Renewable Energy: Geothermal Ground Source Heat Pumps

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By Anne Vazquez
Published in the January 2010 issue of Today’s Facility Manager

As more facility managers (fms) consider the use of renewable energy, it important they evaluate the various source types (e.g., geothermal, solar, wind). While each situation will be different, fms can keep several aspects in mind during the evaluation and decision making process. Questions to consider include: What do we want to gain with renewable energy (e.g., increase sustainability, reduce utility costs)? Can our site/building accommodate the physical infrastructure? What are the costs/savings, and what financing options are available to us? And what do we need to know to maintain the system?

Geothermal energy is heat from the earth that, when harnessed, can be used by power plants to provide electricity. It can also be captured by individual organizations for on-site heating, cooling, and hot water needs.

The latter option of on-site energy production involves a facility using a ground source heat pump (GSHP) system. A GSHP is an electrically powered piece of equipment that taps the energy of the earth, drawing it out via a piping system.geothermal renewable energy facility management environment (The illustration shown here is a vertical loop system.)

Using this heat from the earth, which is then mixed with a water based or antifreeze solution, facilities significantly reduce the energy consumed from their utility. While most system designs do require energy from a traditional source (e.g., their utility) to power the pumps and, in some cases, a boiler or chiller, geothermal energy does the rest.

Working with a qualified contractor, fms can determine the most suitable type of GSHP installation. Dr. James Bose, Ph.D., P.E., executive director of the International Ground Source Heat Pump Association (IGSHPA) in Stillwater, OK, advises, “Facility managers should find a service provider who is experienced and is working with a good product. You don’t want this to be a research project.”

Providing training programs for installers is a prime issue for IGSHPA, specifically for those who fuse the system piping. “Very rarely is there a leak in piping,” says Bose, “but the pipe is warrantied for 50 years, with an expected life of 200 years, so this is a critical aspect.”

Fms may be concerned with financing a GSHP installation, since first costs can be expected to be more than a conventional heating and cooling system. Organizations that pay taxes (as opposed to schools and non-profit entities) should look for incentives offered by federal, state, and local governments, as well as by their utility companies.

At the federal level, the Emergency Economic Stabilization Act introduced an incentive that went into effect October 3, 2008. Through 2016, it provides commercial facilities an investment tax credit of 10% of the installed cost of a geothermal system. In lieu of the tax credit, fms can access the American Recovery & Reinvestment Act (ARRA), which enables them to take a grant worth 10% of the installed costs for equipment placed in service during 2009 and 2010.

“The legislation is not one size fits all,” says Bose. “For instance, the tax credits won’t work for a school, since they don’t pay taxes. School boards I’ve spoken to are in a situation where they understand the gains from geothermal, but they don’t have the first cost money available. So many decide to ask for the funds when the next bond issue goes out, and they present justification for receiving those additional resources.”

Also included in the October 2008 legislation was an extension of the Energy Efficient Commercial Building Tax Deduction. Previously introduced in 2005, it enables facilities to take a deduction of 60¢ per square foot for reducing energy used for HVAC/hot water systems by 20% (compared to the minimum requirements of ASHRAE Standard 90.1-2001).

In evaluating renewable energy, fms will find pros and cons with each type. By identifying what the facility’s goals and capabilities are and investigating where advantages lie, fms can bring their organizations into the next era of energy use.


This article was based, in part, on an interview with Bose. For more information from the IGSHPA, visit www.igshpa.okstate.edu. Another useful source is the Geothermal Energy Association (www.geo-energy.org/).

What is your experience with geothermal? Do you have questions about implementing this energy source? Send an e-mail to [email protected].

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