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lizt06

Up front costs of Geothermal heat pump vs. other heating methods

lizt06
18 years ago

We are planning to build a new home near Annapolis, MD. I am just starting to investigate geothermal heat pump systems. It has been mentioned quite a few times that up front costs are more - how much more (in percentages or costs)? The house will be around 4000 sq.ft. with 2800 on first floor and 1200 on the second floor. We will have an unfinished basement that may get finished in the future (but not for quite a few years). I am just trying to get a feel for the difference between a geothermal system and a heat pump with oil backup system - there is no natural gas. We have plenty of land. Also - are there restrictions with regard to septic systems and wells?

Thanks for any input!

Liz

Comments (79)

  • mepop
    18 years ago
    last modified: 9 years ago

    I need to add some additional view points to java_man thats not being considered. Take his 25,000.00 additional investment in geothermal and treat it as a true investment. Lets say a very modest 4% Certificate of Deposit. That $25,000.00 CD would be worth more then $37,000.00 in ten years. My calculations showed it would take me 14 years to recoup my additional costs for geothermal. That same 25K CD for 14 years would have grown to well over $43,000.00. I think you see where Im going.

    This doesnt even calculate the additional costs if you are going to finance the additional $25,000.00 for a geothermal system. Work those numbers into the equation too and you will be running to the medicine cabinet for the hemorrhoid cream.

    Not to mention, we all know how rapidly technology is changing. I am fairly sure we will be seeing HVAC systems competing closer to geothermal efficiencies in the near future. Check out the two links

    http://www.supplyht.com/CDA/Archives/c79ed40ad83a8010VgnVCM100000f932a8c0

    http://news.thomasnet.com/IMT/archives/2003/04/new_hvac_techno.html?t=archive

    If you do the math properly and take the green emotional factor out of it, geothermal is not a cost saving option any way you look at it. The industry that promotes Geothermal should be upfront with us about that but their not. Geothermal is an extremely efficient and environmentally friendly option but in no way a cost savings. I wish I could afford it for my project but I cant.

  • java_man
    18 years ago
    last modified: 9 years ago

    Mepop,

    The issues you raised in paragraph 1 of your post were considered in my analysis. I believe I did the math properly. I'll describe my methods below and you can critique it if you wish.

    I used the appropriate financial analysis method for this -- net present value (NPV). This method calculates the yearly net cash flows, then "discounts" all future projected cash flows at the appropriate "cost of capital". Here are the details.

    The initial capital cost I used was $25,000 at year 0. This is the actual cost of my entire HVAC system, installed, minus the quoted installed costs for a high efficiency gas (HE gas) furnace system.

    The "cash inflows" calculated for future years are the difference between the annual operating and routine maintenance cost of HE gas (which is higher) minus the annual operating and routine maintenance cost of geothermal. This is the annual "saving" for the GHP.

    Using this method, the initial capital cost appears at its full "present value" of $25,000. All future projected savings are "discounted" to present value. This is done by dividing each year's net saving by [(1.05) to the nth power] where "n" is the year in which the cash flow is projected to occur. For example, the projected cash flow in the 8th year is divided by 1.4775 to reduce it to its "present value".

    This method is the "gold standard" for evaluation of capital projects. There have probably been millions of projects worldwide that have been either rejected or built based on this method of analysis.

    When critiquing a NPV analysis, the key questions are usually:

    - How accurate is the initial cost?
    - How accurate are the annual cash flows?
    - Was the appropriate "discount rate" used?

    Whether there will be more efficient systems in the future is important if you're not building today. But if you're building today (or as I did, 2 years ago) you can only use the technology that exists now. I don't think my wife would have agreed if I suggested going without heat for a few years to wait for new technology to become available. ;-)

    I agree with you on one point, though. I found most vendors of geothermal systems to be somewhat evasive about the actual savings and the time it would take for a GHP to "break even" vs. compared to alternatives. For that reason, I did my own analysis. I will continue to track the actual costs and savings so I will know exactly when my investment breaks even.

    By the way, my analysis showed a shorter payback period for an air source heat pump and supplementary electric furnace. I didn't go with that alternative because people in our region typically sleep with their windows open from May through October, and the homes here are close enough that an outside heat pump would have been disturbing to neighbours.

  • fsq4cw
    18 years ago
    last modified: 9 years ago

    The money we piss away in our lifetimes with hardly a thought; vacations we "need" or "deserve", luxury vehicles, vacation homes, summer camps, $50.K/yr to send the kid to university out of town to study G-d knows what where there may not even be jobs etc. Yet this we analyze down to the nth degree of the last nickel. Rationalization to this extent is itself irrational.

    We all have our reasons. Do it, dont do it. Who cares? For me this threads dead!

    SR

  • java_man
    18 years ago
    last modified: 9 years ago

    fsq4cw,

    Geothermal=double green

    The up-front cost of geothermal is high. A fairly typical new home builder like us could have added many desirable luxury features for the $25k we invested for GHP, or they could have limited the size of their mortgage. I think mepop and others who ask similar questions about the payback on geothermal are right to do so. In our case, this analysis has convinced me that we made the right decision. Geothermal is "green" from both an environmental and an investment perspective.

  • fsq4cw
    18 years ago
    last modified: 9 years ago

    Re: Java man

    Look, Im with you. I cant justify NOT doing it. We did it and any home Ill ever own will have to have it period! That heat pump is (almost) a member of our family. My wife bemoans the fact that its the ONLY thing in the house that Ill ever dust!

    I know everyone has to ask these questions. Most of us agonize over these questions, but at some point you have to stop the agony and make a decision. Some decisions are about more than just the money. Im not suggesting that it doesnt make economic sense either. When I compare heating costs with neighbors, theyre left in shocked disbelief, its almost embarrassing. I know the numbers are there when neighbors tell me theyre paying thousands more per heating season.

    SR

  • jay_haitch
    18 years ago
    last modified: 9 years ago

    Again, our outlook was long term. We hope to live in the new house forever. Therefore, I wanted to insulate myself from ever rising energy costs, with R2000 construction, plus geothermal. One builder we received a quote from actually discouraged us from using it, saying save the $24000. I look at it as an insurance policy. I'm paying something up front to get something in return. Yes the mortgage will be higher, but the savings will balance the extra cost, and increased energy prices will not have me breaking into a cold sweat. I'd rather lock in at current low mortgage rates for a long term mortgage, and save in the future on energy costs. This may not be the best financial desision from the actual accounting side as java man calculated, but it is a reasonable financial desision, and a good emotional one: peace of mind.

  • snblaes
    18 years ago
    last modified: 9 years ago

    Yesterday's Baltimore Sun spoke of deregulation of electric prices taking effect in Maryland in July with resultant increases of 40-80%. That may influence the above numbers.

  • mepop
    18 years ago
    last modified: 9 years ago

    I also live in Maryland and do believe electric prices will increase when todays reverse auction is over. The experts are predicting a 20% increase, not the 40% to 80% that the Baltimore Sun is (falsely but unsurprisingly) reporting.

    With that said, I ran my numbers again and even calculated a 50% increase in electric costs. Comparing a high seer heat pump with a fossil fuel back up to a geothermal closed loop horizontal system my results did change. My payback (not considering the increase in mortgage payments or the loss of investment opportunities) went from 14 years to little more then 12.2 years which still stinks!!!!! Thats not seeing a payback until the spring of 2018 folks.

    If you figure in the additional mortgage payments alone using a geothermal system then I will be paying more every single month until my mortgage is paid in full. On a 20 year mortgage, I wont see any positive results until 2026. How in the heck can that be a good financial decision?

    I concede with everyone commenting on this forum that geothermal is a fantastic system if you solely base it on the green concept. The problem I see with this forum is people are giving terrible advice to use geothermal to save money. The plain truth is geothermal is going to cost you more money then a conventional system even with the energy savings.

    The math doesnt lie and if you want to argue those facts then youre using an emotional issue, not a financial one. Its understandable that someone give advise based on an emotional issue but it should be stated as such.

    The rest of my post is pointed directly to SR. Steve, if youre going to say the tread is dead and continue to post comments, then the thread is not dead. Your attempts to push this issue looks like your doing so for self serving reasons. You steer people to your website and display information that does not give the complete picture. You should not be using this free forum to promote your business especially when you are not giving all the financial facts.

    I also dont think the other members would approve of your email to me where you wrote, ("Since you have a personal relationship, I would forget about Garden Web, in fact I would not even bother talking to ANYONE else (except me of course)!")

    And if your heat pump is almost a member of your family then I suggest you get out more often!!!

  • pyropaul
    18 years ago
    last modified: 9 years ago

    Mepop,

    if your financial analysis shows that a geothermal system is not cost effective, then don't install one! As I said earlier, the colder the climate, the more effective a geo system is because of its constant COP, whereas an air-to-air system's performance drops off. If you're in a relatively warmer climate, air-to-air is probably the greenest and most cost effective system but you need to do a full end-to-end energy and greenhouse gas analysis and take into account the future (not easy to do admittedly).

    Here in Quebec, it's very easy. The climate is very cold in winter (7200 HDD) and our electricity is almost 100% hydroelectric. Thus the effective greenhouse gas emissions of a geothermal system (and air-to-air) with electrical backup is zero. If your electricity is generated from oil/coal/natural gas, you have to figure perhaps as low as 30-40% efficiency in generating that electricity. If you use it for heat, then you can also factor in the COP of your heatpump (air or geo) and you may only get an effective performance of 85-110% in terms of greenhouse gas emissions compared to using fossil fuel directly for heating (where it is much more efficient than using it to generate electricity). Personally, I think it is an extravagant waste to burn natural gas to make electricity when up to 60% of the energy in it is lost. Much better to just burn it for heat directly.

    In my case, the financial analysis was such that I get an immediate positive cash flow situation (since all the old equipment was at end-of-life and we wanted to install aircon at the same time) so it was a no-brainer. From a green perspective, given our clean hydroelectricity, again it was a no-brainer.

    The only uncertainty is how fossil fuel prices will rise in the future (and there's no doubt that they will rise). If your local electicity supply is generated from fossil fuels, that will also rise at more or less the same rate. I'm sure that our electrical rates will rise much less fast than fossil fuel prices since the cost of the hydroelectric schemes has already been capitalized; even new schemes that are being mooted here are supposed to have a raw production cost of 1-2c per kWh - so I think *in my personal situation* we made the right decision going geothermal: lots of heating days, no greenhouse gas emission and cheap and stable electricity prices. Your mileage will vary.

    Paul.

  • java_man
    18 years ago
    last modified: 9 years ago

    Mepop,

    Until you've done a correct financial analysis, you shouldn't be chiding anyone for "giving terrible advice" about the investment value of geothermal. The math doesn't lie, but incorrect financial analysis misleads.

    If you really want to know whether geothermal would be a good investment for you, re-do your numbers using net present value as the method of analysis. It is the only method that makes sense. No financial analyst would use any other method. What you have said in at least 2 posts suggests you're doing it wrong. If you like, send me an email and I'll send you an excel (2003) spreadsheet pre-programmed to do the calculations. All you'll have to do is enter the numbers.

    Make sure you use the most accurate numbers possible for your up-front capital costs.

    Don't use outrageous numbers for your escalation of electricity and alternate fuel costs. The appropriate numbers to use for energy cost increases are those that fit your own region's electricity supply (and gas, if that's your alternate fuel) and the regulation regime that is in place.

    There will always be "bumps" in energy prices, but the only rational figures to put into such a long-term analysis is a smoothly escalating cost. If you model it on a spreadsheet, you can put in different cost increases for electricity (and gas or oil) and see what happens using different energy costs.

    The correct discount rate to use is not your mortgage rate. It is the return you could get if you invested the money however you invest your money. That is likely to be higher than your mortgage rate.

    Playing with the input variables is the only way you'll get comfortable with the real financial picture. Then, you'll be able to make a decision based on correct analysis. If you don't value the environmental advantages of geothermal, you're free to decide based on the numbers alone. But your decision will be an informed one based on a proper analysis.

  • chiroptera_mama
    18 years ago
    last modified: 9 years ago

    Wow! I am glad to have read this thread if only to stop thinking our new geothermal system is going to cost so much. The difference between air-to-air and geothermal for us, is $4000 ($1000 per ton for the wells). And we'll get $1000 back from our co-op for using green technology. With our tight budget and small (well built) home we were a bit hestiant to spend the extra $$, but had decided it is worth it for a variety of reasons.

    Living in the south, heat pumps are pretty much it for heat, AC is the biggie here and geothermal saves plenty on the summer cooling bill. Everyone we talk to with a geothermal system LOVES it (not sales people, homeowners). We will be insulating like crazy which may slow down the ROI a little (waah, a more efficient home :) but we plan to live here forever so what's 12 years in the grand scheme? That and some people do still place other priorities in life higher than money...

  • ken_in_virginia
    18 years ago
    last modified: 9 years ago

    I have been a reader for a long time and hope that my experience will assist those who are doing this job themselves or maybe an insite on the topic. I am a private contract and in my research I have found that you dont have to be a professional or an expert to install once of these systems. I have researched companies on the web and found two in Vermont that will do free radiant floor plans for you and one in Washington state. I have also found a company from Ohio that will plan your geothermal lines for you also. So if you have the land it is cheaper to rent a backhoe and dig your own lines. if you like email me at taylorhome@cox.net and I can supply you with my info my 6000 sq ft home using geothermal / radiant heat......

  • fsq4cw
    18 years ago
    last modified: 9 years ago

    Re: mepop

    Wow!

    Im sorry I didnt save a copy of our correspondence for my own records. However, your quote of my words will suffice. What I meant, and mistakenly thought was abundantly clear, was that since YOU have a personal and business relationship with this OTHER gentleman (as indicated to me through your correspondence), who IS an IGSHPA Certified Designer, you should take ALL your advice from HIM! He is the expert! Im saying this and meaning it literally; Im not being facetious. An IGSHPA Certified Designer is the highest level of competence. Why listen to anyone else including ANYONE on this forum, unless someone here has demonstrated a competency of equal value; particularly when this expert advised you NOT to install geothermal? When I said, "(except me of course)!" I was just inserting some sarcastic humor, which I plainly thought was obvious. Had I been serious, I would not have put that phrase in parentheses. I regret you took that so seriously as I think (I no longer have the copy) I explained that I am IGSHPA accredited, which may be fine, but is not the same thing as being an IGSHPA Certified geo-exchange designer who can design from A to Z a geothermal system for an large office tower.

    As I have previously stated, my professional involvement with geothermal is primarily with industrial, commercial and institutional applications. The people I do business with are mechanical engineers responsible for large physical plants and institutions, elected officials, and developers. I doubt ANY of them ever visit this site or mine for that matter!

    While I try to present the information on my web site accurately, no web site is the final word. Thats why I have links out to other sites providing even more information and other points of view. I have often encouraged people on this site to continue their research and I still do!

    Suggesting our heat pump is almost a member of our family was another attempt to insert humor where things are getting a little over-charged.

    For me, wanting this thread to be dead is because I see a nasty edge creeping into this.

    Mike lighten up! Its not life and death!

    Steve

  • smile3
    18 years ago
    last modified: 9 years ago

    Have any of you looked into solar space heating as an option? I ask because I have heard alot about green energy on this post. From what I have read it sounds like one of the cheaper sysems to install and run, am I missing something, or is it just not a highly considered option?

  • albs
    18 years ago
    last modified: 9 years ago

    Since everyone else is focusing on the financial aspects, allow me for a moment to say something about the green one.

    I will go on a limb and say that Geothermal systems are still "niche" markets. Not many people know what they are, even fewer have them.

    Electricity, propane, natural gas, fuel oil, diesel (and more) are all capable of heating and cooling. As you work through your calculations, it's very possible that Geothermal will cost you more up front than these other "well known" methods.

    As our population increases however, they will become less sustainable. Think when there were only 100k of us on earth. We could cut down trees, wear fur coats, burn fires, pretty much whatever we want -- with little impact to nature. Now as we push towards 7B people on the planet, things are different.

    Things we've done that have caused damage have been outlawed (think freon, leaded gasoline, dumping into rivers). The alternative is expensive, yes, at first. But the price goes down over time. The same is true for all new things.

    And it will be true for renewable energy, including Geothermal. Governments already know that we can not continue to abuse fossil fuel like we are doing. Many countries are already offering credits and incentives for homeowners to make the leap.

    I am fortunate enough to be in a position to spend a few extra (thousand) dollars for this new technology in my modest 3,000 sf CT home. Judging by the size of the home you are building I would presume you too are in a somewhat fortunate position.

    By going with this technology early on, we are helping to make this technology more mainstream and more available to the millions of others that will have to do it for it to make a difference. Not doing so, in my most humble opinion, is almost selfish. We, dare I say "the fortunate few", often pave the way that many others follow. Let's do it in a way that is the right way, not the most "self financially motivated" way.

    thank you for your time,
    A

  • todanderson_sd28_bc_ca
    18 years ago
    last modified: 9 years ago

    What is it that drives the cost of geothermal up as compared to a conventional system? Is it the digging and drilling? is the equipment much more expensive?

    If you install the system yourself, what kinds of dollars can you save.

    Anyone have any thoughts on using geothermal with radiant heating?

    great forum btw. It's nice hear all the differing viewpoints

  • pyropaul
    18 years ago
    last modified: 9 years ago

    There're two things which drives prices in a market: supply/ demand and volumne. Demand for geothermal equipment is relatively low and so this means that volume is also low. Price is inversely proportional to volume. Drilling, of course, adds to the cost. All that said, the equipment itself is not particularly expensive as it is pretty simple.

    If you install the system yourself, you will save some money but at what cost? Where's the warrantee if there's problems? How can you be sure the system is sized properly (not that that is particularly difficult to do with programs that are available from Natural Resources Canada).

    Geothermal works very well with radiant heating, but, again, it has to be properly designed. A water-to-water heatpump is actually quite cheap. We just had our second EnerGuide done and the auditor had installed his own system (though he is now a certified geo installer) and he was able to buy a water-to-water heatpump for around Can$1500. But you do have to know what you're doing to make it all work properly.

    For any Canadian readers here, I'd strongly suggest getting an EnerGuide test done before installing any geothermal system as you will be eligible for a reasonable grant after you do it due to the energy savings. Our house went from dismal (22 on the EnerGuide scale of 0-100) to 82 (better than R-2000) after we'd installed the geothermal system and fixed the air leakage problems.

    If you're serious about designing it yourself, you'll need some software to help. The Buildings Group of Natural resources Canada has pretty much everything you need (and it's all available for free). I'd recommend Hot2000 as a starting point to help evaluate your current house and try out some ideas for upgrades. The program does model geothermal heatpumps pretty well and the estimated running costs it came up with for my house are within 10% of reality .

    Feel free to contact me if you'd like more information.

    Paul.

  • LRA
    17 years ago
    last modified: 9 years ago

    okay - did anyone find a good geothermal contractor in maryland???

  • mwb4859
    17 years ago
    last modified: 9 years ago

    I've been studying Geothermal for 2 years now. What drives the price up are the people building and installing the units. It costs less to produce a geothermal unit than it does a comperable air source heat pump. They are the same thing except you substitute the outside condensor coil for a water heat exchanger and the condensor fan motor for a small pump and you don't have the outside cabinet to build. The same geo unit will cost twice what the air source unit will cost. The additional cost are the indoor plumbing and the outdoor loops. I'm and Engineer and design and build equipment and machines everyday. The other thing here is all you hear is how hard it is to design one of these systems. I hate to sound like I'm paranoid but these people want to keep the cost of these systems high. I will design, build and install my own split two unit 4-1/2 ton system for about $5,000 dollars.
    Mike

  • pjb999
    17 years ago
    last modified: 9 years ago

    Interesting thread. I hadn't considered Geo as a viable alternative since our place is pre-exisiting, however, furnace is 10 years old and 80%, and we have no A/C - originally considered air source heat pump but am beginning to wonder about geo - there's quite a lot of it (at least in new construction) here in Kamloops, BC.

    Again like Quebec, we have mostly hydro-electric which is currently about the cleanest energy that can be produced - and n gas is going up reasonably steadily...

    In the naysayers book, and some of the other calculations, people are assuming fossil fuels will follow current pricing trends.....but are forgetting things like Peak Oil. In the past couple of years, I've read that the oil industry spent MORE on exploration than revenue GAINED from new sources, in other words, it lost money on todays prices vs new sources found.

    This won't remain a steady curve, it'll become logarithmic....and what about rationing? If you look at the more pessimistic views of the world and oil, things are going to turn pretty nasty in the next ten to twenty years....and I'd like to know I can still at least be warm at home, if I'm walking to work....

    I don't think it's a matter of which countries the West can invade to secure cheap or available oil, with emerging countries becoming such big users too, for one, it'll be scarce, and the time will come when we have to husband our resources....and burning oil or gas just for heating will become unsustainable.

    When I lived in New Zealand in the late '70's-early 80's we had a bout of fuel rationing...believe me, given finite allocations, I'd rather heat my house cheap and still have a car to drive, for example.

  • bob_brown
    17 years ago
    last modified: 9 years ago

    Hello,
    How many tons of equipment does that $110k cover. For that much money, I can send my kid to college to become a doctor, and still install a wiz-bang geo system.

    In all calculations, the more work the cheaper it gets. When doing a rough estimate I use 600 sqft per ton for a guestimate. 12.5 tons at $110k. Get real. That should be 12 holes and 2-3 systems. If a system goes for 15k then you are into 45k tops. Drilling 12 holes should be much cheaper per hole than a smaller job.

    I recently found a manufacturer that makes an airhandler with a AC coil, Water coil and electric strip. The water coil is approximately 40k btu, the AC can be 4 tons. The cost is under $3k retail. The company makes product for York. The water coil can be used for Hot Water preheating or as heat.

    As I have said many times in the past get more bids.

  • greggmc_2006
    17 years ago
    last modified: 9 years ago

    If I were going to spend 110K for such a system (I wouldn't), I'd think about investing that money to get a fixed return. In that way the monthly heating bill would be taken care of (for the foreseeable future) and most of the principal would still be available.

    I am interested in vertical loop systems and in particular the electricity costs involved in geothermal vs. the heating/cooling and electricity costs in conventional efficient systems. Finding definitive answers has proven rather challenging! We intend to build a home in Kamloops, BC (western Canada)with a total area of 2650 sq.ft.(1550 up and roughly 1100 down + garage) but if we could heat the garage for free, we'd do that as well. It will face south and receive tremendous sunshine in summer along with very high temps, but be cloudy and fairly cold in winter.
    We're considering an efficient Carrier system because we'd NEED to add humidity in summer. Not only would dryness affect people,but also flooring, furniture and paintings, etc.
    Any comments? Especially from Canadians or others who live in DRY climates.
    Cheers.

  • lotsofhomework
    17 years ago
    last modified: 9 years ago

    I am in the process of getting geothermal bids for my remodel in Maryland, outside of DC. Can anyone tell me what I should expect to pay to heat and cool 7500 sq.ft. on a 3 zone system?

    So far, I only got a ballpark number from the firm that claims to be the only "experts" in the area. It was far more than double our original figure for a traditional system (combined electric heat pump and propane gas).

    My GC says the original HVAC contractor is going to come in with a more reasonable number and that they have experience with geothermal too. How important is IGSHPA certification?

    I feel like the "experts" are charging quite a premium for their expertise, but in reality they have a kid with only one month's experience designing our system. We're determined to do geothermal for the "green" reasons, not just to save money in the long run, but our resources are not unlimited and I don't want to overpay. Any advice?

    Thanks!

  • bisonjam
    16 years ago
    last modified: 9 years ago

    We have decided topurchase ageothermal unit for a house we are remodeling. So far we have received two quotes one for $11,000 for a Trane and $16,000 for a Waterfurnace premier with desuperheater both of these are 3 ton units. Now we are responsible for the digging of 350 feet of 6 foot deep trench. We were told that for $4,500 they could lay pipe and bring it into the house. We are now thinking maybe we should just buy the unit ourselves and install it. What does it cost for similar 3 ton units with desuperheater? We have no idea.

  • marknmt
    16 years ago
    last modified: 9 years ago

    Bisonjam, you can search on this forum for all the comments I've made about our three ton Climatemaster, including desuperheater, with I hope a zillion caveats. That said, we're glad we did it.

    We paid $7659 for the unit itself, including installation and minor sheet metal modification. We paid quite a bit more to drill a well (it's an open loop system; would have been better to have a closed loop like yours), upgrade our electrical service, deal with associated plumbing, excavating, testing, and so on. All told about $14,000, not all of it chargeable to the heating system.

    We did a LOT of the work ourselves, but would have had no clue to the wiring of the heatpump unit itself; I would suggest that you want the dealer to install the system (it should not be a large part of the cost) and then if something goes wrong he can be held accountable more readily.

    We needed to rent an excavator to dig a fairly short trench (24 feet, I think) about four feet deep and only 18" wide. I did that at considerable savings, but I had to worry about ripping up the sewer line, caving in the house foundation, backing into the garage, and so on. At one point I was near tears, but my wife got me back on track! If you have plenty of room you can no doubt dig a nice, wide trench cheaper than you can have it done, and it is a lot of fun, actually. My mistake was not giving myself enough time and working too long in the sun without breaks- and, I didn't have much working room.

    So far we've been happy with the Climatemaster, but it's only about 6 months old.

    Good luck,

    Mark

  • armstrr
    15 years ago
    last modified: 9 years ago

    i wonder what mepop's oil bills will look like this winter...yeoch!

  • qbert
    15 years ago
    last modified: 9 years ago

    I don't know if this helps any but the guys who were estimating my place worked up numbers for geothermal and they were just about twice the cost of a regular heat pump (14 to 17 K vs 7 to 9 K standard). This they attributed to each geothermal system being a special built unit. They said that in 5 years or so they should be mass produced and the costs will come down.

  • fsq4cw
    15 years ago
    last modified: 9 years ago

    Re: qbert

    As the cost of energy goes up geothermal becomes more of a bargain. $17k sounds like a good deal for a properly designed & installed GSHP. The cost of drilling is not likely to EVER come down so dont wait! At $1M a copy, the cost of owning & maintaining a state-of-the-art drill rig is like keeping a plane in the air! Dont dream that its going to get cheaper. The maintenance & replacement cost of these machines will only become much higher; guess whos going to be paying?

    IMO

    SR

  • d.goodbrand
    15 years ago
    last modified: 9 years ago

    I am currently looking into installing a Geothermal system as a retrofit on our 12 year old house mainly because of a combined Federal and Provincial grant that would pay for almost 30% of the cost of the system but that still means a 17k - 18k investment

    My problem at the moment is the calculations all the contractors of these systems use indicate our current energy use ( propane ) should be far, far higher than they actually are which , of course, skews the calculations on how much the system will save us over time. Either I have a much tighter home than I suspected or these calcs they are using are designed to give higher numbers to show higher savings.

    I would very much like to hear from anyone who has converted from a natural gas, oil or propane system to Geothermal. Specifically how much did your electrical bill increase as a percentage? 5% ?, 10% ? 50% ??

    This , for me, is the sticking point at the moment and I need to hear from real people living in real houses who have made the change over .

    Don

  • fsq4cw
    15 years ago
    last modified: 9 years ago

    Re: d.goodbrand

    We live in a semi-detached bungalow that is a mirror image of our neighbor and $ave 86% on heating compared to them. We set our stats at the same temp.

    You have some homework to do if you want any of that grant money. First of all, your system has to be designed, installed and drilled by CGC accredited designers, installers and drillers. You must have (for submission to the CGC) heat gain/loss calcs done to the CAN/CSA F280 HRAI standard. Expect to pay a premium to have this premium, Certified CGC system installed. Guess where your grant money goes

    SR

  • d.goodbrand
    15 years ago
    last modified: 9 years ago

    OK, you save 86% on your heating bills but how much higher are your electrical bills than your neighbour and what kind of heating is he using now? ( and how old is this semi-detached bungalow ) Does that 86% include both the increase in your electrical bill and the cost of his heating fuel?

    There are so many variables involved with this that it's safe to say everyone will have a different end result. My house is already nearly airtight and is insulated almost to the maximum and at 2900 sq feet I use on average of 2300 litres of propane ( about 608 US Gallons ) a year to heat the house AND the water heater.

    Re Grants. To install a trenched closed loop system and a 5 or 6 ton unit will cost around $25,000 . The grants will cover roughly $7750. To get the grants we needed to hire an approved energy auditor which recorded all the systems in the house covered by government grants and do a air loss test. This I have already done. Once I've completed whatever work I decide to do I call them back, they verify the work was done and submit the paperwork to the goverment . The end result is installing a system of that type would cost me between $17,000 and $18,000 after the grants are taken into account.

    The problem with all of this is each house is different. If someone's living in an old farm house with little insulation and they are paying $4500 a year to heat it with oil for example the Geothermal will pay for itself faster because it's that much more efficient than oil but an already energy efficient house takes longer to realize a positive benefit in the wallet at the end of the year. By the calculations I've been given and from what I've researched my electrical bill will go up about $100 to run the Geothermal and that is primarily why I'm interested in hearing from anyone else who installed one of these systems after running previously on oil, propane or natural gas.. ....how much has you electrical bill gone up running this thing ??

    In my case that nearly doubles my electrical bill and although I can expect to eliminate an averaged propane bill of $166 a month the added $100 a month average increase in my electrical bill means my net savings per month is only $66. Given the system will cost me nearly $18,000 to install after the grants saving $60 month takes 23 years to break even and even when I factor in that in ten years it's likely that both electrical energy and oil, gas etc will double it still doesn't bring the break even point down to anything reasonable that is why I would like to see what increases others have seen in their electrical bills as that is my sticking point on this system.

    A poster at the start of this thread said their " kw usage has more than doubled " and if that is typical then for me, even in the long term this doesn't seem to be a smart way to go because one thing I do know is Ontario is going to "smart" meters and all "smart" meters do is screw you over a bit more during the times you want to use power. It's cheap at night during the low peak times but that defeats the entire purpose of a programmable thermostat that would be turned down at night and turned up just in time to hit the peak rate. The "social engineers" may think they are doing this to save power but the end result is a cash grab that I calculate will be somewhere between 5.5% and 11.4 % above what I'm paying now because most things in the house will be running during the high or mid peak range and that's another reason why, in my case, Geothermal seems not to be the best solution even though I really like the whole idea of geothermal, However, the math isn't adding up for me so I would be most interested in hearing from people on this

    Don

  • bobloblaw_yahoo_ca
    15 years ago
    last modified: 9 years ago

    Don,

    I put in geothermal last year, and I worked with a dealer who provided me with the equipment so I could install the geothermal myself. I received six quotes for the full installation that started at $28,000. I did it myself for just over $16,000 total ($8400 after the grants). This includes the costs to contract out the ductwork (~$2000) and trenching (~$1800). The dealer provided me with expertise, an energy evaluation, and even came to my house to fuse the pipe and fill and purge the system. He provided me with the certification required to receive the provincial and federal grants.

    Most geothermal installers are overcharging for these systems because they would rather install less systems and make more profit - they only want to deal with the super rich who will pay the $$ to be green.

    But to your point, my average electric bill before geo was $120 per month in the spring and fall with no heating or cooling turned on. I heated my house with a combination of a pellet stove for the upstairs and electric heaters in the basement.

    From Oct 05 to May 06 I spent $1900 on electricity and $1300 on wood pellets, and my second floor was cold!

    From Oct 06 to May 07 I spent $2400 on electricity (colder winter, tenant turned up the heat in basement) and $1200 on wood pellets.

    My geothermal went in last September (07).
    This year, from Oct 07 to May 08 I spent $1647 in electricity.

    If I take my average cost of electricity (based on the past three years in months where I did not heat or cool my house) of $120 and subtract that from my electric bills from Oct to May of this year, it cost me $656.13 to heat my house this year, and I had the thermostat set to a comfortable 22 degrees C. It is a 2200 sq ft house in Southwestern Ontario. The savings were undeniable.

    If you are interested, the dealer I worked with is at www.NiagaraGeothermal.com.

  • d.goodbrand
    15 years ago
    last modified: 9 years ago

    Thanks for the info John. It's been very helpful.We don't live very far apart it seems so I will look into the dealer you mentioned

    Don

  • cs6000
    15 years ago
    last modified: 9 years ago

    I know this thread has been going a long time, hopefully some folks will still look at it.
    I'm planning a 2100 sq ft single story home in Oklahoma to build next year. Its out in the country, with a high priced coop electric.
    Have traded emails with a geothermal installer in the area. He installs Climatemaster systems, which are built here in Oklahoma. Seems like a knowledgeable pro.

    Rural heating around here is traditionally propane. According to the installer, a backup heat source is required by code. I am a big time wood stove user, and planned for this to be my only back-up, which does not satisfy the code requirement. He recommended using a small heat strip system to satisfy the code, if that's what I wanted. Said the cost would be trivial in the overall budget.

    I still have not decided whether the geothermal is right for me, this installer is sending me literature that hopefully compares some installation costs. Its all a cost issue for me. Will be in the house many years, and worry about increases in rural electricity costs and propane.

    Very difficult for anyone to come out and say "well the geothermal would be around 20 grand and convention 5 or 6 grand"
    Would love any input, thanks.

  • fsq4cw
    15 years ago
    last modified: 9 years ago

    If you plan to be in your home for many years I would recommend that you invest in your home by installing a geothermal system. That will have 2 immediate effects. First you will increase the resale value of your home and second you will save a tremendous amount of money on energy - from year one.

    Some food for thought as you age in your home, first, when you retire and may be on a fixed income, you want your overhead to be as low as possible. No other form of active heating and cooling will be as inexpensive as geothermal. Second, as you age, you may not be as able to deal with all the firewood, so guess what, your other source of heating will become your primary source. Geothermal will have the lowest costs.

    Should you choose geothermal, have your contractor install the proper size aux heat strips for the backup as if thats the only system available. Its cheap insurance and it wont be called on much.

    SR

  • davidsss6600
    15 years ago
    last modified: 9 years ago

    check out www.geothermal-house.com and see the efficiencies that we have accomplished with geo units, we are in the process of putting actual heating bills so the people out there can compare to their homes

  • acchaladka
    15 years ago
    last modified: 9 years ago

    Hello Everyone,

    Full disclosure first: I work with the CGC, the Canadian GeoExchange Coalition (CGC). We just issued the following consumer advisory which I thought might help:
    http://www.geo-exchange.ca/en/canadian_geoexchange_coalition_warns_of_contractor_nw124.php

    Canadian industry leaders, utilities, and our governments in 2005 turned away from the model that the US has and developed a national quality program based on CSA standards for design and installation of geo systems. CGC Accredited Installers and Designers meet a higher standard - not simply full training but insurance, proper licensing, previous experience, a written promise to uphold our Code of Conduct and work to best practices (including properly documenting systems and treating customers fairly), and the possibility of having to fix any honest mistakes or losing their accreditation, in the face of consumer complaints. The federal and several provincial governments require our quality program for their incentive, and the Canadian market is growing much more quickly than the US market as a result.

    A program history is here:
    http://www.geo-exchange.ca/en/accreditation_program_description_p34.php

    Our concern and our members' concern is that consumers are at the mercy of unregulated and uncontrolled industry at this time.

    In the United States, there is no ASTM Standard for design or installation of these systems.

  • StephB
    15 years ago
    last modified: 9 years ago

    Has anyone installed a geothermal heat pump in Maryland? We are also planning to build a new home in central Maryland. I would like to know how warm the system is in the winter (do you have to use the backup system much) and have you noticed a cost savings to monthly heating bills as compared to your neighbors? Finally, can you recommend a local geo contractor?

  • lshemick
    15 years ago
    last modified: 9 years ago

    I understand from real estate websites that I might get 50 percent back on the cost of a geothermal system - but in today's frantic oil climate, I'm wondering if this may no longer be the case. The house is 1500 square feet, with central air, the monthly KH use for winter is about 425, the highest in the summer is 1100, and I hope to also install solar to take care of part of the load, once tax incentives arrive (if ever). Installation of geothermal is projected to be about $15,000. I have a 1000-gal fuel oil tank, the bill for which causes me to blanch.
    Any thoughts on whether I can break even on the $15,000 when I sell the house (which will be five years or less)?

  • fsq4cw
    15 years ago
    last modified: 9 years ago

    Re: lshemick

    5-fill-ups at 500gal a shot at $3/gal is $7.5k (50% of you geothermal investment). Let me guess, your 1000-gallon oil tank is buried right? How much do you think youll have to reduce the price of your home when you tell your real estate agent about that buried treasure!

    Geothermal installed at ~$15k is a no brainer!

    SR

  • winspiff
    15 years ago
    last modified: 9 years ago

    It boggles my mind that people think 10 years is a long time. After installation, you pay each month (including financing) about what you were already paying anyway (probably less). You do it for 10 years, (especially with all the new government incentives, rebates, and low-interest financing now available) and after 10 years you're paying a ridiculously paltry amount for heat. Of course it makes sense.

    Think of the payback over 20 years once that loan is paid off! Even if you only end up paying even 1/2 of the normal cost over that period (including the cost of your system and electric), you're still saving substantially. I know not everyone lives in a home for that long, but seeing low energy bills does increase home values. I've seen homes sold almost immediately with their main advertising point being their geothermal system even in our horrible present climate while others still linger on the market. Not only that, but why not decrease your monthly bills slightly (before the loan is paid off)? Slightly lower bills, a higher sales price which will pay off the rest of that loan - still makes sense.

    We had someone come out to our house and they specifically calculated everything from current estimated heating costs, heating/cooling with geo, then savings/payback period. This was a full service option, including thermostats, etc. Finding that should not be difficult.

    One argument I saw above made no sense. If it really is worth insulating your home to use a normal system, it is a no-brainer to insulate your home using geo. Whether you decide to use geo or not, you can't say, "Well, normal is better, because we insulated, too." That makes no sense. Insulate either way. Then compare.

    The financial analysis does not make much sense, either. Yes, it would be wonderful if we could just stop paying the oil company, live without heat, and invest that money! Realistically, while you could want to put away the whole $25,000, you really are still using it for heat either way over those 14 years as projected. Geo, with the loan, electric, etc, will cost about the same each month as heat before the loan is paid off, so you can't just pretend that money could be invested elsewhere. Use it upfront with geo, use it over several years with oil, it makes no difference. That money is being spent on heat. Should it be spent on something worthwhile, or just, at the end of 10 years, have you still spending the same amount on more heat with oil?

    Geo will typically initially cost you a little less (including the loan and electricity) per month than you would be paying otherwise, then suddenly drop dramatically to only the cost of using the system as soon as that loan is paid off. That's money you would have spent anyway each month with your normal system (even though some of it went to financing, it is still less that what you would have paid for oil). Then suddenly, once the loan is gone, you actually DO have perhaps $1,000 a year in money saved that you can invest if you wish over 10 years.

    If, with financing costs, it does cost more per month than your normal heating system, that's one thing; but if not, the argument that it is wasting money is not valid. You're spending it anyway. Might as well spend it on something that will, in the future, save you tons of money. (Not just a little, a lot.)

  • schoolboy
    15 years ago
    last modified: 9 years ago

    hey ya'll, i've been reading these forums for a while now and i thought i would just put my two cents in. i currently own a 4900 sq/ft school building in wich i am forced to stay in about a 1/6th of the livable space due to heating costs. currently it has all electric baseboards!! everything just to heat this small section of the house runs me around 300 a month and this is not living too comfortably. every person i have spoke with about geothermal has been pretty close to eachother. system install would range from 30,000 to 43,000 depending on the system i go with. now the huge selling point for me is that for the same price it costs me to heat my tiny portion of the building i've been living in, i would be able to heat the entire building and stay comfortable. so for the additional 300 i would spend on my mortgage i will ultimately be getting a greater return and will be able to pay my house off much quicker than the original 30 yr loan i have. the added bonus that the building is split into apartments that i will be renting out will also make this a much worth while project for me.

  • randy1512
    14 years ago
    last modified: 9 years ago

    Up front cost for geothermal can be as much as twice as a conventional
    system, however with an average of 50 percent savings on energy and
    a 30 percent federal tax break it more than justifies the upfront cost and the longevity of the system is three rimes that of a conventional one

  • randy1512
    14 years ago
    last modified: 9 years ago

    Look into an Alternative Company called Lee Alternative Energies, LLC
    they have been doing Geothermal and Solar for over 25 years
    and even if you don't use them they will be glad to steer you in the right
    direction at know cost 410-667-1059 or
    863-558-6835

  • elmer_fwd_antelecom_net
    13 years ago
    last modified: 9 years ago

    The 30% tax credit on installing a geothermal heat pump system in the USA caught my interest. The 30% tax credit will run until 2016, so no real big hurry.

    So I figured that my monthly costs for gas and electricity run about $275. So if I were to save the entire amount by installing a geothermal system, it would take me about 6 years to pay back a system that costs me $30000. This is calculated based on ($30000 - $10000 ) / 12 / 275.

    If I save 50% in my monthly electric and gas bill it would be about 12 years.

    The $30000 is just a number I pulled out of a hat.

    If I lived in California and not Missouri, my electric costs would be about 2.5 times as much, so it would make it a lot more attractive. I believe in doing things Green, but I am still on the fence.

    By the way, electricity in my area is about 0.04 per Kwh.

    Natural gas from Lacleud Gas is cheep also.

    I will keep you updated.

    Another good tip for you follows:

    ClimateMaster Tranquility 27 has the following specs:

    ClimateMasters Tranquility 27 series of heat pumps are available in sizes 2 tons (7.6 kW) through 6 tons (21.1 kW) with efficiencies up to 31.5 EER and 5.1 COP.

    The ERR and COP are the highest I have seen when comparing systems. I don't know how much the system is, but I am researching it right now.

  • atjorasz_hotmail_com
    13 years ago
    last modified: 9 years ago

    We installed a closed loop Geo system in October of 2009. It was retro-fitted into our farm house and we were told that it would cost about $70.00/mo in the coldest winter mos to run (we live in Michigan). We paid $200/mo for electricity before the install. Now we pay $400/mo for electric ALL YEAR ROUND on the budget plan. We keep the thermostat set at 72 and heat 2500 sq ft. Today we had to call the installer because the condenser quit working and they are installing a new one tomorrow. Until then we will have to run it on auxillary heat (who knows how much that will cost over 24 hrs). This system has been a complete waste of money for us and is, in my opinion, only efficient in a new build. Also, it runs very loud and sometimes wakes me up at night. Go with an outdoor wood boiler and save yourself serious cash. I figure for the $25000 we have invested in the GEO we could've bought a wood burner and 15 years worth of wood! FYI

  • jasmine1897
    13 years ago
    last modified: 9 years ago

    Has anyone used the savings calculators on many of the geothermal websites? Do they accurately reflect your savings? I am considering geothermal to either replace my oil fired boiler or use the oil as a backup. My house is about 4400 sq. ft and located in central Maryland. The cost after rebates will be $39,500. The system will consist of two 3 ton units and one 2 ton. Any comments would be welcome.

  • neohioheatpump
    13 years ago
    last modified: 9 years ago

    To the guy in Maryland proposing the $39,500 system. How much does your electricity currently cost? I'm talking the total rate per KW delivered (divide the dollars by the KW used)?

    Do you get alot of below freezing (32F) weather in Maryland?
    Do you have access to natural gas?

  • roadrnnr
    11 years ago
    last modified: 9 years ago

    I am trying to get a real world price.
    I have a 1400sq foot per side duplex(about 2800-3000 sq feet total). I am looking at getting an open loop,( I think System) installed. Going to be using my current well and not drilling a second.
    I have a quote for installing a system that will heat both sides of the duplex using my current hot water baseboards. Contractor was highly recomended by well driller that put my well in. Total cost around $20K. Both sides use about 500 gallons of oil a year(1000 total) for heat and hot water. At Current rates thats about $400 a month for oil. I could rent the other side for an extra $200 a month heated and I figure pay off the 20K in about 5-6 years, so for me seems to make sense.

    Does $20k sound about right to install a Geo system?

    I live in New England where winters are long and cold.

  • fsq4cw
    11 years ago
    last modified: 9 years ago

    Re: roadrnnr

    So you're planning to install an open loop water-to-water geothermal heat pump system. What type of hydronic radiators do you have now? What is the current supply temperature of water from the boiler? How do you plan to make up the difference in Btu delivered between your present system and a geo system since there will likely be a MINIMUM of 25-degrees less with the geo system?

    "Does $20k sound about right to install a Geo system?" I doubt it; this is not a simple swap out of an oil boiler for gas. You have to think about efficiency, zoning, controls, variable speed circulators, A/C, DHW, buffer tanks, backup boiler, electrical panel requirements, plumbing, additional radiators and on and on AND ON.

    I would guess $45k ~ $60k (minimum) would be more like it.

    BTW: Assuming your existing well can pump the required gpm/hr, how deep is your well, what will pumping cost as this is not a closed (balanced) system, what do you plan to do with all that water and what happens if the level or flow of the water table drops?

    I'm not trying to talk you out of this. I think it's a great idea - if done right and you're truly prepared for the challenges and CO$T$ ahead!

    IMPO

    SR