Geothermal Heat Pumps Make Sense for Homeowners

Geothermal heat pumps are one of the most efficient ways to heat and cool a home and provide hot water. More and more homeowners are discovering the benefits of these systems, which tap the relatively constant temperature of the Earth a few feet underground, for both new homes and retrofits in existing houses.

Geothermal Heat Pump
Geothermal heat pumps use the stable temperature of the ground (vertical boreholes typically are 100 to 400 feet deep) as a heat source to warm buildings in winter and as a heat sink to cool them in summer.

Why a Geothermal Heat Pump?

The installation of a heating or cooling system is a decision that will affect a homeowner's comfort—and pocketbook—for years to come. One option to think about is a geothermal heat pump (GHP), which is one of the most cost-effective and longest-lasting on the market. Plus, GHPs provide free hot water as a byproduct of air conditioning for the household in the summer.

Also known as ground-source heat pumps or GeoExchangeSMsystems, GHPs provide many benefits to the homeowner in both new and retrofit situations. Surveys by utilities illustrate a high level of satisfaction with GHPs compared to conventional systems. In fact, more than 95% of all GHP users would recommend a simi-lar system to their friends and family.

According to the Environmental Protection Agency (EPA), GeoExchange systems are the most energy-efficient, environmentally clean, and cost-effective space conditioning systems available.

Simply put, a GHP system moves the heat from the earth (or a groundwater source) into the home in the winter, and pulls the heat from the house and discharges it into the ground in the summer. The underground (or underwater) piping loops serve as a heat source in the winter and a heat sink in the summer. While many parts of the country experience seasonal temperature extremes—from scorching heat in the summer to sub-zero cold in the winter—a few feet below the earth's surface the ground remains at a relatively constant temperature. Depending on latitude, ground tem-peratures range from 45°F (7°C) to 75°F (21°C). Like a cave, this ground temperature is warmer than the air above it during the winter and cooler than the air in the summer. The GHP takes advantage of this by exchanging heat with the earth through a ground heat exchanger rather than with the outside air as with air conditioners.

GHPs Offer Many Benefits

In even the coldest climates, geothermal heat pumps offer cost savings, durability, low maintenance, year-round comfort, and other benefits.

Cost Effective

Geothermal heat pumps save money in operating and maintenance costs. While the initial purchase price of a residential GHP system is often higher than that of a comparable gas-fired furnace and central air-conditioning system, it is more efficient, thereby saving money every month. For further savings, GHPs equipped with a device called a “desuperheater” can heat the household water. In the summer cooling period, the heat that is taken from the house is used to heat the water for free. In the winter, water heating costs are reduced by about half.

On average, a geothermal heat pump system costs about $2,500 per ton of capac-ity, or roughly $7,500 for a 3-ton unit (typical residential size). In comparison, other systems would cost about $4,000 with air conditioning. When included in the mortgage, the homeowner has a positive cash flow from the beginning. For exam-ple, say that the extra $3,500 will add $30 per month to each mortgage payment. But the energy cost savings will easily exceed that added mortgage amount over the course of each year. On a retrofit, the GHP's high efficiency typically means much lower utility bills, allowing the investment to be recouped in two to ten years.

In addition, some electric utilities have financing pack-ages that make the purchase of a GHP system even less expensive. Other utilities are providing special electric rates for homes with GHP systems installed


Because they use fewer mechanical components, and because those components are sheltered from the elements, leaves, dirt, and possible vandalism, geothermal heat pumps are durable and highly reliable. The under-ground piping used in the system often has 25- to 50-year warranties, and the GHPs themselves typically last 20 years or more.

Low Maintenance

Geothermal heat pump systems have fewer mainte-nance requirements than most other systems. When properly installed, the underground components are virtually worry free. The components in the living space are easily accessible, which increases the convenience factor and helps ensure that the upkeep is done on a timely basis.

Year-Round Comfort

Like the typical forced-air furnace or central air-condi-tioning system, a GHP system uses ductwork. A two-speed GHP system is so quiet inside a house that users do not know it is operating because there are no tell-tale blasts of cold or hot air, depending on whether it's the heating or cooling season.

GHPs also improve humidity control by maintaining about 50% relative indoor humidity, making GHPs very effective in humid areas.

Quiet Operation

With GHPs, there are no outside condensing units like air conditioners, so there's no concern about A/C noise near patio areas or decks, or bothering the neighbors with the constant hum of a conventional air conditioner.

Geothermal Heat Pumps Are Highly Efficient


A study by the Environmental Protection Agency analyzed six loca-tions representing major climate zones in the U.S. These cities (Burlington, VT; Chicago, IL; upper New York City; Portland,OR; Atlanta, GA; and Phoenix, AZ) were chosen to compare the performance and costs of emerging high-efficiency space-conditioning equipment with equip-ment already on the market.

For all locations, the findings named geothermal heat pumps as the most efficient heating and cooling systems over other types of space-conditioning equipment including high-efficiency gas furnaces and air conditioners. Geothermal heat pump installations in both new and existing homes can reduce energy consumption 25% to 75% compared to older or conven-tional replacement systems. Annual operating costs were also lowest with geothermal heat pumps. Add in the benefits of the desuperheater for hot water savings, and it's easy to see how a GHP system is the most efficient available.

GHPs Have Low Environmental Impact

Because a GHP system is so efficient, it uses a lot less energy to maintain comfortable indoor temperatures. This means that less energy—often created from burn-ing fossil fuels—is needed to operate a GHP. According to the EPA, geothermal heat pumps can reduce energy consumption—and corresponding —up to 44% compared to air-source heat pumps and up to 72% compared to electric resistance heating with stan-dard air-conditioning equipment.

Financing a GHP System

Many geothermal heat pump systems carry the DOE and EPA ENERGY STAR®label. ENERGY STAR®-labeled equipment can now be financed with special ENERGY STAR®loans from banks and other financial institutions. The goal of the loan program is to make ENERGY STAR®equipment easier to purchase, so these loans were created with attractive terms. Some loans have lower interest rates, longer repayment periods, or both. Ask your contractor about ENERGY STAR® loans or call the EPA's ENERGY STAR®toll-free hotline at 1-888-STAR-YES for a list of financing options.

Homeowners should also check with their utility and ask if they offer any rebates or special electric rate pro-grams. Another way to help finance the purchase of a GHP system is to roll the cost into an “energy-efficient mortgage” that would cover this and other energy-saving improvements to the home. The additional cost can be combined into the mortgage and will produce a positive cash flow. Banks and mortgage companies can provide more information on these types of loans.

DOE Spreads the Word about GHPs

In 1994, the U. S. Department of Energy (DOE), working closely with the EPA, Edison Electric Institute, Elec-tric Power Research Institute, International Ground Source Heat Pump Association (IGSHPA), National Rural Electric Cooperative Association, and industry, helped to create the Geot-hermal Heat Pump Consortium (GHPC). The GHPC launched the National Earth Comfort Program, designed to foster the development of a fast-growing, self-sustaining, national GHP industry infrastruc-ture. DOE has also supported research and development activities, especially through IGSHPA; the American Society of Heating, Refrigeration, and Air-Conditioning Engineers; the National Ground Water Association; and DOE's national laboratories. The work has targeted several areas of GHP technology, lowering the cost of ground heat exchangers, and developing advanced design software.

In partnership with the GHPC, DOE's Office of Geo-thermal Technologies seeks to increase annual installa-tions of GHP systems to about 400,000 by 2005 and reaching about 2 million installed (cumulative) that same year. Achieving the goal of 400,000 annual instal-lations by 2005 will save consumers over $400 million per year in energy bills and reduce U.S. gas emissions by over 1 million metric tons of carbon each year.

The System for the Future

With their high efficiency and user satisfaction, geo-thermal heat pumps are one option homeowners should consider. Not only will they save energy and money, they'll reduce emissions and provide indoor comfort at less cost to the environment.

Case Study—Minnesota

Located in the middle of Minnesota—where temperatures can range from 90°F (32.2°C) with 95% humidity in the summer to -18°F (-27.8°C) in the winter—Dennis Eichinger's 3,400-square-foot home averages a little over $44 per month in electricity bills.

The owner has been very satisfied with the unit's silence, high quality, reliability, and low maintenance. House guests also marvel at the comfort level of the house—they don't feel any drafts, just an even temperature throughout the house.

The five-ton ground source heat exchanger connects to five horizontal Slinky™ loops, totaling 3,000 feet of pipe, buried next to the home at a depth of eight feet (2.4 meters). GHP technology heats and cools as well as, or better than, conventional systems, even in Minnesota's extreme temperatures.

Case Study—Florida

Panama City, Florida, homeowner Keith Swilley partnered with his builder and local electric utility to create a 2,000-square-foot home that's a model of efficiency. It saves so much energy that the home won the 1997 Energy Value Housing Award for the custom home category for hot/humid climates at the National Association of Home Builders Conference in Houston.

Mr. Swilley used energy-efficient features from ceiling to floor, with cellulose insulation in the walls and attics, sealed ductwork, and efficient doors, windows, and lighting. However, the feature that saves the most energy is the GeoExchange system.

The geothermal heat pump heats and cools the house and provides hot water for the residents with a desu-perheater, which takes waste heat from the air-conditioning process and uses it in the water heater. The desuperheater actually helps the GeoExchange unit reach heightened levels of efficiency.

The system was metered separately and has proven to be a valuable investment, as the home's total energy bill for 2008 was $1231. Amazingly, only $343 of the total annual energy bill was used for heating and cooling the 2,000 square feet of conditioned space. “The energy bills are even lower than I anticipated,” said Mr. Swilley, “and the comfort level in the winter and summer is much greater than expected. I never dreamed I could heat and cool my home for 94 cents a day!”

For More Information

The following organizations serve as excellent for information on geothermal energy and its various applications.
U.S. Department of Energy (DOE)
Office of Geothermal Technologies, EE-12
1000 Independence Avenue, SW
Washington, DC 20585-0121
(202) 586-5340

Geo-Heat Center
Oregon Institute of Technology

3201 Campus Drive
Klamath Falls, OR 97601-8801
(503) 885-1750

Geothermal Heat Pump Consortium, Inc. (GHPC)
701 Pennsylvania Avenue
NW Washington, DC 20004-2696
(888) ALL-4-GEO (255-4436)

International Ground Source Heat Pump Association (IGSHPA)
490 Cordell South
Stillwater, OK 74078-8018
(405) 744-5175
(800) 626-4747