What Does a Geothermal System Cost?

Are you considering a geothermal heat pump for your Galloway home? While the initial investment is more than that of a traditional system, the long-term benefits are substantial.

Let’s look at the costs.

Be prepared to pay more than you would for a gas furnace, air conditioner, or air-source heat pump. In return, you can expect greater comfort and lower energy costs over the system’s lifespan.

At Comfort Now by Bob McAllister, we understand the price tag might seem daunting. However, we believe this eco-friendly heating and cooling system’s efficiency, reliability, and longevity, coupled with available incentives, make it a wise investment.

Over the years, you’ll also save money on utility bills and replacement costs.

How Geothermal Systems Work

Geothermal heat pumps leverage the Earth’s consistent underground temperature to provide efficient heating and cooling for your home.

Unlike air-source heat pumps that rely on fluctuating outdoor air temperatures, geothermal systems tap into the relatively stable temperatures found a few feet below the surface.

Here’s a simplified breakdown:  

• The Underground Loop:
  • This is the core of a geothermal system. It consists of pipes, typically filled with a solution made from water and antifreeze, buried either horizontally or vertically in your yard.  
  • The Earth acts as a heat source in the winter and a heat sink in the summer.  
    
    
• Winter Heating:
  • During colder months, the fluid in the underground loop absorbs heat from the relatively warmer earth.
  • This heated fluid is then circulated to an indoor heat pump.
  • The heat pump concentrates the heat and distributes it throughout your home via your ductwork or radiant floor system.  
    
    
• Summer Cooling:
  • In the summer, the process reverses.  The heat pump extracts heat from your home’s indoor air and transfers it to the fluid circulating in the underground loop.
  • This heated fluid is then carried back underground, where the earth absorbs the heat.  
    
    
• Efficiency:
  • Because the underground temperature remains relatively stable, geothermal systems operate much more efficiently than traditional HVAC systems, resulting in significant energy savings.
  • They move heat rather than generate it, which is where the large efficiency numbers come from.  
    
    

Key points to remember about geothermal systems:

• Geothermal systems don’t burn fossil fuels, making them environmentally friendly.  
• The underground loop can last for decades, and the indoor heat pump also has a long lifespan.
• These systems provide consistent comfort year-round.  
  
  

What You Will Pay for Geothermal in Galloway

When pricing a geothermal heat pump, one size does not fit all because many variables can influence the cost. What you pay for a geothermal system for your New Jersey home will likely differ from what you see quoted online. Here are a few broad cost estimates as examples:

• Carrier says a geothermal heat pump and installation costs $12,000 to $45,000.
• Forbes pegs the average low cost for a geothermal system at $17,000, the average middle cost at $24,500, and the average high cost at $32,300.
• The Natural Resources Defense Council (NRDC) says geothermal systems cost $15,000 to $40,000.

These ranges vary significantly due to factors like system size, loop type, and soil conditions. For a precise estimate tailored to your Galloway property, consult an experienced geothermal installer like our Comfort Now by Bob McAllister team. We’ll consider your heating and cooling needs, property size, soil quality, and other crucial factors.

What Determines Geothermal Costs?

Installing a geothermal system is more complex than replacing a traditional HVAC system. It’s also more expensive and might not be suitable if your yard is too small or your soil is unsuitable.

Let’s look at some factors that influence the cost of a residential geothermal heating and cooling system.

Here are the key factors influencing the cost:

• System Size: Smaller homes need smaller, less expensive systems.

• Insulation and Weatherization: Proper insulation reduces system size and cost.

• Heat Pump: Brand, model, and efficiency impact cost.

• Labor: Costs vary by location and complexity.

• Soil: Moist soil enhances heat transfer. Dry or rocky soil increases costs.

• Permits: Local permits add to the overall price.

• The Underground Loop:
  • The loop, filled with refrigerant, antifreeze, and water, is the heat exchanger.
  • Horizontal loops (trenches) are cheaper but need more space.
  • Vertical loops (drilled holes) are more compact but costlier.

Tax Credits Reduce Geothermal Costs

Offset the installation costs with a 30 percent federal tax credit for systems installed by December 31, 2025. After 2025, the tax credit expires and will no longer be available.

Rebates Reduce Geothermal Costs

The 2022 Inflation Reduction Act funded state-administered programs that provide rebates for energy-efficient upgrades, including geothermal systems. The funding for these programs is available on a first-come, first-served basis. These programs will no longer be available when the funding is depleted or after September 30, 2031 (whichever occurs first).

• Income-based rebates (HEAR): 50 percent (moderate-income) or 100 percent (low-income) of project costs.
• Performance-based rebates (HOMES): Rebates based on estimated or measured energy savings.

Which States Offer Rebates

As of January 30, 2025, 11 states and the District of Columbia have launched at least one of the rebate programs. Ten other states have approved applications and are preparing to launch.

Call Us for a Consultation Today!

Get a personalized geothermal system estimate for your Galloway home. Our experts at Comfort Now by Bob McAllister will recommend the best heat pump and loop arrangement for your needs. Call us at 609-241-9736 or request service online.

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