Geothermal Savings Calculator

How it works

A ground-source heat pump does not make heat. It moves it. In winter it pulls heat out of the ground, which holds a steady moderate temperature a few feet down, and delivers that heat indoors.

In summer the same machine runs backwards and dumps your house's heat into that ground. Moving heat takes far less energy than burning fuel to make it. That is why a geothermal loop returns several units of warmth for every unit of electricity it draws.

Efficiency above 100% is ordinary for heat pumps, and impossible for anything that burns fuel. One machine covers heating and cooling, so it cuts both bills at once:

• heating and cooling, what each costs you now in a year
• reduction%, how much less you expect to spend on both once it is running
• geothermal, the installed price, ground loop included
• conventional, what a like-for-like replacement of your current system would have cost

That second cost is the one most comparisons leave out, and it is the difference between a fair answer and a discouraging one. If your furnace and air conditioner are at the end of their lives, the comparison is not $28,000 against nothing. It is $28,000 against $9,000.

Only that $19,000 gap is a real decision. On the defaults, $1,800 of heating plus $700 of cooling is $2,500 a year in energy costs, and a 55% reduction saves $1,375 of that. The premium comes back in about 13.8 years, against 20.4 years if you charge the whole sticker to the upgrade.

✓ Every result is checked against independent reference math. See how we test the calculators →

How to use this calculator

1. Enter what heating costs you in a normal year, taken from twelve months of bills rather than one cold winter.
2. Add the yearly cooling cost, which for most houses is the summer power above your baseline.
3. Set the reduction from a contractor's load calculation if you have one, and use 55% only as a starting point.
4. Put in the installed geothermal price with the loop field included, exactly as quoted.
5. Enter what a like for like furnace and air conditioner would cost, or 0 if you are not replacing anything.
6. Compare the two paybacks the tool shows against how long you will own the house, then research state and utility programs.

A worked example: $28,000 of geothermal against a $9,000 replacement

Say your furnace and air conditioner are both near the end. You spend $1,800 a year on heating and $700 on cooling, a total of $2,500. A ground-source quote comes in at $28,000, while replacing the furnace and AC like for like would run $9,000.

Expecting a 55% cut, the calculator puts the saving at $1,375 a year.

Now the part most comparisons skip. Charge the whole $28,000 to the upgrade and the payback reads 20.4 years, which sinks the idea on the spot. But you were spending $9,000 regardless, so the only money this decision is really about is the $19,000 premium, and $1,375 a year clears that in about 13.8 years.

Same house, same savings, a gap of nearly seven years, purely from framing the question correctly.

Change one number to see where it stops working. Set the replacement cost to zero, meaning your current system is fine and you are doing this early by choice, and the premium becomes the full $28,000 again: the payback stretches back out to 20.4 years while the saving sits unchanged at $1,375. Same saving, completely different verdict.

That is the whole decision in one input. Put your own bills and both quotes in above to see which side of it you are on.

Why does a ground-source heat pump beat a furnace?

A furnace at 95% efficiency turns almost all of its fuel into heat, and it can never do better than all of it. One hundred percent is the limit for anything that burns something.

Heat pumps are not in that contest. A heat pump uses a modest amount of power to run a compressor, which shifts heat from one place to another. How much it shifts is not capped by the energy it draws.

Ratings come certified through the Air Conditioning, Heating, and Refrigeration Institute (AHRI). That AHRI directory entry for your model beats any brochure.

What a ground-source unit trades heat with is the rest of the story. Underground, the earth holds a steady moderate temperature all year, whatever the weather does above it.

Air-source heat pumps pull heat from outdoor air. That air is coldest exactly when you need heat most, so their energy consumption climbs on the worst day of winter. A ground-source unit never meets that day, and that is why the drop in energy use here beats anything on the combustion side.

The loop field is the expensive part

The equipment indoors is not why a geothermal quote reads the way it does. The compressor and air handler are ordinary machines at ordinary prices. What makes it geothermal is the loop: hundreds of feet of pipe that has to get into the earth.

Six things move that number more than the brand on the box.

• Horizontal trenching. With land and workable soil, a trencher lays the loop in two or three days.
• Vertical boreholes. Without the acreage, or when the trencher hits rock, each bore means a drill rig, a crew and a day rate.
• Soil conductivity. Damp, dense ground trades heat far better than dry sand, so a poor site needs more pipe.
• Open water. A pond or a suitable well can replace the loop field and take a large share of the cost with it.
• Ductwork. A heat pump moves more air at a lower temperature than a furnace, so undersized ducts often need reworking.
• Service capacity. Electrification of the heating load can push an older electrical panel past its limit, and that upgrade lands in the same quote.

So get a site assessment before you trust the price or the reduction. A home energy audit sizes the load first, and a smaller load means a smaller loop, which is where installation costs actually fall.

What does the payback leave out?

Even on the premium, this is a long wait, and it deserves to be called that. Two things sit outside the maths, and both work in the system's favor.

The first is lifespan. The buried loop outlasts the equipment above it by decades. The indoor unit never faces weather, so it runs longer than a furnace and much longer than an outdoor condenser.

Over a payback measured in decades, a conventional setup might be bought twice. Those avoided costs are real money this tool never shows you.

The second is the work the system does on the side. Many units add a desuperheater, which routes waste heat to the water heater. Part of your water heating then comes free in the months you pay to cool the house.

That free hot water is a small line on the energy bill, but the reduction figure usually ignores it.

Where does geothermal heating fit in the energy transition?

Heating is the hard part of the energy transition, because the load peaks in the coldest week of the year. Geothermal heating does not weaken in that week. The warmth comes from the ground rather than fuel, so most state programs count it as renewable energy.

The CO2e behind ground-source heat pumps depends on the grid they run on. That grid gets cleaner as clean energy is added, so the same machine emits less each year without you touching it.

Rooftop solar covers part of what the compressor draws, and pairing the two is the usual electrification path.

Nonprofit research groups and philanthropy back pilot projects for shared, neighborhood-scale loops. Those shared loops are where installation costs are most likely to fall.

Refrigerants are the other difference. A ground-source unit keeps its refrigerant charge indoors in a sealed system. That sealed charge makes a leak easier to catch than on a condenser standing outside.