The costs and benefits of geothermal heating vary according to the size of the property, and the complexity of the installation. However, it is certainly clear that installing a ground source heat pump will definitely save you money, and that you will recover the cost of installation within 4 to 10 years. In addition, you value gain on your property is often higher than the cost of installation, likely to increase in the future as renewable energy becomes more important in the public mind.
Cost of Purchase and Installation
These costs are approximate, and based on the most expensive, most efficient system that you would install on a medium sized family home (about 2000 square feet).
- A 36,000 BTU split system, with a COP of 4.2 (i.e. 4.2 units of heat produced for every unit of input energy – one of the most efficient) costs about $5,500 to buy.
- The underground loop system (either vertical or horizontal) costs about $3,000
- Installation costs by a professional installer would depend on the area and experience, but you should count on $5,000-$8,000
- Digging and soil replacement costs by professional back-hoe operator, or drilling costs for a vertical system: $3,000 – $8,000.
Your savings would include the following factors:
- Federal tax credit of 30% (about $6,000 using the figures above)
- Monthly savings in propane or oil: $200 – $250. Equates to a minimum of $2,400 per year.
Given the above (ball-park) figures, it would take about six years to pay back the cost of installation. Most surveys and quantifications of cost arrive at similar figures, however it is important to do your own calculations and get more exact quotes from local operators.
Of course, if you have the skills, it is possible to do a DIY installation. This can save costs, especially for the digging and equipment installation. You should, however, take note that if you mess it up, you may need to pay more for a professional to sort it out. In addition, providing the necessary proof of expenditure for the tax incentives can be more tricky.
Factors to consider when calculating costs
- Ground source heat pumps can be retro-fitted, but it is often better to consider installing on a new property, and simultaneously installing underfloor heating. This can then be calculated into the overall cost of the building project.
- When retro-fitting into a house without underfloor heating, you may wish to consider increasing the size of the radiators in your house. This is because, even though the system is highly efficient, it does not attain the temperatures that oil fired heating systems achieve. This means it takes a bit longer to heat your home, and the system will generally run for more hours per day than regular systems. Nevertheless, the savings are still the same!
- It helps if your house is well insulated, so that you conserve as much heat as possible. If retro-fitting, you may wish to consider upgrading your insulation package (also subject to tax breaks!)
- Running costs will increase if you use the system for household hot water needs, so you may wish to install a solar water heater on your roof to supplement the ground water system. This will result in additional savings, and is also subject to tax credits.
- You may wish to install a bank of solar photovoltaic panels that would provide the electricity to run the system. A three way system (ground source heat pump, solar water heater and solar electric panels) would give you a cost free system that could be paid off in 10 years, allow you to benefit from several federal and state incentives, and leave you completely or partially energy independent.
- The installation can get messy, because it involves digging up a large part of your garden. You need to be aware of underground pipes and power or phone lines, and you may need to get permission from your local authorities. Consider the cost of such an application, which would involve submitting diagrams and plans, as well as an inspection to mark out existing lines.
Is it worth it?
To install a major system like this, which can be paid back in less than 10 years, and that will give you an additional 15-20 years of greatly reduced heating costs, is definitely worth it. The increased value (especially future value) to your property after the system is installed, and the peace of mind that you have from doing your bit to keep the planet green are all incalculable. The value of being energy independent, and not subject to the variables and manipulations of power and oil companies: priceless!