Cost and Savings Comparison for Ground Source Heat Pump with Storage

ASG asked excellent questions concerning my previous article about a conceptual ground source heat pump with storage( for those who don't normally read this blog, please see the previous article). The questions: What are the incremental cost and payback for such a system? In so doing, he has demonstrated that he is a man after my own heart. I was, just last week, regaling my son with stories about how I used to demand answers to these questions before approving any project or change to a project, back in the old days.

Unfortunately, I'm not well prepared to give a good answer at this point. The plan was conceptual. No sizing, lay out or detailed specifications have been done, and I am not particularly familiar with labor rates in the area.

Even so, the questions deserve at least a rough, conceptual answer, so let's take a shot. Assume the system is for a well insulated 2000 sf house in North Carolina, which might normally be equipped with a high efficiency HVAC and heat pump, as well as an electric resistance water heater. Further, assume such a house can normally be expected to have an electric bill averaging $100/month, or $1200/year, of which 20% ($240) is used by each of 3 systems; space heating, space air conditioning and hot water heat.

The basic heat pump set up ( motor, compressor, freon piping and heat exchanges) for my concept should be significantly less expensive than that in the basic house. There are several reasons for this:

• Because the system does not have to be sized for the maximum load of the hottest afternoon and coldest night of the year, the system can be significantly smaller, say 2 tons instead of 3.
• Heat exchangers can be smaller, even relative to the heat pump size, since they will have a substantially higher exchange rate for water than for air.
• The expensive copper pipe runs will be much shorter.
• Because the system will be using both the hot and cold sides of a normal A/C configuration, the expensive heat pump addition of valving, switches and controls is not needed.
• Since it will never need to tap heat from the coldest night, a resistance heat coil will not be needed.

As a result, the cost of the heat pump will cost at least 1/3 less than the basic system, say $2000 instead of $3000, for a savings of $1000.

Generally, the increased cost of a ground source heat pump is related to the ground piping which acts as a heat sink. Typically, this might require 300 feet of pipe buried horizontally in the ground for each ton of A/C. Assuming $2/foot for 900 feet (3 tons at 300/ft each). The incremental cost is $1800. This would be lower for a pond installation due to both lower labor and improved heat exchange in water vs soil. If space is an issue, the pipe can be installed vertically in a well, but costs would be higher due to drilling costs. Actual incremental cost might be a bit lower, since you could eliminate the resistance coil, but this is probably minimal in the grand scheme of things.

For my concept, we need only 2 tons of capacity, plus some of the heat sink duty is taken up by the use of the waste side of the heat pump and cross exchange between the hot and cold side. As a result, ground piping, and its cost, can be reduced by at least 1/3, to $1200.

To make this possible, you need the heat storage reservoirs. There are many ways you could do this, each with its own advantages and disadvantages, as well as cost. For purposes of this exercise, assume a 4'x8'x2' plywood/wood frame box lined with pond liner, set on a concrete slab and insulated (both slab and box) by styrofoam. This should be adequate for matching heat and cooling loads over 2-3 days and to allow averaging of heating and cooling loads over a 24 hour period, at a cost of about $500 per box, or $1000 total.

So, overall, the incremental cost for a ground source heat pump would be about $1800 for the ground loop. For my concept, the incremental cost is about $1200 ($1000 for the boxes plus $1200 for the ground loop less $1000 reduction of the heat pump cost).

Then, consider the savings. A normal high efficiency air source heat pump could be expected to have a COP (Coefficient of Performance, or ratio of heat/cooling generated to energy input) of about 3. Since the ground temperature in North Carolina is about 70 degrees Fahrenheit, the temperature difference against which the heat pump must work for both heating and cooling is very low. Assuming a design with about a 20 degree temperature approach for the exchangers, the ratio of total temperature difference for the ground source heat pump should average about half that for the air source heat pump, say 20 degrees vs 40 degrees. Theoretically, the COP should be about proportional to the ratio of total temperature difference, giving a COP of about 6. Being conservative, let's assume an actual COP of 5. This would mean space heating and cooling costs would be reduced by about 40%, or about $100 each, annually, for a total of about $200/year. This savings roughly applies to both the normal ground source heat pump and to my concept.

However, the storage included in my concept adds several advantages. It not only reduces system cost as seen above, it increases energy savings. Since the COP of the electric resistance heating of water in our normal house is about 1, the cost of water heating is reduced by a factor of about 5, even in the heating mode. During A/C season the hot water is essentially a free by-product of the system. So, theoretically hot water costs could be reduced by 80-90%. There will be some incremental losses in the lines and booster/emergency tank, but even so, savings on hot water should be around 75%, or $180/year.

So, how does this all work out?

The incremental cost for a normal ground source heat pump is about $1800. This saves about $200/year, generating payback in about 9 years, with ROI of about 10%.

For my concept, the incremental cost is about $1200. It saves about $380/year, generating payback in a little over 3 years, with ROI of about 30%. Keep in mind that savings could be much greater if off peak rates are available. This varies depending on the actual spread of rates, but could be substantial (See comments on previous automation article, which mentions off peak rates as low as $.02/KwH, for example.). All this is sans wind or solar heat inputs, as per the question. However, the heat storage also would greatly reduce the cost of battery storage required to go off grid, should that be in the future. And the efficiency of the system would further reduce the size of any wind turbine or solar panels required.

Again, I want to emphasize that this is very rough and conceptual only. Actual costs and savings should be calculated based on your actual design. And, again, I welcome questions or comments.