Page 72 - North American Clean Energy May June 2015

geothermal energy

The Heat

is On

Geothermal

heat pump

industry seeks

recognition

By Douglas A. Dougherty

Above top: Home with horizontal ground loop heat exchanger Above: GHP Ground heat exchanger conigurations
Above: How GHPs work to produce renewable energy

WITH “GEOEXCHANGE” PIPING FIRMLY PLANTED IN THE EARTH, geothermal heat pumps (GHPs) Conventional equipment commands the heating, ventilation, and air-conditioning (HVAC) market,
eiciently use circulating water to transfer energy to and from the ground near buildings for heating leaving GHPs with a paltry 1-2% share. For too long, the GHP industry has been absent from the
and cooling. Yet, unlike renewables such as solar and wind, the earth also hides GHP technology from public policy table, left out of vital decisions on renewable energy, eiciency, and the value of thermal
public view. Out of sight, out of mind.
energy. As the nation pays increasing attention to opportunities for a greener, healthier environ-

ment, this industry has rallied its stakeholders across the country.

Slowly Recovering Market
With the onset of the Great Recession, the bottom fell out of construction starts, especially for new

homes. Ofsetting that market loss was widespread GHP adoption by business, schools, and other
institutions. he commercial market for GHPs during 2009-2013 was relatively strong and continues
to gather strength.
hough stalled by the extreme winter cold of the polar vortex that caused a 30% loss of sales dur-

ing the irst quarter of 2014, there are now some “green shoots” in residential GHP markets. he
industry entered the irst quarter of 2015 with renewed hope for the market and a signiicant uptick
in residential GHP sales.

Obstacles as Opportunities
A traditional obstacle to greater GHP market adoption is the upfront cost compared to conventional
HVAC competition. hat challenge has led to continuing improvements in equipment eiciency that

are making GHPs more cost efective by reducing the time that energy savings pay back an owner for
system cost.
he biggest challenge is to persuade more utilities to promote GHPs for ratepayer energy savings,
ofsets for power plant pollution, and reduction of peak summer loads. Progressive utilities, munici-

pal power providers, and cooperatives are doing just that with ratepayer rebate programs and “on-
bill” inancing.
Some utilities are installing ground loop heat exchangers and leasing them to homeowners. Several
electric cooperatives and municipal utilities are now analyzing the beneits of GHP loop ownership.

And land developers are recognizing that by installing GHP heat exchangers as they develop subdivi-
sions, they can earn continuing revenue by leasing geothermal energy to home buyers.

State Policies Key to Growth

he industry’s work for government policies that favor of GHPs runs the gamut from Congress to the
states. National groups, such as the Geothermal Exchange Organization (GEO), work closely with
state GHP associations, looking for opportunities in three arenas:
• Tax incentives to change consumer behavior in favor of GHPs;

• Amending Renewable Portfolio Standards (RPS) to include GHPs as a compliance option for renew-
able energy purchases by electric utilities; and,
• Adding GHPs to energy eiciency incentive programs.

In Massachusetts, there is a coalition of biomass, solar, and GHP advocates that successfully amend-
ed the state RPS to include thermal energy sources, including GHPs. Stakeholders in New Hampshire
and Vermont have won similar successes, while in Michigan, a push to amend the state’s RPS has now
shifted to include GHP technology under its energy eiciency law.

Given the strength of the Illinois Energy Eiciency Portfolio Fund, plus the willingness of local
utilities, GEO worked with the Geothermal Alliance of Illinois to amend state energy eiciency law to
include GHPs and make rebates available for consumers through utilities. Commonwealth Edison will

start a residential GHP incentive program this summer.
Fast-paced political opportunities require nimble action. Western Farmers Electric Cooperative
recently led the charge to include GHPs in New Mexico’s RPS. hat legislation was signed into law in
April.

72 nacleanenergy.com
MAY/JUNE 2015