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This paper presents a new model to simulate energy performance of variable refrigerant flow (VRF) systems in heat pump operation mode (either cooling or heating is provided but not simultaneously). The main improvement of the new model is the introduction of the evaporating and condensing temperature in the indoor and outdoor unit capacity modifier functions. The independent variables in the capacity modifier functions of the existing VRF model in EnergyPlus are mainly room wet-bulb temperature and outdoor dry-bulb temperature in cooling mode and room dry-bulb temperature and outdoor wet-bulb temperature in heating mode. The new approach allows compliance with different specifications of each indoor unit so that the modeling accuracy is improved. The new VRF model was implemented in a custom version of EnergyPlus 7.2. This paper first describes the algorithm for the new VRF model, which is then used to simulate the energy performance of a VRF system in a Prototype House in California that complies with the requirements of Title 24 – the California Building Energy Efficiency Standards. The VRF system performance is then compared with three other types of HVAC systems: the Title 24-2005 Baseline system, the traditional High Efficiency system, and the EnergyStar Heat Pump system in three typical California climates: Sunnyvale, Pasadena and Fresno. Calculated energy savings from the VRF systems are significant. The HVAC site energy savings range from 51 to 85%, while the TDV (Time Dependent Valuation) energy savings range from 31 to 66% compared to the Title 24 Baseline Systems across the three climates. The largest energy savings are in Fresno climate followed by Sunnyvale and Pasadena. The paper discusses various characteristics of the VRF systems contributing to the energy savings. It should be noted that these savings are calculated using the Title 24 prototype House D under standard operating conditions. Actual performance of the VRF systems for real houses under real operating conditions will vary.