The adaptability of heat pump for space heating in extremely cold regions is a significant obstacle hindering the development of heat pump technology. This study proposed and analyzed an integrated heating solution combining a transcritical CO2 heat pump with borehole thermal energy storage (BTES) system. Firstly, a comprehensive system calculation model was established. Secondly, a novel borehole model was developed to match the characteristics of the transcritical CO2 heat pump. Finally, energy and exergy analyses were conducted to investigate the effects of variations in intermediate water temperature and borehole heat exchanger inlet temperature on system performance. The results indicated that there is an optimal heat extraction temperature at which the system's COP or exergy efficiency reaches its peak. Besides, as the borehole heat exchanger inlet temperature increases, the optimal heat extraction temperature rises accordingly, leading to enhancements in both COP and exergy efficiency.