Geothermal Savings Calculator

How it works

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

In summer it runs backwards and dumps your house’s heat into that same ground. Moving heat takes far less energy than creating it, which is why a ground loop can deliver several units of warmth for every unit of electricity it draws, and why efficiency figures above 100% are ordinary here and impossible for anything that burns fuel. One machine does both jobs, so it cuts the heating bill and the cooling bill 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 quietly 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, you are not choosing between spending $28,000 and spending nothing. You are choosing between spending $28,000 and spending $9,000.

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

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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.

Moving heat instead of making it

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 a wall for anything burning something. A heat pump is not playing that game.

It spends electricity running a compressor that shifts heat from one place to another, and how much it shifts is not capped by how much electricity it draws, any more than the weight you can move with a lever is capped by your own arm.

What makes the ground-source version good at it is where it trades heat. A few feet down, the earth sits at a steady moderate temperature all year, indifferent to the weather. An air-source heat pump has to pull warmth out of the outdoor air, which is coldest precisely when you need heat most, so it works hardest on the worst day.

A ground loop never sees that day. It faces the same mild earth in February that it faced in June, which is why the reduction here is far larger than anything available on the combustion side, and why the same machine can turn around and cool the house in summer without a second system.

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 a geothermal quote is the loop: hundreds of feet of pipe that has to get into the earth, and the earth is not negotiable.

If you have land and workable soil, a horizontal loop goes in with a trencher over a couple of days, which is the cheap version. If you do not have the acreage, or the trencher hits rock, the loop goes down instead of out: vertical boreholes, drilled, often several hundred feet each. That is a rig, a crew, and a day rate, and it is why two near-identical houses can get quotes thousands of dollars apart for the same equipment.

The soil matters again after that, because damp, dense ground trades heat far better than dry sand, so a poor site needs more pipe for the same capacity. A pond or a suitable well can change the picture entirely.

The practical consequence: get a real site assessment before you trust either the price or the reduction. The loop is not a line you can value-engineer later.

A long payback, read honestly

Even on the premium, this is a long wait, and it deserves to be called that. Two things make it more tolerable than the raw number looks.

The first is lifespan. The buried loop is the durable part, expected to outlast by decades the equipment sitting on top of it, and the indoor unit lives in a conditioned space and never faces weather, so it tends to run longer than a furnace and much longer than an outdoor condenser baking in the sun. Across a payback measured in decades that is not a footnote: a conventional setup might be bought twice over the same span, and those avoided replacements are real money this calculation never shows you.

The second is timing, and it is the whole point of the premium input. Fitting a ground loop to a house whose system works fine means paying the entire sticker, which is the longer of the two paybacks above, and that case is genuinely hard to make. At replacement time, or in new construction where the excavator is already on site and a conventional system was always going to be bought, the comparison is a fair fight.

If your current system has ten good years in it, the usual honest answer is to wait, and spend the money on the building envelope in the meantime.