We are building a new house that is designed with efficiency in mind. We are spending extra for SIPs and windows with U rating of 0.19 and so on. Also sized the house down to what we feel is pretty reasonable for a middle income family of 5. Most installers are recommending systems sized at 5 or 6 tons. I have done my own heat load calculations and come up with under 30,000 BTUH. Of all the bids I did get one contractor that bid for a 3 ton system which I agree with and his bid is $21,500 for horizontal loop. My parents built a house 8 years ago. The house was larger and not as well insulated or sealed. They had a 5 ton geothermal system installed for under $17,000. Why the big price increase in 8 years. The 5 ton bids I received have been around $30,000 for horizontal loop. That's about an 80% increase. At the very least, I feel like the tax credit is going to the installers instead of the homeowners. Am I wrong to feel this way?

The only real thing that decreases prices is competition. Why wouldn't suppliers raise prices if there were tax credits? The only thing that will keep prices in check is competition. Look at college education costs which are subsidized by low interest loans/grants. I think the price of golf carts rose quickly too when there was an "electric car" tax credit.

It would be a good subject of a study how subsidies effect prices.

I know you're right. They can charge what they want as long as someone will hire them. I just don't like it. The budget is crunching!
Thanks,
Brett

The cost of your system shouldn't be your primary concern, be very concerned about who installs the system and if he will be around when and if trouble happens, this technology is still young there are few requirements for installers to be honest and do a good job, there are too many who have had systems installed only to find they don't work as they should and the home owner is left holding the bag after they get your money and run...
but my answer to your question is even honest dealers need the increase in cost to help keep them in business.

Well, $17K adjusted by 3% for inflation annually from 8 years ago is now $21,500 today.

But costs of running the business have increased. Gas for the vehicles more than doubled, price for copper pipes almost tripled. But you also get more for your money. 2 stage systems, desuperheaters with hot water generation incl. an extra buffer tank, much longer warranty, much higher efficiency. From 3 stage touch screen thermostats to outdoor reset controls to self purging flow centers. In addition we pride ourself in being extra meticulous in our work, go the extra mile for our customers. That all costs money, but is also much appreciated by our customers. Many times we are outbid by the competition, by are still getting the jobs because customers educate themselves and check our previous installs and references, and understand the value we bring to the table.
Turn key with advanced 3 stage design and DSH with 2 tanks, a 3 ton horizontal system runs usually around 21K-22K with us, 5 tons is around 27K. Much less and we go out of business. Prices can vary due to geology, dealer structure (some dealers have to pay more for the units due to lower volume etc.). Our prices almost stayed the same in the last years due to increased efficiency for the installs and thanks to the tax credits, we are selling many more. So the higher material costs were compensated by higher volume thanks to tax credits. So in our case, the tax credits actually kept the prices stable. And yes, competition is good, we welcome it. They push us to perform even better, not necessarily cheaper.

Myriad other costs of doing business have risen as well - health insurance, permit fees, workers comp, liability insurance, etc.

R410a added extra costs for tools and training. ECM blowers are pricey. Geo is a new line of biz for many companies, so startup costs apply. The hope is that tax credits will jump start the industry and make it a mainstream option. Then prices will drop as economies of scale and imcreased competition kick in.

palm.....from all the threads I've read on here over the years, that price is a steal! I don't think I've 'ever' read somewhere that the price was below 35K!  We need ALOT more competition everywhere in the country.

Palmtree,

Iif the design day Manual J load is truly under 30 kbtuh, an 026 model (nominal 2 ton, two stage unit) may be the best fit, unless that is a peak cooling instead of heating load. That could substantially reduce installation cost.

You've made a big investment in high-end building assembly components (SIP, U=0.19) Be certain to complement those investments with a carefully sized HVAC system. Right sizing ensures all of maximum efficiency, comfort, quiet operation, and reasonable first cost.

Tell us approximate location and conditioned square footage.

The costs of goods and services should be driven by free trade and competition. Currently geothermal is still the "new thing" in many markets with prices that are estimated by contractors involving a CYA for things they are not comfortable with. As markets catch up the pricing gets better.
In my market geothermal is mature and booming. The govt. incentives cover the cost of the construction of the heat exchanger, making the choice to go geo a no brainer when compared to the costs and operating expenses of conventional systems.
As the wave continues to build, unless you live in an area that is dominated by hard rock and no overburden with no water available for geo, all will change. As a side note I am working with a client who is blown away by the costs involved with sips and fox blocks in our market. Where they came from it was an economical choice over traditional methods, but not here.
Hope this helps
Eric

Palmtree, I have encountered the same thing, having load calcs by others come in at over twice my own results. Mine I did by spreadsheet, with the early numbers in fair agreement with a run on ResCheck. All later runs done for tuning up the house design were by spreadsheet. I researched every number I used, trying not to be too optimistic about performance I'll get. One thing that is seen by looking at all the numbers that go into the total is how dependent the design load is on air leakage that doesn't go through the HRV.

I did get to see details on one load calc done by an HVAC contractor. In reconciling my numbers with his, right away I saw two things different. He had included (selected from a software dropdown list) 10K BTU/hr for a fireplace (there is none in the house) and 18K more in air leakage than my number. Together those two items were almost 2.5 tons of heat demand, around 90% of the difference at the time. The rest were little things, like R-33 walls at the bottom of another dropdown list vs. my R40 whole wall design. The reconciliation actually gave me confidence in my own numbers. I know what goes into the total and where the biggest uncertainties are.

I won't know if the heat pump will be a 2- or 3-ton unit until after the blower door is done. If I meet my goal on tightness, a CM Tranquility 2-ton will work comfortably to -5 F (Central NH), with a comfortable margin for gradual fouling of the heat exchanger. The three other load calcs were all fairly close together in bottom line, and would have called for a 5-ton unit. I am speculating that all three had the same sort of differences from mine as I saw in the one where I had detail.

I think that the differences tell me three things.

It takes a great deal of time and patience to build a very good energy model for a specific house, perhaps more than a contractor is willing to spend for a job he may not get, and requiring more detail on the house than he is given and has time to request to refine his numbers.

Software built for automating heat load calcs (eg. Wrightsoft, HVAC-Calc) may not have enough options on dropdown lists to cover superinsulated house designs, or overriding built-in numbers takes a lot of time and understanding of heat transfer principles that the software user may not have.

Results of canned software may well be good for sizing equipment for typically constructed houses, but good numbers for a superinsulated design are either outside the capabilities of the software or outside the experience of the contractor.

The whole purpose of using detailed calculations for HVAC sizing, rather than old rules of thumb, is to get equipment properly sized for the job. Applying numbers in a piece of software that are based on ordinary construction techniques to a superinsulated design is in a sense using rules of thumb at a different level.

Couple different things are covered here:
size and price.

To start with pricing, as little as 2 years ago an R-22 1 stage geo heat pump was Energystar approved. A 2 stage R-410 model can very easily cost 20% more. If I buy the Energystar dishwasher to get my tax credit and rebates, I will likely spend more than purchasing the economy model. At least with heat pumps the credits actually save me money over less efficient models.
Next I have to buy and install a buffer tank so the DSH actually works with my R-410 system.
One other thing that has changed around here in the last 8 years is the marginal guys are out of business. Once the building boom crashed lots of low ball installers caved in. Those that are left are the ones that charge enough to stay in business.
Finally, geography matters. I remember a post somewhere (a few years ago) where an IN contractor stated smugly that anyone charging more than $15,000 for a 3 ton was gouging.....here's the thing, my new neighbor from IN tells me everything here is more expensive....gas, insurance, realestate, internet service, phone service etc. That's gonna impact a company's pricing.

Regarding the sizing of your system Brett, what were their heat load calcs and what is the reason for disparity?
Dick Russel is right in that guys can make data entry mistakes, but that goes both ways. Experienced installers may also know something you don't so communication is the best tool.
Regarding size selection, not knowing where you are located, I would say 3 ton could be oversized as well.
Good Luck,
j

Thanks for all the great info. Don't let the screen name fool you. I live in Warrensburg, Missouri -- no palm trees around here. I will go back and triple check my numbers then get back to you guys. Thanks again, Brett

OK folks. I ran the numbers again and I get 28,869 BTUH. Can you think of any common oversights that I may have made? Thanks, Brett

Ventilation is the easiest to over look. How many air changes do you anticipate to keep your tight house full of fresh air?
Next is foundation, a conditioned basement costs about as many btus as uninsulated duct in a non heated basement.
You are not offering much to help explain disparity between you and the other guys. Did they actually perform heat loss calcs? Did they provide you with results?
Is that heating or cooling by the way? If so what is cooling load? Gusys might for cast a higher cooling than heating load.
J

I'll give you a data point. Southern Michigan, good loamy soil. My 4 ton horizontal loop was $6500. It's a flat rate of 1600 / ton from the loop installer I used. He does most of the loops in the state. If you got a bid for a horizontal loop less than 5 tons at 21500, I'd estimate he's gouging unless you've got really bad soil and need more pipe or something.

The loop installer said he just quotes 1600 a ton because most of the loops need the same amount of digging and pipe with the soil we have here.

The equipment cost will be variable depending on what you get. My equipment was at a discount due to my circumstances and my hydronic plumbing added to my costs.

86,
The $21,500 quote is for new construction project and not only includes ground loops, but heat pump, duct system and generally dryer vent, ventilation etc.
Your loop only quote is about the going rate in MI though anyone who told you they do" most of the loops" is pulling your leg.
Biggest company out of Whitmore lake may do more than any other single operator, but most of the loops in MI are done by low volume mom and pop shops who may do less than 12 systems/yr.
joe