When we bring up the topic of geothermal HVAC with most homeowners, the first thing they ask is how much it’ll cost. This is because geothermal HVAC systems have a reputation for being quite expensive. However, upfront costs alone aren’t necessarily the best way to evaluate the viability of geothermal as an HVAC option here in Bellevue, NE. Instead, it’s necessary to examine both sides of the ledger—total costs and savings—to come up with an accurate viability assessment. Here’s everything you need to know about the economics of geothermal HVAC.
The Costs of Geothermal HVAC
Any way you look at it, geothermal HVAC systems are more expensive than other air conditioning and heating options. The reason is simple. Geothermal systems require extensive underground pipe loops that other systems don’t need. Installing those pipe systems is where most of the upfront cost of a geothermal system lies. There are two main types of underground pipe systems used by geothermal HVAC systems.
The first is a horizontal loop system. This requires a significant amount of property that some homes don’t have. To install a horizontal loop, the installer would dig a long, approximately 5-foot-deep trench, to accommodate the needed pipes. This provides enough room for the system to harvest heat in the winter and expel heat in the summer. On average, you can expect a horizontal loop system to cost between $15,000 and $34,000, depending on the size system your home needs.
The next type is a vertical loop system. This space-saving installation method relies on much deeper pipe installation in a hole that’s between 100 and 400 feet deep. It makes up for the lack of horizontal pipe length by going deeper instead. Unfortunately, this can add significantly to the price, with vertical loop installations costing between $20,000 and $38,000.
For comparison, the average new HVAC system will cost a homeowner about $7,500. However, geothermal systems have massive cost benefits after installation that conventional systems don’t.
Geothermal HVAC Savings
The first thing you should know about the savings you can expect from a geothermal system is that they feature unbeatable efficiency. According to the US Department of Energy, the average geothermal HVAC system uses half the energy of the systems it replaces. In the winter, you’ll see maximum savings because a geothermal HVAC system can shave up to 70% off of your heating costs. And in the summer, it can reduce your cooling costs by up to 50%.
In most homes, the savings mean that a geothermal HVAC system will pay for itself within 10 years. And, if you also upgrade your home’s insulation at the same time, it will happen even faster than that. However, there are other hidden benefits associated with installing a geothermal HVAC system.
One is that a geothermal heat pump should last you for 20 years, which is twice its payback period. This is in comparison to a traditional HVAC system with a lifespan of 10-15 years. The pipe loops of your new geothermal system can last up to 50 years. That means you will typically buy two standard HVAC systems during the lifespan of one geothermal system and the cooling loops will work for at least two heat pump replacements.
As of 2023, geothermal HVAC systems qualify for a 30% federal tax credit. It’s a non-refundable credit, which means that you can apply a portion of it to eliminate any taxes you owe year after year until you’ve reached 30% of your system’s costs. If you have more savings than taxes due, the remaining tax reduction will carry over into future years.
Geothermal Makes a Good Investment
When you look at the broader economic picture associated with installing a geothermal HVAC system in your home, the upfront costs don’t seem as daunting. And if you work with the experts here at Apollo Heating & Air Conditioning to get a geothermal system installed, you’ll benefit even more! Our family-owned and operated company has served the Bellevue area since 1971, offering comprehensive HVAC installation, maintenance, and repair services. We also handle commercial HVAC, indoor air quality, and ductwork services, too. We even offer flexible finance options on approved credit, which make paying for something like a geothermal HVAC system much easier. For geothermal HVAC systems and more, contact Apollo Heating & Air Conditioning today!
