A little admission: When I wrote last week about forced-air heating, I was feeling a little morally superior, a little bit scoffy, like I knew more about home-heating and -cooling than might actually be true. So it was with great wonder (and a small dose of humility) that I got into this bit of nerdery with Lime reader DeCapeJack about geothermal systems.
Geothermal systems, more technically known as geoexchange systems or geothermal heat pumps, take advantage of the simple fact that, below ground, the earth – by which I mean the soil and rocks and whatnot we walk upon – doesn't really change temperature. Once you dig below the frost line, below where the soil usually freezes during winter, the earth keeps its internal thermostat set around 55 degrees. When it's 5 below outside, the earth is a balmy 55 a few meters below your frozen nose. When it’s a sweaty 105 in the shade up top, down deeper it's still that balmy 55 degrees.
Heating and cooling systems operate on a basic physical principle called heat transfer: Heat seeks out cold and tries to warm it up. Kind of like when our dogs crawl under the bedcovers at night. In winter, geoexchange systems allow the earth's relative warmth to seek out (and warm up) the cold inside your house. In summer, they allow the heat inside your home to seek out the relative cool of the earth. 
[illustration courtesy McQuay International]
So how does it work? Geothermal heat pumps require some sort of access to the ground, either through deep vertical wells or a more shallow field of horizontal pipes buried below the frost line. A shallow field requires a fair amount of land space, while vertical wells need deep holes – like 60 feet deep and about four inches wide. A fluid (usually water mixed with glycol) is pumped through the pipes. In winter, that fluid draws heat from the earth and uses it to bring warmth to your home's heating system – whether that's forced air or a hydronic system like radiant heat. Because the earth's temperature is already close to the temperature you want to make your house or office park or pottery studio, you need much less energy to make it so.
While the operating costs are of a geoexchange system are very low, the upfront installation costs can be very high – unless you've got access to a very large drill, of course. That's not to say it can't be done. DeCapeJack obviously got his holes dug. And then there's this guy, who drilled a 1,110-foot-deep hole beneath his Tribeca townhouse. At least nobody's ever gonna call him a cheapskate.
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Last week I told you I was going to make some pretty little drawings of our house for you using Google SketchUp. Those may take a while. When Internet nerds say something is easy, it’s very different from when I say something is easy. When I say it, I mean that you could do it even while half-asleep; they mean you could do it even if you only got a B-plus in Fluid Dynamics 301. So I think I’m going to stick with sketches made on good ol’ pen and paper for now. Look for some basic outlines of the house soon.
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Jeddadiah, I'm the aforementioned DeCapeJack, and built my home in Delaware, using geothermal. I didn't need a large drill for my 3 60' wells and believe that my break-even cost point will be about 4 years. According to a DOE report of 10 years ago, there were more than 350,000 of these systems installed in homes, schools and business, with an expected annual installation of 40,000 per year by 2000. Frankly, I haven't looked for an updates since, but with the high costs of oil and gas, I suspect that the number must be substantially higher by one.
Incidentally, the feds and many state governments offer grants or tax incentives for home geo systems, which makes them even more affordable.
I just surfed across a great video that was put together by a woman in Michigan, who had a similar system installed. Check it out: http://www.youtube.com/watch?v=Z5rxV3R9RbQ
There's another good video at geoexchange.com on the basic principles.
I would imagine it's easier to install during construction rather than retrofitting, if only because digging giant holes is easier on an empty lot. But maybe DCJ will say differently.
And Jed, here are some Middle America examples of commercial geoexchange systems: the Galt House Hotel in Louisville, KY, which happens to use largest geothermal heat pump in the world (take that, Iceland), and the Linda Hall Library in Kansas City, MO.Sorry, didn't mean to imply that I didn't need any drill. My well guys used the same bit as they used for my potable water. My point was that it was not unusual.
Regarding new installation v retrofit: As any true consultant would always say, "it depends." In general, I agree with phiggs that designing new construction for geothermal would be better than a retrofit. However, if your house already has a hot air furnace system, then I would imagine that you could use that for air exchange.
hey phil,
how about installing a water saving home urinal in your house?
it only uses 10oz of water per flush!
You're always better off starting with the small stuff -- weatherstrip your doors and windows, putting up curtains or insulating blinds, that sort of thing. Aim for the low-hanging fruit, as my friend Blake Jones likes to say.
For instance, a new geothermal system could cost you 18 or 20 grand, whereas reinsulating might cost 1/4 that.