How much does geothermal heating cost to install?

Updated March 23, 2017

Geothermal heating and cooling systems are based on the temperature differential between an underground source and a building to be heated or cooled. Most people think of geothermal heating systems as tapping into an underground hot spring or something similar; but those type of geological formations are rare, and there are relatively few places where classic geothermal systems can be economically installed. However, geothermal heat pumps that involve laying a series of piping loops underground, removing the heat stored in the water of the pipes, and using it to heat a building have become technically feasible and can offer significant savings on utility bills.

Geothermal Heat Pumps

Geothermal heat pumps do not create heat by burning fuel or from any kind of combustion. During winter, geothermal heat pumps collect the natural underground heat through a series of pipes installed in loops below the surface of the ground or at the bottom of a pond. Fluid circulates around through the loops underground and picks up heat and carries it to the building. There, a compressor (usually electric) and a heat exchanger remove and concentrate the heat and release it inside the home.

Heating and Cooling

One of the great advantages of geothermal heat pump systems is the fact that they can heat during the winter and cool during the summer. In the summertime, 150 to 450 feet underground is much cooler than the surface temperature in most cases, so the fluid that circulates through these deep underground pipes will return to the building with a cold load that can be used to cool the building

Drilling Costs

Drilling costs for a geothermal pump system can run from £6,500 to £19,500, depending on the size of the system and the type of ground that has to be drilled. These drilling costs have to be added to the cost of the heat pump system when calculating the total cost of a geothermal heat pump installation.

System Cost

Geothermal heat pump systems cost around £1,625 to £1,950 per ton of capacity. Given that an average to somewhat larger home will require three tons of heating/cooling capacity, the cost comes to about £4,875 to £5,850 for the actual geothermal heat pump equipment.

Cost Comparison

Assuming average costs, the total cost of a three-ton geothermal heat pump system would be £5,362 for the heat pump and £9,750 for the drilling, for a total of £15,112. A traditional electrical heating and cooling system costs around £2,600 a ton, so an equivalent three-ton traditional heating/cooling system would cost around £7,800. However, keep in mind that the utility bills of homeowners with geothermal heat pump systems tend to average 20 to 30 per cent less than homeowners with traditional heat/cooling systems. Assuming a savings of £52 a month on your utilities, the extra £7,800 you paid up front for the geothermal pump system will be recouped in 13 years (and geothermal pump systems last 20 to 25 years, on average).

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About the Author

Clayton Browne has been writing professionally since 1994. He has written and edited everything from science fiction to semiconductor patents to dissertations in linguistics, having worked for Holt, Rinehart & Winston, Steck-Vaughn and The Psychological Corp. Browne has a Master of Science in linguistic anthropology from the University of Wisconsin-Milwaukee.