Price differences between Geothermal and air source cooling

Discussion in 'General Discussions' started by HiThere, Aug 6, 2010.

  1. HiThere

    HiThere New Member

    As far as I can tell, there's no significant positive price difference between, say, a 5 ton water-cooled heat exchanger and an air-cooled heat exchanger/Air conditioner with outdoor compressor. There's no need to deal with pressurized copper piping between outdoor and indoor coolant runs by the HVAC contractor for the geothermal install, it's just a couple of pvc runs between the underground loop and the heat exchanger itself. There's little difference in the amount of controls wiring, and zero difference in the ducting. Which brings me to my question: Without consideration of the well drilling, tank, bleeding of the underground loop, etc., why does every single contractor I talk to want between $8-$10k more to do a water-cooled heat exchanger install vs. an air-cooled indoor coil/outdoor compressor for a relatively simple 4-ton install? I know how much the heat exchanger costs, I know there's no significant price difference between the two in terms of hardware, I guess I'm wondering why labor rates for HVAC guys suddenly jump to about $750-$1000 an hour to do water-cooled heat pumps? How do these people sleep at night?
  2. AMI Contracting

    AMI Contracting A nice Van Morrison song Industry Professional Forum Leader

    I'm not sure what you are driving at without specifics, but if you take a package geo and change out an exisiting system, the price ('round here) is similar to a new high end furnace and air source heat pump.
    If you want to compare a conventional airconditioner to a heat pump heating and cooling package unit (of any sort) there will be a large price disparity.
    If you wish to compare heating/cooling duct system to heat pump duct system it is different as well. Larger duct required where operating temps are lower. It's a code and design thing.
    I can install a resi air conditioner in a half day. When I sell a turnkey heat pump there is about 100 man hours with plumber, electrician, excavator etc.
    People have tried to compare the two before, yet there is little comparison. Conclusions born of poor assumptions are not likely to be accurate.
    I sleep well every night.
  3. HiThere

    HiThere New Member

    My prospective install involves no plumbing or excavator work on the part of the HVAC installer (contract for well dig as well as pump, fill/bleed and hookup for the loop to the heat exchanger is handled separate from the quoted price of the HVAC guys)..the two options I have estimates for are a 4-ton water-cooled heat pump vs a 4-ton run of the mill indoor/outdoor air conditioning unit. Either would involve replacement of my gas furnace. My question is, why after 3 estimates is there a $10000 difference between the two, over and above the ~$7500 well dig and hookup of the antifreeze loop?

    As far as I can tell, hardware for both units (indoor/outdoor air cooled AC and water-cooled heat pump, including blower unit and evap coil, etc. for both) hovers around $4k by the time you get everything you need. The ducting work is largely the same between either unit in my install. One install involves the well drilling contractor hooking up the antifreeze loop to a water-cooled heat pump (therefore, it doesn't show up on the HVAC guy's estimate), the other involves some work with the pressurized copper coolant run on the part of the HVAC contractor. The geothermal pump install involves, I believe, re-routing an existing 60 amp AC line to the indoor unit.

    There's no difference here, as far as I can tell, that would account for a $10k price discrepancy, unless someone here wants to enlighten me. For the time being, I believe that a large part of the difference is built into the pricing due to the large government rebates available for the geothermal pump. I can see no other logical reason to believe the heat pump install is double the price of a conventional install.
  4. ciws14

    ciws14 Member



    I though Google did a better job then that...
  5. AMI Contracting

    AMI Contracting A nice Van Morrison song Industry Professional Forum Leader

    care to share both proposals with us? Still a little vague to support your assertions.
    I can tell you there is no way you are getting a high end heat pump and airhandler or furnace installed for 4K, so what are you leaving out?
    Last edited: Aug 8, 2010
  6. waterpirate

    waterpirate Well-Known Member Industry Professional Forum Leader

    He did say "run of the mill". A lot of the contractors I work with will do an air to air changeout and ignor a lot of existing issues with an old system. If they do a geo job they include the correction of a multitude of evils that exist on the system usually as it applies to delivery of the air.
  7. elifino

    elifino New Member

    I'm running into the exact same thing. (See my lengthy post under Open Loop Forum)
    Conventional 4 ton System , 16 Seer = $7k ....Geo 4 ton Climatemaster inside system (ductwork & unit) .... well aready dug, pipping, tank & discharge already in place = $21k

    It seems 30% tax credit and speciality item charges have been added back into Geo price.

    Feedback from owners = "Its a great system ... but your contractor has to know what he's doing ".... How much do you pay for this expertise ? $14k ...or twice the conventional $'s.... OK .... $21K or 3 times = feels like I'm getting skined .

    I paid $8k for the well and outside open loop ... which I'm told is a very good price.
    Now to pay $21k for inside ducts & equipment is over $7k/ton ... doesn't seem right

  8. waterpirate

    waterpirate Well-Known Member Industry Professional Forum Leader

    Keep shopping if you are not happy with your bids. Ask more questions and for a list of refrances from prospects.
  9. Highside

    Highside New Member

    Same deal here

    I ran into the same issue here in west KY. I could have a 5 ton heat pump put in for a little over $7000. 3 quotes for a 5 ton geothermal came in at $14k and above with me being responsible for all of the plumbing and wells. The installers only wanted to set the unit, install the duct work make a 2 foot pvc connection and go. So for some reason all of the installers around here charge twice as much for the duct work when you want a geo unit. The geo unit itself is slightly under $7k so the duct work alone cost as much as the entire heat pump unit and the duct work. Believe me, there is no major difference in the duct work that they installed for my geo unit. Why do they do it? Because they can, I paid it and so do other people. So just lube yourself up real good and pay the money. It is still worth it as long as there is a tax credit. After the tax credit goes away maybe not so much.
  10. engineer

    engineer Well-Known Member Industry Professional Forum Leader

    These are valid points

    I offer some defenses for higher geo system install costs of seemingly similar common elements (ductwork, etc)

    1) Newer Geo installers may be working through high overheads in the form of whatever investments they made to get set up to do geo, such as specialized training, equipment, etc, in today's soft economy. Fewer projects means each has to bear a proportionally larger fraction of the overheads.

    2) Geo is a relatively complex variant of heat pump technology undertaken by relatively few HVAC contractors; in turn they have a heckuva time finding, training and retaining top-quality techs in a soft economy - higher hourly wage costs.

    3) Design and execution interactions with well / loopfield subcontractors consume time and money

    4) Geo units aren't manufactured in anywhere near the numbers as conventional air source heat pumps, so the economies of scale allowing the price cuts we see in consumer products simply aren't present.

    5) Geo contractors, knowing they are selling premium products and services at a high price coupled with highly-educated customers' expectations of economical high performance have to sweat details much harder than the typical junk mail coupon magazine contractor offers of 3 tons for $3k. The geo guy is much more likely to run ACCA Manuals J, D, and S calculations, more likely to measure and evaluate current airflows from existing ductwork and recommend / implement changes changes, and more likely to drill down into the nuances of zone board jumper settings, etc.
    Last edited: Aug 10, 2010
  11. waterpirate

    waterpirate Well-Known Member Industry Professional Forum Leader

    +1 Curt
    All very time consuming, costly, liability issues.
  12. AMI Contracting

    AMI Contracting A nice Van Morrison song Industry Professional Forum Leader

    He also said airconditioner (not heat pump).

    I noticed ductwork mentioned with geo and not with ASHP.

    RE the OP's and others comments, here are some real world details of a recent 2 ton A/C replacement v a recent 2 ton 2 stage open loop heat pump replacement.....
    Install 2 ton R-410 13 SEER central air conditioner with evaporator, slab and lineset man hours 6 (3 installer, 3 helper)
    Install 2 ton, R-410, 2 stage geothermal heat pump with 2 taco solenoids, sediment filter, 2 flow raters, flow gauge, hot water generator, buffer tank, man hours 20 (10 installer, 10 helper)
    Difference between part/labor cost v actual sale price AC about $1,200. Difference between geo part/labor cost and sale price ~ $3,000 making the airconditioner more lucrative as I could do 6 in 3 days vs heat pump 2 in 3 days. Of course there are other costs of doing business so these numbers are not "profit".

    Yeah the geo cost more than 3 times as much, I must be making $1,000/hr!?!?
  13. waterpirate

    waterpirate Well-Known Member Industry Professional Forum Leader

    I missed that, ac and heat pump are not the same.
  14. geome

    geome Member Forum Leader

    Is it fair to say that geothermal systems are more expensive compared to a conventional system? Sure - geothermal systems are expensive. Is the system worth it to you? Perhaps - it depends on the price for the system and the savings.

    Can everyone who wants a geothermal system afford one? Unfortunately not, but the tax incentive can help people buy a system who may not otherwise be able to afford one.

    Is it fair to suggest that high prices are the result of tax incentives? I don't think so (without proof such as pre-tax and post-tax quotes.)

    Should greater experience, skill, training, etc., be compensated better than less experience skill, training, etc.? Should a psychologist be paid more than a psychiatrist (in the same market)? (No, I have not seen either!) (No, I do not need to either.) :)

    Does this mean you should not try to get the best deal you can from a reputable installer? No. Get lots of quotes as waterpirate suggested.
    Last edited: Aug 10, 2010
  15. elifino

    elifino New Member

    Thanks to Everyone

    Met and talked to a lot of helpful people ..... 15 phone calls .... 4 meetings .... & 2 new bids.
    I found a knowledgeable contractor with a reasonable price of $16,975.... installation and ductwork for a 4 ton 30 Seer unit.

    Will post again once we are done and up and running.

    Thanks again for all the help

  16. geome

    geome Member Forum Leader

    Glad you found a better price. Make sure to check all references and find out if you can see some of their installations.
  17. poboy92

    poboy92 New Member

    Late to Join...

    As I am late to Join this convo, I am now also facing sticker shocked for my Geo Quote. I only have gotten one quote. The quote is from one in my area that is highly respected. Multiple positive comments from current and past customers. Including one who the contractor does not know that I even spoke to....

    Well mine is on a new build, so all inclusive duck work, insulation, drilling, system, etc. House is 2400 Sq ft home that is more of long than wide...

    3ton system came in at 39k and 4 ton at 43k...just stunned...I talked to the dealer of the system, who referred me to the contractor initially...was told it would be around 21-24k...Was ready for that, but not this...

    Would like the geo system but not sure if I can find another good source that could give a good quote quickly...BRUTAL
  18. AMI Contracting

    AMI Contracting A nice Van Morrison song Industry Professional Forum Leader

    Did you get a quote for a conventional system?
    If you want an apples to apples comparison, you would get a quote on a 16 or 18 seer ASHP with 95% furnace.
    Were your loops horiz. or vertical?
  19. poboy92

    poboy92 New Member

    I got a quote for a 14 SEER system, duck work and foam insulation (also includes the drilling). That came in at 15k or so, from the builder using his normal package. I sent an email to about 6 more contractors last night who using various vendors.

    The loop is the vertical, 300 ft, 3 holes...
  20. geome

    geome Member Forum Leader

    Unfortunately, getting multiple quotes can be time consuming and subject to the schedules of the installing companies. But, it may be time well spent. Only one way to find out for sure. :)

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