How Much Does Geothermal Heating Cost?

The very first thing that should be mentioned when talking about the cost of geothermal heating is that it can help you reduce your overall utility fees by up to 60% annually. Let that sink in for a second. If your annual heating bill hypothetically comes to $1,000, by installing a geothermal heating system, you could knock $600 off that bill.

Yes, geothermal heating systems are as efficient as these things get. The best in the market offers an incredible 300 - 600% efficiency rating which is why they can help you save so much regarding billing as well as your impact on the environment.

You might be wondering: if geothermal energy is so great - they help you save money and the environment too - then why don't more people have geothermal heating systems installed? That is a good question, the answer to which is in two parts:

  • Most people do not know about it
  • The initial costs can be a little scary

It is the second answer that we want to focus on today: just how much does geothermal heating cost?

What is the Cost of Geothermal Heating?

Unlike most other heating systems, geothermal heating systems do not burn oil or gas to produce heat. Instead, they utilize heat energy from within the Earth's crust. Here, temperatures remain at a steady 45 - 75 degrees Fahrenheit whether it snows or not.

By making use of a very small amount of electricity, geothermal heat pump systems pump water through a network of pipes placed underground. The fluids pumped through these underground pipes absorb the natural underground heat and transfer that back to the surface.

An above-ground heat exchanger then uses that transferred heat energy to warm up air. This warmed air is transferred through your house using a series of ducts. Since this system produces more energy than it consumes, it can easily achieve and exceed 100% efficiency.

What are the Upfront Costs?

This is where the problems come into the equation. Even though geothermal heating systems are incredibly efficient and eventually cost effective, it is the upfront costs that deter most people from getting them installed. Let’s put these costs into perspective:

The average home needs a heating and cooling capacity of about one to five tons depending on the size of the house, the insulation quality and the overall construction. According to the National Geographic geothermal heating costs about $5,000 - $9,000 compared to traditional heating systems that cost about $3,000 per ton.

What are the Upfront Costs

So how much will it cost you to have a geothermal system installed?The costs vary depending on a number of factors including:

  • Soil conditions on your compound: Some soil types are just ideal for these types of Earth loop systems while there are those that make it very difficult to install the system. The kind of soil you have in your compound will determine just how much extra work is needed to install your geothermal system properly.
  • System configuration: Of course, just because you have an average sized home doesn't necessarily mean that you will want to have an average geothermal heating system installed. You might require a more powerful system because you live in a very cold part of the country. These specifications also play a role in determining how much your overall system installation cost will be.
  • Plot size: On average, a 3-ton system should be enough to heat the average home but the bigger your home,the bigger the system needed to heat it up sufficiently,and that translates to a higher upfront cost for your geothermal heating system.
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    Site accessibility and local geology: These systems require a great deal of excavation and Earth loop piping. As such, your local geology needs to be able to support that kind of activity. A site inspection will be necessary to determine this as well as the overall cost.

All of these factors will determine just how much digging and drilling will be required to properly set up the system. On average, the cost to have a geothermal heating system set up in your home should come to anything between $10,000 - $30,000.

Usually, for a 2,000-sq ft. home, the costs fall between $10,000 and $20,000. Having a geothermal system installed in your home will cost you about 40% more than a typical HVAC system.

The Life Expectancy of Geothermal Systems

A real concern for most homeowners considering installing geothermal heating systems in their homes would be just how difficult it would be to maintain those underground pipes. Fortunately, these underground components usually come with 25 - 50-year warranties; the pumps come with 20-year warranties.

The good thing is that this system, once properly installed, does not require that much maintenance. You will, however, need to hold routine filter inspections and changes. You will also need a professional to occasionally inspect the entire system to make sure that all components are functioning properly and at an optimum level.

Rebates and Incentives Involved

There is a wide variety of federal, state and local financing incentives and rebates available for people looking to have geothermal heating systems installed in their homes. One of the best places to start would be at the "Database of State Incentives for Renewables & Efficiency" website. On estimate, the total incentives and rebates you can get for installing a geothermal system in your home could come to about 30-60% of the overall cost.

While it might sound to many like the initial costs are exceedingly high, you should know that this kind of system typically pays for itself in just 5-6 years. Given most of them have a lifespan of about 50 years depending on maintenance, and the fact that you could be saving up 60% of your utility costs each year, after the first 5 - 6 years you will be earning money back for several decades that follow. That and geothermal energy is much cleaner, more efficient and environmentally friendlier than your typical HVAC.

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