If you’re planning to build a new house,

office building, or school, or replace your

heating and cooling system, you may

want to consider a geothermal heat pump

(GHP) system. GHP systems are also

known as GeoExchangeSM, ground-source,

or water-source heat pumps (as opposed

to air-source heat pumps). Regardless of

what you call them, energy-efficient geothermal heat pumps are available today

for both residential and commercial building applications. 

A GHP system can be installed in virtually

any area of the country and will save

energy and money. According to the Environmental Protection Agency (EPA), GeoExchange systems are the most energy

efficient, environmentally clean, and costeffective space conditioning systems available (source: “Space Conditioning: The Next

Frontier,” EPA 430-R-93-004, April 1993).

While residential GHP systems are usually more expensive initially to install

than other heating and cooling systems, 

their greater efficiency means the investment can be recouped in two to ten years.

After that, energy and maintenance costs

are much less than conventional heating

and air-conditioning systems. 

When GHP systems are installed in commercial buildings, the state-of-the-art

designs are extremely competitive on upfront costs when compared with cooling

towers and boilers, and they have lower

energy and maintenance costs. 

In addition to their cost effectiveness,

GHP systems offer aesthetic advantages,

quiet operation, free or reduced-cost hot

water, improved comfort, and a host of

other benefits. 

What Is a Geothermal 

Heat Pump?

Geothermal heat pumps are viable nationwide. They use the Earth as a heat sink in

the summer and a heat source in the winter, and therefore rely on the relative 

warmth of the earth for

their heating and cooling production.

Through a system of

underground (or

underwater) pipes,

they transfer heat from

the warmer earth or

water source to the

building in the winter,

and take the heat from

the building in the

summer and discharge

it into the cooler

ground. Therefore,

GHPs don’t create heat;

they move it from one

area to another. 

C

Geothermal Heat Pumps

LEARI

NGHOUSE

ENERGY

EFFICIENCY AND

RENEWABLE

ENERGY

T OF ENERGY

DEPARTMEN

U

E

NITED STAT S OF A

ERICA

M

For a home of 1,500 square feet with a good building envelope and

a geothermal heat pump, energy costs are about one dollar a day.

This document was produced for the U.S. Department of Energy (DOE) by the National Renewable Energy Laboratory (NREL), a DOE national laboratory. The

document was produced by the Technical Information Program, under the DOE Office of Energy Efficiency and Renewable Energy. The Energy Efficiency and

Renewable Energy Clearinghouse (EREC) is operated by NCI Information Systems, Inc., for NREL / DOE. The statements contained herein are based on information known to EREC and NREL at the time of printing. No recommendation or endorsement of any product or service is implied if mentioned by EREC.

Printed with a renewable-source ink on paper containing at least 50% wastepaper, including 20% postconsumer waste

DOE/GO-10098-652

FS 105

September 1998

Warren Gretz, NREL/PIX06534
How Do They Work? 

Simply put, a GHP works much like the

refrigerator in your kitchen, with the addition of a few extra valves that allow heatexchange fluid to follow two different

paths: one for heating and one for cooling.

The GHP takes heat from a warm area and

exchanges the heat to a cooler area, and

vice versa. The beauty of such a system is

that it can be used for both heating and

cooling—doing away with the need for

separate furnace and air-conditioning systems—and for free hot water heating during the summer months. For a more

detailed explanation of how GHP systems

work, see the sidebar on page 5. 

Benefits of a GHP System

Low Energy Use

The biggest benefit of GHPs is that they

use 25-50% less electricity than conventional heating or cooling systems. This

translates into a GHP using one unit of

electricity to move three units of heat 

from the earth. According to a report by

Oak Ridge National Laboratory, statistically valid findings show that the 4,003-

unit GHP retrofit project at Fort Polk,

Louisiana, will save 25.8 million kilowatthours (kWh) in a typical meteorological

year, or 32.5% of the pre-retrofit wholecommunity electrical consumption. This

translates to an average annual savings of

6,445 kWh per housing unit. In addition,

100% of the whole-community natural gas

previously used for space conditioning

and water heating (260,000 therms) will be

saved. In housing units that were all-electric in the pre-retrofit period, the GHPs

were found to save about 42% of the preretrofit electrical consumption for heating,

cooling, and water heating.

Free or Reduced-Cost Hot Water

Unlike any other heating and cooling system, a geothermal heat pump can provide

free hot water. A device called a “desuperheater” transfers excess heat from the heat

pump’s compressor to the hot water tank.

In the summer, hot water is provided free;

in the winter, water heating costs are cut

roughly in half. 

Year-Round Comfort

While producing lower heating bills, geothermal heat pumps are quieter than conventional systems and improve humidity

control. These features help explain why

customer surveys regularly show high

levels of user satisfaction, usually well

over 90 percent. 

Design Features 

Geothermal heat pump systems allow for

design flexibility and can be installed in

both new and retrofit situations. Because

the hardware requires less space than 

that needed by conventional HVAC systems, the equipment rooms can be greatly

scaled down in size, freeing space for productive use. 

And, geothermal heat pump systems usually use the existing ductwork in the

building and provide simultaneous heating and cooling without the need for a

four-pipe system.

Improved Aesthetics

Architects and building owners like the

design flexibility offered by GHPs. Historic buildings like the Oklahoma State

Capital and some Williamsburg structures

use GHPs because they are easy to use in

retrofit situations and easy to conceal, as

they don't require cooling towers. 

GHP systems eliminate conventional rooftop equipment, allowing for more aesthetically pleasing architectural designs and

roof lines. The lack of roof top penetrations also means less potential for leaks

and on-going maintenance, and better roof

warranties. In addition, the above-ground

components of a GHP system are inside

the building, sheltering the equipment

both from weather-related damage and

potential vandalism. 

Low Environmental Impact

Because a GHP system is so efficient, it

uses a lot less energy to maintain comfortable indoor temperatures. This means that

less energy—often created from burning

fossil fuels—is needed to operate a GHP.

According to the EPA, geothermal heat

pumps can reduce energy consumption—

and corresponding emissions—up to 44%

compared to air-source heat pumps and 

2

Geothermal heat

pumps can reduce

energy consumption—and corresponding air pollution

emissions—up 

to 44% compared 

to air source heat

pumps and up to 

72% compared to

electric resistance

heating with standard 

air-conditioning

equipment. 

(Source: EPA, 1993)
up to 72% compared to electric resistance

heating with standard air-conditioning

equipment. 

Low Maintenance

According to a study completed for the

Geothermal Heat Pump Consortium

(GHPC), buildings with GHP systems had

average total maintenance costs ranging

from 6 to 11 cents per square foot, or about

one-third that of conventional systems.

Because the workhorse part of the system—the piping—is underground or

underwater, there is little maintenance

required. Occasional cleaning of the heat

exchanger coils and regularly changing the

air filters are about all the work necessary

to keep the system in good running order.

Zone Heating and Cooling 

These systems provide excellent “zone”

space conditioning. With this, different

areas of the building can be heated or

cooled to different temperatures simultaneously. For example, GHP systems can

easily move heat from computer rooms

(which need constant cooling) to the

perimeter walls for winter heating in commercial buildings. School officials like the

flexibility of heating or cooling just auditoriums or gymnasiums for special

events—rather than the entire school. 

Durability

Because GHP systems

have relatively few

moving parts, and

because those parts

are sheltered inside 

a building, they are

durable and highly

reliable. The underground piping often

carries warranties of

25 to 50 years, and

the GHPs often last

20 years or more. 

Reduced Vandalism

GHPs usually have

no outdoor compressors or cooling

towers, so the potential for vandalism is 

eliminated.

Installation

Because of the technical knowledge and

equipment needed to properly install the

piping, GHP system installations are not a

do-it-yourself project.

To find a qualified installer, call your 

local utility company, the International

Ground Source Heat Pump Association

(IGSHPA—see Source List), or the Geothermal Heat Pump Consortium (GHPC—see

Source List) for their listing of qualified

installers in your area. Installers should be

certified and experienced. Ask for references, especially for owners of systems

that are several years old, and check them.

How GHPs Are Labeled

GHP efficiency is rated in two ways. The

Coefficient of Performance, or COP, and

Energy Efficiency Rating, or EER, are measures of heating and cooling efficiency,

respectively. 

Manufacturers of high-efficiency geothermal heat pumps voluntarily use the EPA

ENERGY STAR® label on qualifying equipment and related product literature. If you

are purchasing a geothermal heat pump

and uncertain whether it meets ENERGY

STAR® qualifications, ask for an efficiency

rating of at least 2.8 COP or 13 EER. 

3

Geothermal heat pump

Std. gas/Std. AC

Burlington, VT Chicago, IL New York, NY Portland, OR Atlanta, GA Phoenix, AZ

Std. air-source heat pump

Advanced gas/Hi-eff. AC

Advanced air-source heat pump

Gas-fired heat pump

14

Annual Carbon Dioxide Emissions from Space Conditioning Equipment by Region

(in thousands of kilograms per year)

12

10

8

6

4

2

0

GHP systems have the lowest carbon dioxide emissions of all the heating and cooling technologies.

A GHP system can 

be installed in virtually any area of the

country and will save

energy and money.

Source: EPA, 1993
Financing a GHP System

Many geothermal heat pump systems

carry the U.S. Department of Energy

(DOE) and EPA ENERGY STAR® label.

ENERGY STAR®-labeled equipment can

now be financed with special ENERGY

STAR® loans from banks and other financial institutions. The goal of the loan program is to make ENERGY STAR®

equipment easier to purchase, so ENERGY

STAR® loans were created with attractive

terms. Some loans have lower interest

rates, longer repayment periods, or both.

Ask your contractor about ENERGY

STAR® loans or call the ENERGY STAR®

toll-free hotline at 1-888-STAR-YES for a

list of financing options.

Homeowners should check with their utility and ask if they offer any rebates,

financing, or special electric rate programs. Another way to help finance the

purchase of a GHP system is to roll the

cost into an “energy-efficient mortgage”

that would cover this and other energysaving improvements to the home. Banks

and mortgage companies can provide

more information on these loans. 

These mortgages can create positive cash

flow from the start. Say that installing a

geothermal heat pump system adds $25

per month to the mortgage. However,

because a GHP system is so efficient, it

will save more than $30 per month in

energy costs.

DOE Spreads the Word 

about GHPs

In 1994, DOE, working closely with the

Environmental Protection Agency, Edison

Electric Institute, Electric Power Research

Institute, International Ground Source

Heat Pump Association (IGSHPA),

National Rural Electric Cooperative Association, and industry, helped to create the

Geothermal Heat Pump Consortium

(GHPC). The GHPC launched the National

Earth Comfort Program, designed to foster

the development of a fast-growing, selfsustaining, national GHP industry infrastructure. DOE has also supported research

and development activities, especially

through IGSHPA; the American Society of

Heating, Refrigeration, and Air-Conditioning Engineers; the National Ground

Water Association; and DOE’s national

laboratories. The work has targeted several areas of GHP technology, lowering

the cost of ground heat exchangers, and

developing advanced design software.

In partnership with the GHPC, DOE’s

Office of Geothermal Technologies seeks

to increase annual installations of GHP

systems to about 400,000 by 2005 and

reaching about 2 million installed (cumulative) that same year. Achieving the goal

of 400,000 annual installations by 2005 will

save consumers over $400 million per year

in energy bills and reduce U.S. greenhouse

gas emissions by over 1 million metric

tons of carbon each year. 

Install a GHP and Forget about

High Energy Bills

With a geothermal heat pump system,

you’ll experience greater indoor comfort,

lower energy bills, and a system that provides heating, cooling, and hot water for

many trouble-free years to come.

4

Annual Heating and Cooling Costs by Region

Phoenix, AZ Burlington, VT Atlanta, GA New York, NY Chicago, IL Portland, OR

$1500

1200

900

600

300

0

Geothermal heat pump

Gas furnace with central air

Air source heat pump

Oil furnace with central air

A GHP system can lower heating and cooling costs in all areas of the country.

GHP systems have

average total maintenance costs ranging

from 6 to 11 cents per

square foot, or about

one-third that of 

conventional systems.

Source: EPA, 1993
5

How Does a GHP System Work?

The ground heat exchanger in a GHP system is made up of 

a closed or open loop pipe system. Most common is the closed

loop, in which high density polyethylene pipe is buried horizontally at 4-6 feet deep or vertically at 100 to 400 feet deep.

These pipes are filled with an environmentally friendly

antifreeze/water solution that acts as a heat exchanger. In 

the winter, the fluid in the pipes extracts heat from the earth

and carries it into the building. In the summer, the system

reverses and takes heat from the building and deposits it to 

the cooler ground. 

The air delivery ductwork distributes the heated or cooled air

through the house’s duct work, just like conventional systems.

The box that contains the indoor coil and fan is sometimes

called the air handler because it moves house air through the

heat pump for heating or cooling. The air handler contains a

large blower and a filter just like conventional air conditioners. 

Installation Options

The installation of a GHP system is not for the do-it-yourselfer.

Contact local utilities, IGSHPA (see Source List), and the GHPC

(see Source List) for references on licensed and experienced

installers. In addition, many states have Heat Pump Councils

which may provide additional referrals.

There are four basic types of ground loop systems. Three of

these—horizontal, vertical, and pond/lake—are closed-loop

systems. The fourth type of system is the open-loop option.

Which one of these is best depends on the climate, soil conditions, available land, and local installation costs at the site. All

of these approaches can be used for residential and commercial

building applications.

Closed-Loop Systems

Horizontal 

This type of

installation is

generally most

cost-effective

for residential

installations,

particularly for

new construction where sufficient land is

available. It

requires

trenches at least

four feet deep.

The most common layouts either use two pipes, one buried at six feet, and

the other at four feet, or two pipes placed side-by-side at five

feet in the ground in a two-foot wide trench. Or, the SlinkyTM

method (shown) of looping pipe allows more pipe in a shorter

trench, which cuts down on installation costs and makes horizontal installation possible in areas it would not be with conventional horizontal applications. 

Vertical 

Large commercial buildings

and schools

often use vertical systems

because the

land area

required for

horizontal

loops would 

be prohibitive.

Vertical loops

are also used

where the soil

is too shallow

for trenching, and they minimize the disturbance to existing

landscaping. For a vertical system, holes (approximately four

inches in diameter) are drilled about 20 feet apart and 100 to

400 feet deep. Into these holes go two pipes that are connected

at the bottom with a U-bend to form a loop. The vertical loops

are connected with horizontal pipe (i.e., manifold), placed in

trenches, and connected to the heat pump in the building. 

Pond/Lake

If the site has

an adequate

water body, this

may be the lowest cost option.

A supply line

pipe is run

underground

from the building to the water

and coiled into

circles at least

eight feet under

the surface to

prevent freezing. The coils should only be placed in a water source that

meets minimum volume, depth, and quality criteria.

Open-Loop Systems

This type of

system uses

well(s) or surface body water

as the heat

exchange fluid

that circulates

directly

through the

GHP system.

Once it has circulated through

the system, the

water returns

to the ground

through the well, a recharge well, or surface discharge. This

option is obviously practical only where there is an adequate

supply of relatively clean water, and all local codes and regulations regarding groundwater discharge are met.
In Lincoln, Nebraska, not only is the school district benefitting from the savings of GHP systems, but the taxpayers

are, too. With cooperation from Lincoln Electric Systems

and Lincoln Public Schools, four elementary schools

recently installed GHP systems. The heating and cooling

costs are about $144,000 a year less (for 1996–1997) than

they would have been if those schools installed more traditional heating and cooling systems. These savings will

reach about $3.8 million over just 20 years, allowing for

other capital improvements to be realized. 

Compared to natural gas HVAC systems (air-cooled, 

variable air volume systems) that were installed in two

other schools at the same time, the schools had a total

energy cost savings of 57%. There were also 42% and 20%

reductions in electrical demand and electrical energy consumption, respectively. Not only will the school district

taxpayers save about $3.8 million over the next 20 years,

but the GHPs also help reduce peak demand for electricity

compared to alternative systems.

6

Source List

The following organizations serve as excellent resources

for information on geothermal energy and its various

applications.

U.S. Department of Energy (DOE)

Office of Geothermal Technologies, EE-12

1000 Independence Avenue, SW

Washington, DC 20585-0121

(202) 586-5340

http://www.eren.doe.gov/geothermal/

Sponsors research to improve GHP technology, and works

closely with industry to develop design tools and advanced

technologies, and provides technology transfer. 

The Energy Efficiency and Renewable Energy 

Clearinghouse (EREC)

P.O. Box 3048

Merrifield, VA 22116

(800) DOE-EREC (363-3732)

Fax: (703) 893-0400

http://www.eren.doe.gov/consumerinfo/

E-mail: doe.erec@nciinc.com

Provides free general and technical information to the public

on the many topics and technologies pertaining to energy efficiency and renewable energy.

Geo-Heat Center

Oregon Institute of Technology

3201 Campus Drive

Klamath Falls, OR 97601-8801

(503) 885-1750

http://www.oit.osshe.edu/~geoheat/

Provides technical information regarding GHPs to consultants,

developers, potential users, and the general public; information has been developed through extensive research and firsthand experience with hundreds of projects. Publishes a

quarterly bulletin. The center’s resources are available to the

public through the auspices of DOE.

Geothermal Heat Pump Consortium, Inc. (GHPC)

701 Pennsylvania Avenue, NW

Washington, DC 20004-2696

(888) ALL-4-GEO (255-4436)

http://www.geoexchange.org/

Provides extensive information regarding geothermal heat

pumps, including consumer brochures, technical reports, and a

database of installers. The Web page contains case studies,

published articles, list of equipment suppliers, and workshop

schedules and locations. The GHPC has broad-based support

and participation from DOE, the utility sector, and geothermal

associations and manufacturers.

International Ground Source Heat Pump Association

(IGSHPA)

490 Cordell South

Stillwater, OK 74078-8018

(405) 744-5175

(800) 626-4747

http://www.igshpa.okstate.edu/

Established in 1987 to advance geothermal/ground source heat

pump technology on a local, state, national, and international

level. Provides a list of equipment manufacturers, a state-bystate list of installers, and numerous design manuals and

brochures for contractors, homeowners, students, and the general public.

PIX06649

Cavett Elementary School in Lincoln, Nebraska, is one of several

Lincoln schools that saves money and energy with GHP systems.