Here's the paper I was talking about. It is 13 years old, so obviously the cost data is not accurate anymore, but I think it raises some interesting points.

http://geoheat.oit.edu/pdf/tp72.pdf

I kind of skimmed through the paper, I think it kind of supports my point. If after 13 years heat pump install costs have almost tripled (at least for a vertical 3 ton system) the chances of them coming down significantly are slim to none.

I am not saying that there are not improvements that could be made to reduce costs, I just don't think geo prices will ever be in the same ball park as conventional systems as the poster above was hoping.

Kind of like hoping that oil prices or health care prices will come down.

I would have to disagree, If Geo because popular enough, there's a perfect solution for the Ground loop problem, City Water. In rural area's, if policy changes were enacted to run 2 water lines to each house, instead of just one, Geo system could use city water as there loop source. Of course there would have to be special controls to ensure that Water entering the system isn't introducing any impurities into the general water supply and have a seperate meter for general use water, water not cycled back into the water supply (Ie toliets, showers, sinks). When a new house is connected into the water supply, standard practice would be to run two water lines, even if it's not being used at that time, additional costs would be minimal. Since the water has to travel from the house to the street, up and street and to the next house, it could work just like a closed loop, the transfer process could occur during the route. As the density of housing increases, this starts to become impratical, but it could work even in high density areas, just the number of houses connected into the system would have to be restricted, say one system per every 5 houses. This of course would be a long term plan that would take some time to implement, but as alternative energy solutions are introduced to the general public, (ie Wind, Solar), this could make a good addition to the master plan. 

Another idea would be to have a community wide closed loop. A new development would have seperate lines run from the street to each house as part of a closed loop system, the loop could be placed under the streets, which assumes the cost of installing the one massive loop is far cheaper then 100 seperate loops for each of the houses. 
 
   

Health care is a commodity where the demand will always outstrip the supply; oil is a strategic commodity where there is little relationship between price and cost so for both of these the "normal" rules of supply and demand don't work.

Ground source heat pumps are more expensive than air source because the volume is tiny in comparison. This means the mark-ups have to be correspondingly higher. Imagine a sales person trying to make a living selling regular A/C equipment versus one selling GSHPs - to make the same income per year the commission on the GSHP is much much higher. The same logic applies to the manufacturers  - to make a decent profit they have to charge more because there's less economy of scale.

On the sales side, there's another problem: GSHP systems are sold as "high end" so the buyers themselves expect the price to be higher - otherwise how could the system be high end? In my locale, I know many people who have installed GSHPs so they can boast to their friends (a) how much it cost and (b) how "green" they are. Most of these people could care less about their energy bill per year as it's lost in the noise compared to their other discretionary expenditure.

Drilling costs are high for the same reasons: the high cost of the equipment has to be amortized over the number of installs peformed per year plus the cost of getting the equipment to where it has to be used. If tract home developers started to install GSHP systems en masse, there would be huge economy of scale in the drilling (if vertical) or trenching (if horizontal) that would massively reduce the cost. This will only start to happen once the cost of fossil fuels becomes such that it is not economic to burn such a precious resource anymore (rather than using it for something productive like making things that otherwise couldn't be made).

As for technological improvements, the law of diminishing returns applies. COPs are already fairly high - going from COP=3 to COP=6 would only halve the annual running cost compared to the 2/3 reduction the COP=3 gave; half of a small number is an even smaller one. So whilst it's technically possible (we're still some way off the Carnot limit at current working temperatures), it's not as economically interesting as it may seem.

All that said, equipment costs can be relatively small - a system designer friend of mine installed a water-to-water system in his house (with fan-coil+ Unico distribution and wood stove back boiler as auxiliary heat for the buffer tank) and the heatpump itself (Carrier re-badge) was only Can$1500. He picked this system as the heatpump cost was low and wanted to integrate a backup solution that would work with minimal power requirements in case of power outages. Astoundingly, he got by with no drilling for a couple of years - until the local municipality finally banned the use of tap water as a coolant for A/C systems (which he used as a loophole to supply his water-to-water unit). He said capacity was limited in winter, though, because he couldn't freeze the supply ;) This is in a large Canadian metro region BTW.

Regards,

Paul.

People seem to bring up the concern that there is little or no competition in the geothermal market. Dewayne, I'm sure you could attest to the opposite of this. In fact, there is a very large competitor out there. It is the "same-old thing", or "fossil fool" competitor.

Geothermal installers aren't just competing with geothermal installers. We compete with LP, Natural gas, Fuel oil, coal, wood, and electric heating. We also compete with air source heat pumps. The competition is fierce, and there are many more "bottom feeders", I'll refer to them as, in the fossil fool installation business than in the geo business.

So, we are trying to sell a premium product, competing with 'thumbulator bottom feeders' (bottom feeders are in a race to the lowest price), and trying to make a living at it. If there were really no competition, we could maybe raise the price. But as it stands, with the ample competition we have, we try to shave off as much as we dare to play the gamble of whether or not we'll get the job.

Now, to return to the subject of this thread, again... People are just costing themselves more money by waiting. Just like building a home. The longer you wait, the higher the cost will be to build it. In my own area people are waiting upwards of 3 months to even get the driller there. We have a lack of drillers, and I only have 1 rig. It can only do so much. Hopefully we'll add more rigs in the future, but there will still be a wait. In the waiting time, prices of materials will continue to rise.

I had a customer call me wondering if the price was the same as we quoted him 2 years ago. He would have to pay about $2,300 more now for the same installation he would have gotten back then. Now, because the price went up, he's thinking of not doing it for another year. That just boggles my mind. He'll probably keep paying for propane for the rest of his life, and never see the savings of geothermal.

Certainly he would be better off to do as Joe has said. Spend thousands now to save tens of thousands in the near future.

You guys certainly have some interesting ideas.  Are they possible?  I would say so.  Are they probable?  I would say not very.   

Sure  community loops could work and sure using the city water supply could work.  But neither of those  will do anything for all of the houses already built that are using fossil fuels.  Those houses have to be converted one at a time.  The existing home market will never see much in economies of scale.

All of the drillers that I know are busy drilling every day.   Some even complain that they never get a day off.  Drilling prices are not coming down.   

We are looking a buying a drill rig.  The cost is going to be close to $325,000.   As I look at paying for the rig and all of the costs of running and maintaining it,  I wonder if I can even make it work at the price of drilling in my area.

I challenge any one who thinks that drilling is over priced to go buy a rig and drill for less money.  Show us how it can be done.

Don't get me wrong,  I would like to see the geo install price come down as much as the next guy.  I just don't see it happening.

In fact based on what has happened over  the last 15 years,  I predict that geo pricing will continue to rise. 

Some think that prices will come down,  some think not.....I guess time will tell.

What is the market price of drilling in everyone's area?  In North Texas, it's currently $4 per LF grouted in.  Just wondering how prices here mearsure up to other parts of the country. 

They should come drill here. It's typically $6-$20 per foot grouted in Utah/Colorado. Mostly around the $11-12 range, though.

Same here(Charlotte, NC area).....around $11-12/ft.....I think this right here shows there is NOT enough comp.!
I think I worded my previous post wrong. I know GEO will 'always' be more exp. than standard HP....I talked with numerous HVAC people about having one installed in this area and only ONE(one of the largest HVAC companies in this area said they started to do GEO several years ago but only stayed in the business for a very short time! I still say there just isn't enough comp. between GEO installers to make it 'competive' between GEO installers....if that makes sense.. I know they are competing with the reg. HVAC guys installing 'IF' the home owners.....GC's....etc  are JUST looking at the cheapest they can get. GEO will 'never' be the least exp......it just needs more comp. between themselves and to educate the puplic 'why' they shoud spend more( I should say spend 'some' more....but not to the extent the differense it is now...........ditto on ICF's.......

If Drillers are so busy and rigs so expensive, perhaps you should look into going in as partners with someone. You could get the rig 4 days a week and the other guy 3 days than alternate each week. This way you both get time off, your both making money and your utilizing the rig to it's fullest potential. Having a 325k rig sit idle even one day on a weekend is still costing you money.

Clark,

Does this include the cost of the copper loops on DX or is this for drilling and grouting only?

Newsflash,
The thread is "don't wait." The point is supply lines are out of equipment due to unprecedented demand. Since I wrote that, I managed to find pockets of equipment, but am now struggling to find tube, manifolds, fittings, flow centers...... I've trained a second excavator. I've not yet raised my prices, but....For those of you waiting 'til prices come down; the earthloops are plastic (a petro product), there's rising freon prices, there's rising copper prices....there's rising steel prices.....
This stuff has been around since 1948ish if you think waiting will bring the price down, go for it. I'm paying overtime (not a price supressor). I'm working 7 days and it's not lost on me that raising prices may cut me to a 5 day week with the same wage. NOBODY WOULD HESITATE to purchase a stock with a 20% ROI, but some would dicker about the economy of geothermal while they burn $2.50/gal propane.
I've already confessed here that I don't have geo as nat gas is available and I'm leaving in 4 years, so since it doesn't make since for me-at cost, maybe my margin isn't that high.
2 pages ago I told you an ASHP had the same rate of return as a GSHP. True. If you have a really old furnace, a new one may have a great ROI.
Pick one or pay more, I won't feel a thing.
I didn't start this as a cost or best way to calculate savings discussion, I hoped to get people on the fence off their a@@. My customers get it. Sencarr will tell you that my competitors get it as one asked to come see his new system installed.
Joe

Oh and dare I mention in my area one electric provider- consumer's energy has already discontinued their discount on all electric heat and is talking about raising rates. Since they sell gas and must profit- by law- it is cheaper to discourage savings (and have to support their pathetic ancient grid) than to promote lower net energy use.

Joe.......hmmmmmmmm......I think ya need to start advertising around 2AM......you might get folks to respond...............maybe.............

The whole utility "pay-you-to-use-less-of-our-product" algorithm does seem fundamentally contradictory, aside from the peak-shaving benefit they get.

In your shoes, my prices would rise a bit - you're having to scramble and work nights and weekends - should get some overtime pay for overtime work. Make hay while the sun shines.

I have the same concerns as to this industry's ability to professionally, competently, and ethically meet the new demand.

Folks on the fence now facing winter shouldn't buy into an iffy system from a new or fly-by-night contractor to beat this winter's (now looking to be a tad lower) fossil energy costs.

On the other hand, folks that you've been in contact with on-again, off-again for 6 months or more about this, the contemplative, educated consumers do need to, um, defecate or get off the pot...

I'm sure I've contributed here around 2AM, Robin. If you track me you'll find entries after midnight and before 7AM. By the way if I ever sound cranky (not that it would ever happen here....LOL) ask my wife about my fall-disposition. You seem a little geo-skeptical and that's okay. I also have made the "one-size does not fit every application" comment in this thread. Of course as this is a geo dedicated zone, that's the thrust of my entries. I also have sold gas furnaces and ASHP's this week.
I think that I can also fairly say that I have offered the point; be sure about the investment (Engineer's "iffy" system) as the few hundred lost in potential savings could save thousands spent on unfortunate choices.
I do however have two seperate customers currently (that inspired this thread) that are still weighing their options. Both recieved my first quote last March.
j

Joe,  sounds like you are a busy guy.  Good for you.  In our area there are a lot of contractors sitting home due to the housing slow down.

Do you include an expiration date on your bids?    My bids are only good for 30 days.

Dewayne,
I include Exp dates and time bombs for delayed completions. All do to unfortunate experiences. I am only busy (and had this conversation this evening) as people can't afford their homes without relief. Retro's are 20 to 1 over new construction. I live in a community that was all contractors and commuters; turned contractors only as commuters moved closer to town (10mpg Hummers). Lots of LPG and fuel oil here. All I can say is that it is encouraging (and maybe a circle of life thing) that every installation includes a plumber, electrician, excavator and of course a tin knocker. Hope the oil moguls invest wisely, as we have a whole new economy starting up.
It is disgusting to me that folks with 1,000sf houses could find the expense of geo attractive, but they do. Not my idea, or yours I'm sure, just true.
j

What do you mean your leaving in 4 years? You plan to sell your house within 4 years? Have terminal cancer? Are the aliens coming to take you away? :)

As fas as I know, there's no supply problems here, soon as I was approved from my loan, I told the contractor I needed to give work 2 weeks notice to take off and he said it be no problem to order the stuff with that amount of lead time. Unless the demand for Geo is country wide, I find it very difficult to beleive there are supply problems anywhere thin the country. You should be able to order anything you need from other suppliers via UPS/FEDEX/DHL. Maybe your local supply houses are struggling to keep items in stock, but it's obvious you know how to use a comptuer since your on these forums, what prevents you from getting everything you require online?

In 4 years he'll have kids leaving the nest and look at downsizing his housing. I'm not sure why there might be a difference in availability. Perhaps Waterfurnace was more prepared for demand? As far as I know Joe works with EarthLinked, Climatemaster, and Bard.