Our GeoThermal Install Experience

We first considered GeoThermal a few years ago, but we decided to move forward when our 30 year old AC unit broke down last year and we were looking at a $6K expense to replace it we decided the expense would better defray the cost on a geothermal system install. Any major expense to repair a heating or cooling system can generally be applied to good effect to make the initial install more cost neutral – or even cash flow positive – and the long term benefit reduces out much of the cost of home heating and cooling. In our case, we also benefited from integrating the cooling into our existing duct system for heating which services our entire house – our old AC system only serviced half the house due to the separate duct placement covering only the top levels.

We contracted our installation though Sansoucy Geothermal of Paxton on the recommendation of a friend. We wanted better quality components so we could avoid most maintenance calls for the rest of our lives – they were like minded and recommending those as well so they were a very good fit for us. The gating factor to starting the work was the availability of the drillers to drill the 2 – 350 foot deep bores we required for our closed loop system. We also had extra work to remove some broken AC equipment and upgrade our electric service that increased our costs a little – our old fuse base panel with 100 AMP service was upgraded to a 200 AMP service with breakers to better support the system.

If you’re a Massachusetts resident, financing is best done by putting part of the project on your equity line and getting a $25,000 HEAT loan with a local qualifying lender at 0% with a 7 year repayment term for the rest – after qualifying through MassSave for the program.

The federal tax rebate of 30% for geothermal should almost pay off any equity borrowing if you can keep the install costs down to about $37k. The HEAT Loan will be payed off after 7 years of $300 interest free monthly payments. The savings in heating and cooling costs of 30-70% will cover the HEAT Loan payments if we anticipate averaging about $450 in monthly heating and cooling costs over the next 7 years absent any changes to our previous heating and cooling systems.

We researched MASSSave for other programs and rebates as well –

  • We qualified for the heat pump water heater rebate of $750
  • We were not able to verify qualification for the Early Furnace Replacement Rebate (an additional $750) prior to the installation. The Early Furnace Replacement rebate likely only applies to replacing an older furnace with a newer furnace, however it wouldn’t hurt to check into this if you have the time to validate the requirements.
  • We are still looking into the thermostat rebate for $100, but we believe our thermostat only qualifies for $25 under this program because our thermostat does not have wireless connectivity. Our installer did not save the UPC code from the thermostat packaging, so we applied absent the UPC code and may have that rebate refused.
  • We were hopeful to get a rebate on the GeoThermal unit itself, however many of the heating and cooling rebates were for ductless mini-split systems or air source heat pumps. We have applied for the rebate and are awaiting a response.

Our regrets? Our first – and hopefully only – regret was not cleaning the ducts first. The fan in the geothermal unit is much more powerful than the one in our old heating system. When it was fired up, a massive amount of soot that passed through the furnace was blown out of our ducts and into several rooms in the house. After the initial brief disappointment, we were quite happy knowing that there was no possibility of introducing soot into our home in the future.

The entire install included a new hot water heater that will reduce our electric bill by about $40 / month during the winter, which is maybe a third of what I anticipate as the cost of running the unit. During the summer months, the geothermal unit should be sufficient to heat all our hot water and hopefully reduce electric consumption for hot water heating by an additional $40 / month. We opted to spend a little more for the variable speed pump and companion control board to further reduce the electric usage of the unit.

Our first full month of operation from mid-August through mid-September shows a general electric consumption reduction of 10% compared to the same one month a year ago. Note that we did not have functioning air conditioning during that period last year. We originally had thought that we had an increase based on our electric bill, but we discovered that N-Star was estimating electric usage on a meter that was taken out of service when our fuse based system was upgraded to breakers as a part of this installation and consolidated down to a single meter.

We’ve been tracking electric usage since the installation, and our readings in mid-October and mid-November show roughly the same electric usage as our first reading despite the increasingly cold weather. Our electric bill for mid-November to mid-December increased by 87 kWH, but the colder mid-December to mid-January period, with some bitterly cold sub-zero weather, increased consumption by 290 kWH compared to the same period last year. Our next update will be in mid February to establish a definitive assessment on heating efficiency during peak heating season. I am anticipating a modest decrease from the January reading considering the abnormally cold weather this past month.

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Evaluating Home Heating Oil Services

We recently went through the experience of changing our home heating oil delivery service after 17 years with the same provider – it was an eye opening experience. As a consequence of this change we’ve come to the realization that we need to perform an annual review on all our service providers to ensure we are getting full value for the price paid on services provided. In this particular case performing an annual performance review would have saved us over $1800 in heating costs over the last 10 years.

There are a number of online resources available to help evaluate where your provider stands in terms of pricing, but the one I liked the most was Mass Energy Consumers Alliance historical pricing page. We were able to pull point pricing for any given week from this page for dates going back to July of 2005 and combine this with our purchase history as extracted from our financial files to build an analysis workbook Seasonal_Usage_and_Pricing_xlsx

In reviewing the average pricing versus the pricing we received from our oil supplier, we realized we were paying well above the average price for heating oil. On further investigation we found Massachusetts publishes a heating oil price range online – and our supplier had pricing correlating to the MOST expensive oil in the state. So we switched over to Devaney Energy, which has better pricing than the Mass Energy Consumers Alliance listed above and we now have some of the lowest priced oil in Massachusetts.

The analysis also provides some other pretty useful trending data over the years. When we purchased the house we were consuming about 740 gallons of oil per year and we completed our 2013 heating season with consumption of only 362 gallons – less than half the oil we were consuming on initial purchase for a annual savings of $1600! Of course, the replacement windows in 1999 with the insulated siding improved efficiency by maybe 5-10%, but re-insulating the lower attic in 2006 made the biggest difference reducing consumption by about 25-30%  while insulating the upper attic and walls in 2009 and closing the air gaps in 2012 seems to have reduced the remainder of our losses. Clearly the greatest return on investment was the insulation which cost us maybe $3500 in total.

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Improving Home Energy Usage

A few months ago we had an energy audit performed by Next Step Living courtesy of the Mass Save Home Energy Services program. They identified several areas where we could improve including adding an addition layer of insulation in our lower attic and sealing the airgaps at the top cap of our interior walls. They even installed a low flow shower head at no cost at the completion of the free audit. The quote for the work to improve our insullation layer came in at a cost of $1,219 but the cost to us was roughly $305 due to subsidization by the state for this program. Needless to say, the Mass Save program was an incredible deal and provided significantly more value per dollar than working with our previous contractor, who – two years previously – added cellulose insulation in the upper attic and into the walls at a cost of nearly $6,000. The Next Step Living contractors identified and repaired the shoddy work performed by that previous contractor in the upper attic where they had not dammed the air conditioning unit and had blocked the exterior vents in the attic with the insulation they had blown in over the existing decayed insulation.

We also considered the free installation of solar panels offered by Next Step Living through their relationship with SunRun – however the penalties for exiting the contract at 10 years amounted to roughly 40% of the cost of an outright purchase of the equipment (roughly $25,000 after tax credits and rebates – $2000 through Mass Save) – and those early termination fees would not be applied toward a purchase of the equipment already installed on the house.

We’re also looking into ways to decrease our electricity consumption, which is somewhat out of control with 3 kids in the house that have a hard time turning off lights when they leave a room or finish traversing a hallway. We have CFL bulbs in many of our fixtures, but they contain mercury and frankly are not as efficient as LED based lighting. Massachusetts utility customer can purchase LED lighting at a discount at estarlights.com courtesy of the relationship established by the Mass Save program

The Next Step Living contractors also provided us with quite a bit of collateral including an energy savers guide with some good information that is replicated out on EnergySavers.gov in a PDF format.

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