Total Cost Breakdown
This post provides the complete all-in costs for installing a WaterFurnace Series 7 ground source heat pump (closed loop) in 2021 for our home with full spreadsheet.
Hoping this information helps someone considering a similar project, or just comparing ground versus air-source heat pump costs & ROI. Air-source will always give quicker ROI, speed and ease of installation but ground source gives higher efficiency and longer term lower running costs.
Geothermal First
We did geothermal first so we could accurately size our planned for future solar system to power everything in the house.
Google Drive Attachments
Geothermal Project Total Cost Spreadsheet
Quarter Wavelength Absorption (sound analysis)
Google Sheets will display the above spreadsheets but there are some "N/A errors" with CONCAT functions. If you download the spreadsheets and view them in Microsoft Excel these errors go away and things display correctly. Everything is virus scanned and clean.
Soundbox Photos
Vibration Damping
Low Temperature 2F (-17C)
Return on Investment
The return was calculated over 30 years as we intend to retire in our current home.
Around a 20-year return period – in our case, given all work done outside of the geothermal installation itself. The return period should be much shorter without this additional work.
The quickest return on investment will always be with an air-source geothermal unit, over ground source, as you don’t have the well drilling costs. That said, having had an air-source heat pump in our last home, we wanted ground-source for higher efficiency, offsetting the higher cost. We see the investment as paying off in the long term and helping the environment, a combined goal of ours.
Costs
The attached cost spreadsheet for our WaterFurnace Series 7, ground source (closed loop) geothermal system, gives the actual costs for anyone who is interested in exploring this option.
The cost figures are as of 2021, in eastern Pennsylvania USA, with federal tax rebates (26%). Currently in 2024 there is a federal tax rebate (30%). There may be additional local state incentives or rebates, or in other countries if you live abroad. Costs in your area will likely vary from our numbers but it gives a ballpark as of 2021.
$65,205 – Total upfront costs, before tax rebates.
$53,287 – Total adjusted cost, after tax rebates.
$40,642 – Adjusted cost, (removing non-essential items), after tax rebates.
If you remove the new generator, water treatment and furnace sound proofing (likely unnecessary for most people).
Savings
$2,064 – Annual savings on average, compared to our oil furnace.
$2,786 – Annual savings on average, when oil prices are high.
The savings vary with the oil and electricity rate changes over time.
In the future, once we have solar installed, covering nearly all power needs, then the savings will be even greater with the removal of nearly all electrical costs. Granted you must pay off your solar system investment, but once paid off, then heating and cooling via electricity is essentially free at that point.
Geothermal and solar investments are the long-term factors determining savings over time.
You can look at solar as a pre-payment for future electrical costs. After a certain time, you start winning/saving over what you otherwise would have paid. Geothermal costs less to run than oil. We are acting in both our financial and environmental interests combined. Helping to save the planet’s environment is priceless for everyone.
Lessons Learned
Happy to answer any questions people have on the project.
Alastair
This post provides the complete all-in costs for installing a WaterFurnace Series 7 ground source heat pump (closed loop) in 2021 for our home with full spreadsheet.
Hoping this information helps someone considering a similar project, or just comparing ground versus air-source heat pump costs & ROI. Air-source will always give quicker ROI, speed and ease of installation but ground source gives higher efficiency and longer term lower running costs.
Geothermal First
We did geothermal first so we could accurately size our planned for future solar system to power everything in the house.
Google Drive Attachments
Geothermal Project Total Cost Spreadsheet
Quarter Wavelength Absorption (sound analysis)
Google Sheets will display the above spreadsheets but there are some "N/A errors" with CONCAT functions. If you download the spreadsheets and view them in Microsoft Excel these errors go away and things display correctly. Everything is virus scanned and clean.
Soundbox Photos
Vibration Damping
Low Temperature 2F (-17C)
Return on Investment
The return was calculated over 30 years as we intend to retire in our current home.
Around a 20-year return period – in our case, given all work done outside of the geothermal installation itself. The return period should be much shorter without this additional work.
The quickest return on investment will always be with an air-source geothermal unit, over ground source, as you don’t have the well drilling costs. That said, having had an air-source heat pump in our last home, we wanted ground-source for higher efficiency, offsetting the higher cost. We see the investment as paying off in the long term and helping the environment, a combined goal of ours.
Costs
The attached cost spreadsheet for our WaterFurnace Series 7, ground source (closed loop) geothermal system, gives the actual costs for anyone who is interested in exploring this option.
The cost figures are as of 2021, in eastern Pennsylvania USA, with federal tax rebates (26%). Currently in 2024 there is a federal tax rebate (30%). There may be additional local state incentives or rebates, or in other countries if you live abroad. Costs in your area will likely vary from our numbers but it gives a ballpark as of 2021.
$65,205 – Total upfront costs, before tax rebates.
$53,287 – Total adjusted cost, after tax rebates.
$40,642 – Adjusted cost, (removing non-essential items), after tax rebates.
If you remove the new generator, water treatment and furnace sound proofing (likely unnecessary for most people).
Savings
$2,064 – Annual savings on average, compared to our oil furnace.
$2,786 – Annual savings on average, when oil prices are high.
The savings vary with the oil and electricity rate changes over time.
In the future, once we have solar installed, covering nearly all power needs, then the savings will be even greater with the removal of nearly all electrical costs. Granted you must pay off your solar system investment, but once paid off, then heating and cooling via electricity is essentially free at that point.
Geothermal and solar investments are the long-term factors determining savings over time.
You can look at solar as a pre-payment for future electrical costs. After a certain time, you start winning/saving over what you otherwise would have paid. Geothermal costs less to run than oil. We are acting in both our financial and environmental interests combined. Helping to save the planet’s environment is priceless for everyone.
Lessons Learned
- Do not position your unit in the basement, directly under your bedroom, where our oil furnace used to be. The noise and vibration kept us awake till we sorted it out. The sound is constantly variable, being a super-efficient unit, ramping up and down, but when it’s directly under your bedroom it annoys. I analyzed the sound frequencies, then self-designed and built a sound box around the unit giving a 95% reduction in sound transmission so we could sleep peacefully.
- Be sure to vibration isolate the furnace from the floor mounts, and vibration isolate the ground loop pipes where they attach to the ceiling/floor joists of the room above, to reduce vibration being passed into the house structure. This was not done by our installer, and we had to retrofit these solutions ourselves after researching the issue.
- The geothermal system inherited the oil furnace single zone air duct system. You need to put in at least two zones for a two-floor home (our home is Cape Cod style) as the upper floor temperature is either too hot or too cold with just the single zone we installed. This was true previously with the oil heating’s single zone setup. The Series 7 can handle multiple zones, a reason we went for this unit over the Series 5, to be able to add future zones when we can afford to do so.
- Looking to put in three zones in the future, redoing all our ductwork, (1) master bedroom, (2) downstairs (3) upstairs. We decided we need a third zone for the master bedroom, to allow us to better control (lower) nighttime temperatures without having to lower the whole house’s temperatures. Geothermal units run most efficiently when maintaining a temperature, rather than doing large temperature swings. Isolating the master bedroom allows us to just cool/heat a smaller space with larger temperature swings. This is less strain on the system and less cost for a lower night sleeping temperature.
- Ductwork sized for the existing oil furnace may not be appropriately sized for a geothermal system. The Manual J calculation said the existing ductwork had enough capacity, but the more powerful fan and less hot furnace exit air temperatures 80/90F (geothermal) rather than 120F (oil) meant the duct air flow was sped up to achieve the needed air exchanges to keep setpoint room temperature. This causes a louder roaring sound in the registers than what we had with oil heat. By increasing the number of supply/return registers, and increasing the size (air flow volume) of the ductwork should slow down the speed of air flow in the future once the duct rebuild is completed.
- If using a well, you may need to add a water treatment system to stop mineral build up in the hot water, secondary loop, running to the desuperheater. This loop gets fed by our regular well water. Our plumber also recommended an iron breaker unit as well as a scale prep (demineralization through suspension, not using salt), both of which we installed. If you already have water treatment systems in place you likely won’t need these but be aware they were recommended.
- The water in the closed ground closed loop was pretreated one time by the installer, so as not to clog up the furnace heat exchanger and have anti-freeze properties in the ground. This should not need further treatment unless there is a problem over time.
- Insulate the house as much as possible before any installation to lower the size unit needed to power your home. Reducing the well size, lowers the drilling cost.
- Had to replace our Honda EU7000is (7kW) portable generator with a whole home Briggs & Stratton 20kW generator to have sufficient amperage to run the geothermal unit in a power out situation, plus cover built-in emergency strip heat if the compressor ever died.
- Allow money for soil grading and reseeding the lawn after the drilling rig has finished. Our intention was to do this work ourselves but with the heavy shale, rock-filled soil we had to purchase new topsoil and employed a landscape company to take care of the heavy work with machinery.
- We took the opportunity of installing underground roof drainage at the same time as the soil work to help with the increased rainfall in our area, causing flooding in our basement. We also put in a sump pump and may add a second as backup. These costs were not directly related to the installation but made sense during the groundwork phase, hooking sump pump in in-ground drainage.
- Our well driller recommended drilling an extra ton of well capacity to reduce/remove the need for calling supplemental heat. This was a wise choice as we don’t need it even at 2F (-17C) temperatures, the lowest it has dropped so far for us in the last two years. If you want rapid temperature gains (more than 2F degrees at a time) then supplemental heat will kick in, to speed things up. We program our unit to gradually increase temperature from night to daytime to avoid kicking supplemental heat on in the mornings.
- The unit is super-efficient and so far, reliable after an expansion valve replacement under warranty, right at the beginning, the only repair needed to date.
- The furnace controls the humidifier unit. The built-in control panel humidity sensor is a little off in its readings, but you just increase the setting a little to compensate which kicks on the whole home humidifier unit, installed in the return ductwork by the furnace.
Happy to answer any questions people have on the project.
Alastair
