Did you know that 10,000 years ago, the first American Indians built their settlements around hot springs in North America? They used this naturally available source of warm water for cooking, bathing and to keep warm [1]. Without knowing, they had been utilizing the immense reservoir of our planet’s internal heat. Heat that is a great source of thermal energy
Geothermal Energy vs. Solar Panels: Which Has Better Value?
“Going Green” is no longer just for progressive thinking homeowners or those looking to live in a commune and proverbially go off the grid. Instead, having energy efficient property is now an integral part of being a responsible homeowner, not only to lower utility bills, but also as a crucial way of limiting a carbon footprint against an increasingly unpredictable environment. The best way we can lower our impact on the environment (and save some money in the process) is by harnessing the Earth’s resources to heat and cool our homes and businesses. The two main ways to use the Earth’s free energy for your own good are with solar panels and geothermal pumps. Solar panels capture the sun’s rays and convert it into heat and electricity, which is used to heat and cool your home, while geothermal solutions use the constant core temperature of the Earth to warm and cool a property.
The big question remains then: which method offers more return on investment between solar panels and underground geothermal pipes? The answer is provided from a combination of your climate, your existing setup, and how much you’re prepared to invest.
Climate Matters
Although the technology has advanced in recent years, one thing is still necessary for solar panels to work efficiently – the sun. In predominantly rainy or cloudy climates, solar panels will lose efficiency and may provide unpredictable service. Climate will also dictate whether geothermal is a better option as the farther North you move, the more heat is needed during the winters. Because geothermal energy provides up to 500% efficiency compared to gas or oil heating, it’s highly recommended over solar power in colder areas. Coincidentally the farther South you live, the more sunny days you’ll have per year, which means you’ll both need less heat and have plenty of sun available which helps lean towards solar panels.
Upfront Costs
There’s no two ways around it, the installation of a geothermal system is more expensive, especially in retrofits. A horizontal loop geothermal system will need about 400-600 feet of pipe for every ton of heating and cooling energy needed, and although the loops are interwoven, that’s still a lot of excavating. Plus, vertical loops can plunge to depths upwards of 400 feet which makes them no easy system to integrate either. Comparatively, solar panels that are fastened to the roof of a house are a much more traditional application and the units can even be leased in many municipalities. Leasing solar panels can range anywhere from $0 to $3,000 while purchasing them can be a $15,000 or more investment. There are a number of factors (house size, climate, type of drilling) that go into geothermal pricing but an average estimate will be in the $20,000 to $30,000 range.
Long-Term Payback
While initial costs are important to analyze, what many property owners are concerned with are the payback times involved with either a solar or geothermal system. Consumers need to be aware that the initial costs of installing either system shouldn’t be a deterrent because both have payback rates of (at most) about 7 years. When you take into account government tax rebates and escalating fuel costs that range is realistically about 3-4 years. On average, consumers can expect to save around $1,200 per year with solar heating and cooling and about $2,300 with geothermal units. It should also be noted that the installation of either energy-saving system will make a property more appealing to potential buyers which also adds to the ROI.