To Geothermal From Propane

[fishpick]

We changed over this fall and installed a geothermal system to replace our propane forced air heat.
I know I have seen a bunch of posts about wood, corn, oil, coal, etc here - so here's the complete picture of what we did for geothermal. Usually people who share this don't share the cost, which is the most frightening aspect... at first.

I can tell you we LOVE the geothermal system. Our hotwater cost is offset by the "excess" heat from the geo compressor... we have a grill, stove and then the balance of hotwater off the propane tank and from Oct to yesterday our propane fill was only 90 gallons... and that INCLUDES the "shrink" you get in the tank with the much colder ground in Dec.

The heat is super even, the electric bills are FRACTIONAL over the old propane bills, it's just great. Only "complaint" is the blower itself is louder because these units move more air than conventional furnaces - but that's trivial, really.

The hardest part has been the ongoing installation - the people we went with were not very good so they have ben out over and over and over and over... small things - but things I should not have "found".

The best part was the cost (really) - basically the system cost $25K (4 ton unit + field loops + everything inside)... but before you freak out (like we initially did - look at the math).
In 2011 (don't know if it's still around in 2012) - there's a 30% fed tax credit, so that's $8K coming back. We are in NY so there were no state credits or rebates - but other states have them.
When we bought the system NYSERDA (NY's energy research people) had a GREAT loan program in place it just made sense.
Here's the math:
We took out a GE capital 0% for 12 month bridge loan to cover the $8K we know we are getting back in the form of the tax credit - no cost of the money and for 4 months we just have to make on time payments of $201... not a big deal. Taxes get field, credit gets applied, we pay off the GE bridge loan. Done there in another 2 months.

That left $17K to deal with. That's where the 2.9% NYSERDA loan came in - 10 year term... payments ended up at $177 / month. We are paying extra principal on each payment (so total payment is $225). There's a reason for that.
When we put all the numbers together in terms of propane costs - we knew we were paying about $225 / month for propane over the course of the each year - with propane at $2.29/gallon - and the math worked out that the geothermal unit, at that price, gets paid off in 7 years with payments at that amount. (the recent propane fill was an insane $2.94 / gallon)
Bottom line - we pay $225 a month for 7 years - which is the SAME as locking in the $2.29/gal propane price - which is unrealistic - and after 7 years it's only the cost of the electricity.
So far - the unit seems to add all of $50 / month to our electric bills.

I share all the numbers so people who are looking into this can see (at least in 2011) it's a doable endeavor in terms of "normal people finance".

Here's the summary of payments:
We had $3000 "in the bank" for our anual propane pre-buy... So here's how it gets used to kick off this project:
First 4 months of the bridge loan = $201/month (then tax return pays this off with Fed credit)
7 years - each month $225 / month (pays off unit + install in 7 years at a propane rate = 2.29/gallon)
Unit operating costs (about $50-$70/month)

 

[wjmst]

"(the recent propane fill was an insane $2.94 / gallon)"

Hahaha, that is funny. My recent fill up was...... $5.12/gal by the time all of the nonsensical fees are added in.

Sounds like you got a pretty good setup. Make sure to post an update this spring and let us know how it performed.

 

[ch47dpilot]

How big is your house? 1 or 2 story? Planning on building in the next few years in Alabama. most people run heat pumps here but in the winter when it gets a little colder (10-20F) they are no longer that efficient and then you need to use back-up heat, Basically a giant electric toaster heating your house. Since the ground is always 60-70 geothermal would be perfect for the south where natural gas isn't used that much.

 

[bucktaker]

What is your supplemental heat source? Geo is only efficent to a certain temerature then needs a supplemental source gas or electric? have you inputed supplemental heat costs into your formula?

 

[charlz]

So how did the geo integrate with your existing forced air furnace? Did you have to replace the whole thing, just the 'propane burner' part, or was it 'add-on' where you can still use propane if you need?

If I had known more about geothermal at the time I might have gone that way instead of a pellet stove. No doubt the pay off would have been longer (pellet stove paid for itself in 4.5 years versus propane) but in the long run it would eliminate the 'sweat equity' part of a pellet stove (hauling pellets, filling stove twice a day etc.)

 

[soulasphil]

I used to heat the house with electric radiators in each room. I didn't go geothermal because I didn't know enough about it and the regulation to preserve the environment is too complicated. This summer I installed a pellet burner with ample storage space and hot water heating with heaters in each room. No need to handle pellets, they are blown into the silo then taken to the burner by a worm conveyor. Lots of hot water for the bathrooms too. Very comfortable, almost silent and much smaller electric bills.

 

[fishpick]

@ch47dpilot - We bought a 9 year old 2800 sq ft (monster) 2 story colonial several years ago - on the cheap.
@bucktaker - we considered a double plenum and keeping the propane for backup... but after the full manual-J calculation the unit can satisfy the house heat loss all the way down to 12F... so the number of days we need suplemental heat is like 3 - total. So we opted for a 220V AUX element in the unit. Geo is differnt than an air based heat pump because it can alwasy "make heat" from the 42 degree eath 6-7 feet down... so it's always making heat - the equation figures out when can the 44K BTU's it makes NOT satisify the building based on heat loss. The 3 times this year AUX has been needed (the thermostat logs to the web) - it's run for about 5-10 minutes total each time... and the temp has been single diget with wind. So the reality is, that is rather negligible. We had to go through the full NYSERDA energy audit to get the loan - and the sizing against that audit is very scientific. The way geo works - I would NEVER consider installing a system without the full on Energy Star house audit. Very little expectation to run that AUX a lot - all the time.
@charlz - the old furnace is in the barn waiting for me to get rid of it... the geo unit looks like a furnace and sits right where the old falme unit was. Hooks into the existing cold air and plenum. There are installations where you can retain your old furnace for supplemental / backup heat if you want. We opted not to because it was just "messy".

We looked at several flavors of large outdoor boilers... wood gasifiers, pellets, corn, you name it. I came to the conclusion (with the help of my wife) that having to "feed" something all the time to keep us warm was not a wise decision in terms of the mariage longevity... so - geo fit there really well.

The other side of that is the lifespan of any combustion pot is 10 years max... geo is good for 25 or so before you need to worry about the compressor part. So, my numbers were about the same as yours - 5 years for a pellet system... and then replace in another 5 after payoff... geo just made more sense for us longer term.

 

[71bronco]

Quote-------We took out a GE capital 0% for 12 month bridge loan to cover the $8K we know we are getting back in the form of the tax credit - no cost of the money and for 4 months we just have to make on time payments of $201... not a big deal. Taxes get field, credit gets applied, we pay off the GE bridge loan. Done there in another 2 months.

I don't know what your tax situation is but we couldn't apply the credit all in one year. We had to break it up over 3 years.

Jeff

 

[bucktaker]

fishpick
I thought ...from others info that geo needed supplemental heat at approx the same level as a air to air ...more or less . mine switches to back up propane at 29 degrees or > 2 degrees diff in set point and temp.....hummm gotta keep that inspection in mind

 

[fishpick]

Quote-------We took out a GE capital 0% for 12 month bridge loan to cover the $8K we know we are getting back in the form of the tax credit - no cost of the money and for 4 months we just have to make on time payments of $201... not a big deal. Taxes get field, credit gets applied, we pay off the GE bridge loan. Done there in another 2 months.

I don't know what your tax situation is but we couldn't apply the credit all in one year. We had to break it up over 3 years.

Jeff

According to our accountant - it's all good in one year as long as you are paying the taxes to get the cash back on the credit itself. i.e. - we pay more than $8K in Fed taxes so we can apply the full $8K credit.
(that may be a change as part of the "green jobs" legislation)

 

[fishpick]

I thought ...from others info that geo needed supplemental heat at approx the same level as a air to air ...more or less . mine switches to back up propane at 29 degrees or > 2 degrees diff in set point and temp.....hummm gotta keep that inspection in mind

Negative. That's why geo is a "better" heat pump than air to air.
With air to air - when the temp gets down around 20F, it's VERY VERY difficult for any unit to extract heat... there's something about a 40-50 degree temp differential is "doable" but other than that - the unit can't make heat. So if it's 20 outside and you have the house set to 70... you are off the high side by a fair amount and the unit can't satisfy - so it needs AUX heat because it can't produce enough BTU's.
So, I guess in a way that's true with geo - but the earth where the loop fileds reside (here) is a cool 42-45 degrees no matter what in the winter. So the laws of compressor physics still come into play (that whole 40 degree window) but the outside temp doesn't get to mess with things...
Where AUX heat comes in with geo is NOT when the heat pump can't make heat - it comes in when the heat made by the heat pump is leaving the structure faster than the unit can replenish it. (We have learned nuance is EVERYTHING with geo)

 

[71bronco]

According to our accountant - it's all good in one year as long as you are paying the taxes to get the cash back on the credit itself. i.e. - we pay more than $8K in Fed taxes so we can apply the full $8K credit.
(that may be a change as part of the "green jobs" legislation)

That's good for you. We had two 3 kids in college at the same time so we had some good credits the last couple years. By the way I love my geothermal.:thumbsup::thumbsup:

Jeff

 

[sawduster98]

Congrats on your system and welcome to the club! And BTW...which part of NY does NOT have high taxes???
We've had our system for 2yrs now and love it. 2 ton ClimateMaster. We were able to get our 30% back the first year.

 

[NorTracNY]

I looked into it, but I'm on natural gas. The payback is about 26years for me. If I was on propane it would have been closer to 14years.

 

[techman]

As fishpic pointed out, since the "source" never gets too cold, backup is generally not needed if the system is sized properly.

I have been on geo for 5 1/2 years and have not had 1 minute of backup heat. I actually installed a new thermostat this fall and tested the backup to check the wiring. It stunk up the house due to all of the dust that had accumulated on the electric coils over the years. I have the coils installed only for a system failure. I have also installed two other systems, both have never used backup.

The only downside is that the ground does slowly chill over the winter due to the heat flow capability of soil. So by the end of the heating season the water loop temps are down to about 28 deg on average, reducing efficiency somewhat at the end of the season. Despite adding a 4th person in my house (mother-in-law) and adding a computer or two, my annual electric consumption is 30% lower compared to my pre-geo days, with a conventional air-air hear pump system.

This year I added 9.2 KW of solar, so my current electric billing is dropping by about 50% to about $ 100/mo average, for an all electric 2800 sq-ft home.

paul

 

[wngsprd]

Let me add another positve vote for Geo. We installed in 1998 when we added on to our house. We doubled the sq ft but our heat bill didn't change. Unfortunately, the unit died in May this year and we replaced it with a better manufacturer. But the silver lining is that I now have an apples to apples comparison with the same sq ft and the new unit is so much more efficient our heat and A/C costs have dropped another 30%...and the tax credit is a nice deal sweetener.

 

[Island Farmer]

Let me add another positve vote for Geo. We installed in 1998 when we added on to our house. We doubled the sq ft but our heat bill didn't change. Unfortunately, the unit died in May this year and we replaced it with a better manufacturer. But the silver lining is that I now have an apples to apples comparison with the same sq ft and the new unit is so much more efficient our heat and A/C costs have dropped another 30%...and the tax credit is a nice deal sweetener.

Hello wngsprd,

What company manufactured your new unit? I have been thinking about changing over to geothermal for a long time. When I do it, I'd really like to get it right the first time.

Island Farmer

 

[jobguy]

I've had a geothermal ground water (85' well that supplies the house/furnace and discharges to a pond out back) since late 70's early eighties. I started with electric baseboard (killer electric bills over $300 even back then) and it only heated half the house (no heat to the basement)I paid $2400 for the original unit and $4000 for the upgrade unit. A local contractor built the original heat-pump in his garage. My total electric house electric bill averages $213 and we always get something back from the electric company every year. The well pumps have lasted about 12 years each. I upgraded the furnace once. The fan runs 24/7, keeps the house at an even heat and prevents moisture related mildew and cleans the air. My windows are original and not very efficient. We are going to sell and move to a warmer climate in the late summer or early fall so will never have to replace the unit again (I hope).
I love the unit. Fresh water to the pond brings in all kinds of wild-life.
So basically I have been happy with the unit.
I never ran cost or payback comparisons as I simply wanted what I think is the best heat source there is, in my home. Note: I live in MN even with 60-75 below wind-chill we have been toasty warm.

 

[heehaw]

my wifes uncle had a geothermal heatpump for years, as jobguy does: dumped the well water in a pond or on his garden: a couple years ago it quit working so he replaced it with a high eff heat pump: and his utilities went down: for a "poor mans geothermal" air conditioning system, put a water line to your compressor/condensor, and an electric valve with a misting tip, when the ac comes on, it will mist the outside unit: we had to do this at my sisters house last summer, because the outside temp was so high, the unit would not work: this solved the problem instantly:
heehaw

 

[Richard]

The heat is super even, the electric bills are FRACTIONAL over the old propane bills, it's just great.

Let's put it into some simple perspective.

My house is approximately 3,000 sq/ft and I heat with electricity. During winter, I have three installed propane ventless fireplaces however, we only use one of them.

My neighbor has a house about 12,000 sq/ft (yes 4x larger) than mine.

I was preparing for a HVAC service and possible expensive bill so I went to the neighbor to talk to him about his Geothermal installation.

He too, LOVES it.

My electricty bill during a winter month was between $300/400 for the month.

My dirty low down son of a gun neighbor actually pulled his electricity bill out and showed it to me. It was about $120.

His house is FAR more comfortable than mine, they run FAR more lights than I do and I'm paying three times his price during heating season.

I've never had the nerve to check during cooling months, I'm already mad at him