GEO THERMAL SYSTEMS
HOW DOES A GEOTHERMAL SYSTEM WORK?
After a geothermal system is installed, the heat pump, usually located in the garage or basement, circulates liquid through pipes 300 feet deep into the ground. These are sometimes referred to as “loops” and they absorb the temperature that is distributed into the ground from the sun. The liquid in the loops circulates back up to the geothermal heat pump which heats or cools your home. In the winter, the heat from the liquid is extracted and distributed around the home. In the summer, heat is taken from the home into the liquid which carries it into the ground to cool.
Because of how a geothermal heating and cooling system works, it doesn’t require fossil fuels or a lot of electricity, it is environmentally friendly. In fact, it’s recognized by the United States Environmental Protection Agency (EPA) as a clean, renewable source of energy that is greatly underutilized.
The following infographic helps clarify how a geothermal system works.
How Much Does a Geothermal Heat Pump Cost?
The biggest downside to installing a geothermal heat pump is the cost. The system and installation can range from $10,000 to $40,000 depending on your soil conditions, plot size, system configuration, site accessibility and the amount of digging and drilling required.
For a typical 2,000-sq.-ft. home, a geothermal retrofit can cost up to $30,000. The system may require ductwork modifications along with extensive excavation. In a new home, installation costs would be on the lower end. Even so, a geothermal system will cost about 40 percent more than a traditional HVAC system.
Recouping these costs through energy savings could take as little as four years or as long as 15 years depending on utility rates and the cost of installation. It takes some homework and professional estimates to figure out whether a geothermal system makes financial sense in your situation.
Tax Incentives and Rebates for Installing a Heat Pump
You can save some money on a geothermal heat pump system through tax credits. The Inflation Reduction Act of 2022 included a tax credit that can be worth as much as 30 percent of the cost for residential installations (and 30 percent for commercial buildings as well) for Energy Star qualified systems. Those tax rebates are available through 2032.
There may be additional rebates available from your utility company as well as state and local governments, as well as incentives based on household income, so check with those entities if you’re considering installing a heat pump in a new home or retrofitting an existing house with one.
What Are the Benefits of a Geothermal Heat Pump?
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Much lower operating costs than other systems. A geothermal heat pump will immediately save you 30 to 60 percent on your heating and 20 to 50 percent on your cooling costs over conventional heating and cooling systems.
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Uses clean, renewable energy (the sun). With a geothermal heat pump, there’s no onsite combustion and therefore no emissions of carbon dioxide, carbon monoxide or other greenhouse gases. Nor are there any combustion-related safety or air quality issues inside the house. (The pump unit does use electricity, which may be generated using fossil fuels.)
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Can be installed in new construction and retrofit situations. However, it’s a lot more expensive in retrofits requiring ductwork modifications.
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Much quieter than other cooling systems. There’s no noisy outdoor compressor or fan. The indoor unit is generally as loud as a refrigerator.
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Low maintenance and long-lived. The indoor components typically last about 25 years (compared with 15 years or less for a furnace or conventional AC unit) and more than 50 years for the ground loop. The system has fewer moving parts and is protected from outdoor elements, so it requires minimal maintenance.
What Are the Downsides of a Geothermal Heat Pump?
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Not a DIY project. Sizing, design and installation require pro expertise for the most efficient system.
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Still relatively new. That means fewer installers and less competition. which is why prices remain high.
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Installation is highly disruptive to the landscape. It may not even be possible on some lots. Heavy drilling or digging equipment will definitely crush your prize petunias.
Is Geothermal Right for You?
About 100,000 geothermal cooling and heat pumps are installed in the United States each year. According to Bob Donley, customer support manager at GeoSystems LLC in Minnesota, interest in geothermal HVAC is really on the rise.
A few factors to consider that could make your home a fit for a geothermal HVAC system:
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Can stomach the upfront costs and plan to stay in your house for at least four to seven years (new construction) or 10 to 12 years (retrofit) to recoup initial costs through energy/cost savings.
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Live on a large lot with a pond or a well. This would allow you to use a less expensive loop system (see Figure D).
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Are building a new house and can roll the upfront costs right into the mortgage. You’ll be saving on heating and cooling costs on day one.
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Have an existing house with high energy bills. This most likely means you currently use propane, oil or electricity for heating and geothermal cooling.
