode can save about 16% compressor work, compared with the modes which run for heat supply and refrigeration individually. (c) 2006 Elsevier Ltd. All rights reserved.