Rules of Thumb (ROT) are one of the biggest market barriers holding back the geothermal heat pump industry. Say you have a potential client come to you with drawings for a 24,000 square foot building asking you how much it would cost to install a geo system in their building, and what it will save them. How do you respond? You'd want to design and install a system for them and you need to give them a quick answer so they don't lose interest and decide to go with a gas boiler or rooftop units. You know many decisions about their building are made early in the design process. You know that they are likely talking to others about their heating, ventilation and air conditioning (HVAC) system. And you know that once they've decided on the HVAC system it's difficult to get them to change their mind. So it's important to respond quickly about capital cost (CAPEX) and operating cost (OPEX). That's where the ROT sets in: • 24,000 square feet divided by 400 square feet per ton...they'll need about 60 tons of heat pump equipment. • 60 tons times 200' of drilling per ton...about 12,000' of borehole So you tell your potential client that it will cost them about 12,000' times $18 per foot...about $216,000 extra to install a geo system. And all you can tell them is that's it's going to be cheaper to heat and cool their building. How much cheaper? About a quarter the cost of electric heat. How much cheaper than gas? Well...gas is pretty cheap...but it's still cheaper than gas! That's unlikely to give them a lot of assurance that installing a geo system is the right thing for them. Ya...it may be better for the environment and all that, but at the end of the day it's still all about the money. So they go to the guy down the street that will sell them a reliable gas rooftop unit. GeoFease draws on a huge database of real energy models of real buildings. Every energy model has several iterations showing the impact of adding an energy recovery ventilation system, better glass, or adding domestic hot water loads to the building. Then it helps you calculate the size of the ground heat exchanger (GHX) you need...allowing you to change the spacing between boreholes, borehole layout and design, try it with more efficient heat pumps...using leading industry standard software...and give your client a much more accurate cost. It also allows you to input current utility rates, the carbon intensity of electricity from your utility, drilling rates in your area...and give them a much more accurate assessment of what a geo system can do for them...in a detailed report complete with simple payback, ROI, NPV and IRR. Information they can take to their bank with confidence. Real answers based on real numbers.
Posts by Edlohrenz (2)
Electricity is taken for granted by most of us. It's always there and we rely on it. To deliver it electric utilities invest heavily in power plants and power lines to guarantee they can deliver enough power on the hottest summer afternoons when everyone has their air conditioning running. To deliver one kW of power...enough to run a hair dryer...they have to invest at least $2,000 to build a gas turbine generator. To build a nuclear plant, about $6,000 per kW, and hydro-electric dams can cost as much as $12,000 per kW. And that doesn't include the power lines needed to deliver the power. To deliver enough power for those few hours a year the utilities have to invest a huge amount of capital. But as soon as temperatures drop and the sun sets the need for cooling disappears and the power plants shut down. They're not producing kWh and revenue for the utility disappears. In winter even less electricity is needed with lower cooling loads and gas and other fossil fuels are used to heat the buildings and produce hot water. Large investments made to generate enough electricity to meet the summer peak cooling loads sits idle...generating little revenue. Geothermal heat pump systems help the utility in two ways. They produce the same amount of cooling in summer and draw less power. A study by Western Farmers Electric Cooperative in Oklahoma shows that a geothermal heat pump draws approximately 40% less power to deliver the same amount of cooling. That means the investment needed to build power plants and power lines is reduced. In winter the geothermal heat pumps use electricity rather than natural gas, oil or propane. The utilities are selling power all winter and earning revenue from power plants that would otherwise be sitting idle. This benefits the electric utility...less investment, more revenue. In most jurisdictions electric utilities are publicly regulated...savings have to be passed on to the consumer.