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How Much Does a Geothermal Heat Pump or Heating Cost?

Candace Nelson
Written by Candace Nelson
Updated June 2, 2021
a geothermal heat pump in basement

© caifas - stock.adobe.com

A geothermal heat pump costs on average $10,318 to install with a typical price range between $3,650 and $17,000.

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The pump can help reduce home heating and cooling costs. Larger homes that use a high-end system or require excavation and new ductwork could pay as much as $30,000 for geothermal installation costs.

How Does a Geothermal System Work?

Just below the Earth’s surface, the ground is a consistent 45 to 75 degrees. A geothermal heat pump pulls cold air from the house in the winter and runs it through pipes underground to warm it back up and flow it back in. The process reverses in the summer when warm air is pulled from the home and cooled in the underground pipes. The process simply moves heated or cooled air from one place to another.

This is a clean, reliable, and renewable heating and cooling process that should keep you comfy all year ‘round. While installation costs are higher than a traditional HVAC system, it could be offset in energy cost savings in 5 to 10 years, according to the Department of Energy.

How Does the Cost of a Geothermal System Compare?

There’s no denying that the upfront cost of installing a geothermal heat pump (also called ground source heat pumps or geothermal HVAC systems) is steep. It’s 30 to 40% more expensive than installing traditional heating and cooling systems, but before you say no, let’s look at a few facts.

  • Geothermal systems can last twice as long as traditional systems.

  • Energy use is reduced, so you can expect lower energy bills that could offset installation price in 5 to 10 years.

  • Geothermal is “clean” energy, which reduces your carbon footprint.

In summary, your house stays at a consistent temperature all year round, you get lower energy bills, and you’re having less of an impact on the planet. But wait, there’s more!

Tax Credits Bring the Geothermal Installation Cost Down

A federal tax credit is in place through 2024 to help with the cost of installing renewable energy systems, like geothermal heat pumps. The credit could make the cost of a geothermal heat pump system comparable to furnace and air conditioning systems. The credit applies to new or existing homes. Second homes also qualify.

Factors to Consider When Sizing a Geothermal Heat Pump

Your pump needs will vary based on the size of your home, the terrain of your yard, and the climate you live in. The Manual J method factors the size and shape of the home, the climate, and amount of insulation in the home along with the preferences of its occupants to calculate the heat pump necessary. 

A pump that’s too big or not big enough could make your system inefficient and leave hot and cool spots in the home. Even worse, it won’t properly control humidity. It’s worth having a pro assess your space. Find a geothermal installation company near you.

What is the Cost of a Geothermal Heat Pump Near Me?

Installation cost can vary by region. Here’s a look at the typical price range in 10 U.S. cities.

  • Dallas: $4,900–$10,000

  • Baltimore, Maryland: $9,000–$30,000

  • Minneapolis: $2,700–$11,000

  • Indianapolis: $1,750–$12,000

  • Boston: $12,420

  • Chicago: $2,100–$25,000

  • Cincinnati: $4,300–$10,100

  • Pittsburgh: $55,600–$61,000

  • San Antonio: $14,300–$18,100

  • Atlanta: $5,100–$27,700

What Is the Cost of a Geothermal Heat Pump?

A ground source heat pump costs about $2,500 per ton. Most homes will need systems between 3 and 5 tons.

Types of Geothermal Systems

Depending on your yard, your geothermal heat pump professional will recommend a horizontal, vertical, or looped system.

Horizontal systems are most common for residences. Looped pipes are buried 4 to 8 feet deep. 

Vertical systems are used when the yard isn’t big enough to support a horizontal system or the soil is too shallow to accommodate the trenches. Instead, the pipes go down 100 to 400 feet into the earth. This is, as you might guess, the most expensive option. 

If you’re lucky enough to have water access on a lake or pond, you might be able to use a lower-cost system that runs 8 feet under the water’s surface. Your professional will let you know if your water meets the criteria. (Fingers crossed for you!)

Can I Install a Geothermal HVAC System Myself?

This is not a home improvement project that should be done without professional help. It takes precision and expertise to design the system around climate, different soil conditions, and water while factoring in home size and household preferences. A professionally installed system can last decades and drastically cut your energy bills, so it’s worth paying a pro to get it right. See what questions to ask your HVAC pro.

Geothermal Heating and Cooling Cost Breakdown

Depending on your home’s needs, you can expect the following costs for your geothermal pump project.

  • Pump and installation $2,500–$5,000 per ton

  • Upgrading your ductwork $5,000–$20,000

  • Resodding your yard $450–$4520. Unfortunately, geothermal system installation is going to seriously disrupt your yard. Hopefully you didn't just landscape! Factor in the cost of fixing it back up.

a geothermal heat pump in a small wood room

© geoleo/ iStock / Getty Images Plus/Getty Images

FAQs About Geothermal Heating Systems

What are the advantages of a geothermal HVAC system?

Geothermal heating, ventilation, and air conditioning systems heat and cool your home. They can even be equipped to provide hot water to the house. They are quieter than traditional systems and need little maintenance. 

Geothermal systems don’t have to work harder based on extreme outdoor air temperatures like other heating and cooling systems do. No fossil fuels are burned nor is carbon monoxide released in the process, making it a healthy choice for humans and the environment.

Indoor components have a 24-year life while the outdoor components are protected from the elements and can last 50 years. Most traditional air conditioners start to have problems after 12 to 15 years. (PS: If your house isn’t feeling so cozy, diagnose your heat pump problems.)

How does a heat pump work?

On warm days, a heat pump pulls warm air out of your house. Yes, despite the name, a heat pump can cool the house. On cold days, it pulls the cool air out. 

Geothermal heat pumps move the too-warm or too-cold air of the house through the Earth, just below the ground where the temperature hovers around 50 degrees year-round. Imagine how much easier it is to heat air that is already 50 degrees than to heat it from the freezing outside air temperatures common to Northern states in the winter. 

Other systems exchange the home’s hot or cold air with outdoor air, where the temperature fluctuates and burns more energy to heat or uses coolant to bring the home to a comfortable indoor temperature.

Who should consider a geothermal HVAC system?

The ideal time to install a geothermal heating pump is when building a home, so you can reap the benefits right away and don’t have to retrofit. You might also consider making the switch if you have high heating and cooling bills that you’d like to cut, need a new furnace or air conditioner, and can afford the initial cost. A geothermal system is especially efficient if you live on a lake or pond.

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