Waiting to startup-what is this sensor in my Climatemaster?

Discussion in 'General Discussions' started by Dale, Feb 14, 2008.

  1. Dale

    Dale New Member

    Geothermal Marketing Strategies

    What kind of marketing strategies are being used to move geothermal products around the country? I'm curious if anyone has completed market research showing the characteristics of the typical geothermal customer.

    I installed an ECR DX system in the Dallas area for a new home in 2007. I have begun using a TED to track kwh and costs of the geothermal via their PC interface and it's averaging around $1 day to heat this home. So far, this is in line with the Manual J numbers my HVAC professional prepared for me before I built this home.

    In short, it's working just fine. A group of us are beginning to evaluate geothermal from a business perspective and I'm just curious what kind of business thinking has gone into marketing goethermal.
     
  2. Eric D

    Eric D Member

    Hi Dale,

    Welcome to the GeoExchange! I'm glad to hear you are happy with your DX system.

    As far as answering your question, bottom line, not enough is being done to market geothermal.

    What sparked your interest in geothermal? Chances are other might have an interest in the same way you did.

    Right now, in my opinion, the bulk of advertising comes by way of mouth. Talking about it any place I can will spark interest here and there. Most of the folks I come across that go for geothermal have some type of engineering background. They are more likely to understand how it all works and seem to be more excepting of the savings you tell them they will get. Others sometimes think you are handing them a line of Bull Ship. References and numbers will sway some folks, but until they have a family member or a close friend show them the new geo system they had installed they wouldn’t even consider having one.

    Regards,

    Eric D
     
  3. Dale

    Dale New Member

    Geothermal Marketing Strategies

    Eric,

    The upside to engineers "getting it" is that if they don't there is a real problem with the product.

    Every product has a customer profile...a sense of what the typical customer looks like, what they eat, how old they are, how they dress and, more importantly how they think. My research, so far at least, indicates the typical geothermal customer profile is 55+ male. This demographic lived through the 70s energy crisis and, apparently, haven't fogotten the experience.

    The next group where this product resonates is 18-34 year old males. Haven't figured out why yet but the pattern indicates product identification is clearly a male thing. This spells a problem for new construction because the females make most of the decisions when it comes to home features. Being engineers, home builder's get it too but they have to weigh the logic of installing a geothermal unit in a new home vs the granite countertops.

    One thing that is pretty much in everyone's face right now is the "green" thing. Consumers are getting saturated with the buzz and, accordingly, are rightly suspicious of exagerated claims. However, awareness of the need is increasing and, I think, therein lies the marketing opportunity.

    Engineers are good at measuring. I believe the engineers need to measure, install and then measure again to confirm the 1st measurement. If the engineers of the business can deliver confirmed results and then say, oh by the way, this puppy is green, the likelyhood of closing the sale will increase fairly sharply.

    Anyway, if you learn something new abot how best to sell these things, let me know.

    Have a good one.
     
  4. Guest

    Guest Guest

    Case Studies & Testimonials of Success

    I am trying to "market" a geothermal retrofit concept to replace an existing central boiler/chiller system in a 10 floor high rise condominium. The concept is that the existing 2-pipe water system would be converted to pump water from a ground loop system to GSHPs in each of the 292 units and back again.

    People are very interested, but some skeptics specifically want examples of other buildings that have installed something similar. Do you know of any? The closer to Washington DC the better.

    Eric M
     
  5. Dale

    Dale New Member

    high rise condo and geothermal

    Eric,

    I would recommend Googling for Don Penn Engineering and giving him a call. Don has a significant geothermal business in North Texas and may know of a job you can reference.

    You may also consider calling Dr Bose at Oklahoma State and see if he knows of an example you can reference.

    Dale
     
  6. Guest

    Guest Guest

    Thanks, I'll look them up...
    Eric
     
  7. Guest

    Guest Guest

    Dale, I don't know (or really want to know) much about marketing. What I can tell you, is I fall slightly outside of the groups listed in this thread. I have some college education, but never graduated and fall into the 30 something age group. I more of a technology geek.

    I first learned of geothermal many years ago when watching "This Old House". I have not owned a house yet, until now, that I could even consider it - just moved out of a condo.

    I'm also not having much luck finding information regarding local geothermal contractors to even begin to size up my home for geothermal installation. I'm already assuming my appilcation will be fairly pricy as it will be installed into a 85 year old, baloon framed colonial w/radiator heat (read - no central air or duct work). I like the concept of once installed, it will cost pennies to operate - and will enventually pay for itself in energy savings. In theory, it should also add value to the house if/when it's time to sell, hopefully many, many years down the road.

    Hope this helps.
     
  8. Dale

    Dale New Member

    Thanks for the reply. I can probably put you in touch with someone if you can give me a sense of where you are located.

    You might be surprised at the payback on this equipment. Especially in light of the cost of energy these days. This energy thing is getting beyond brutal and it never hurts to get smarter about smart ways to get relief. Geothermal is certainly a smart way to go.
     
  9. Guest

    Guest Guest

    Alaska

    Hi Dale, I just read your post to someone else on this forum. I live in Alaska and cannot find a single contractor or HVAC company that installs these units. There must me someone up this way installing them. Any ideas?
    David
     
  10. Dale

    Dale New Member

    David,

    I looked at the International Ground Source Heat Pump Association web page and there appears to be an accredited installer in Gakona, AK. His name is James Beeter and his number is 907-822-3914. His email is "jbeeter@cvinternet.net".

    Happy hunting.

    Dale
     
  11. Ona

    Ona Member

    Dale,

    If you are still following this forum I have a question. I am in the midst of having a Geo System installed in my home and have been trying to get my contractor to install sub meters so that I can track the geo system, the electric coil backup and hot water heaters seperately (and each on their own sub meter). You mentioned TED what is the cost of this? Is there just a simple cumulative watt meter that can be installed somewhat inexpensively?

    By the way, I am a 36 year old female engineer. My husband is also an engineer, but I am the one who researched the decision to GeoThermal. I hope that this helps in your marketing.

    Good Luck!
     
  12. Waukman

    Waukman Member

    I installed a single sub meter and I used:
    Pulse Output WattNode AC Electric Power and Energy Meter

    As I recall this cost me $300ish
    It works nicely.
     
  13. Dale

    Dale New Member

    They have 3 different units. There is the basic model for $140. The one I bought was $145 which has a USB port for a computer interface. And they have a unit for 400 amp service. I bought the data logging software which is $45 and I recommend it because all the data is compiled in an electronic format. I'm only interested in the performance of the geothermal unit but the software has a load profile feature that can be "trained" to recognize an appliance when it comes on and tracks time-of-use, run-time and cost-to-run. So a single unit with the software should be able to track your geo system, the backup heater and the hot water heater and any other major appliances like an oven, dryer. etc. I just never have gotten into it. Their web page address is www.theenergydetective.com.
     
  14. Ona

    Ona Member

    Thank You!
     
  15. geogeorge

    geogeorge Guest

    Geothermal Marketing Strategies

    Hi,

    IMHO the only way to market this stuff is to get a bunch of high profile installations done. And Marketing is more than just demographics. Its a lot of other stuff like packaging, value proposition (price / performance), etc. I think that the Geo community first has to admit that there are lots of issues will the product. It will never move forward without addressing these and no amount of word-of-mouth can overcome them (IMHO!).

    Here's what's needed to get much wider public access:

    A) Cost - it needs to be cut in half and be able to compete dollar for dollar with air source systems. Its out of the reach of Joe Public

    B) One stop shop - one party does all. Today there too many trades involved and not enough contractors acting as "single points of contact" - plumbing, ducting, electrics, systems / HVAC, drilling - all be done by different players. Logistics is way over the head of Joe Public

    C) Packaging - the drama of drilling and trenching needs to be lifted out of the process. The prospect of digging up your land is pretty hard to deal with. Why is something so essential always so loosely packaged with the system? Drilling is hand-and-glvoe with the HVAC piece!

    These are product issues that need to be addressed before this ever takes off but if you really want to understand how to market it just ask Water Furnace or Florida Heat Pump or one of the other OEMs. They have plenty of knowledge and ideas on this (it is their core business) and would be more than willing to help, I assure you!

    If you want to get into the head of why people make this decision then look into other countries where the technology is more widely accepted. We are from Sweden and there it is pretty common. Geo, called bergvarmt or mountain heat, is the first choice. Everything else is a compramise. Note however that the climate and conditions are specific.

    We are installing one this fall into our 1970's era builder spec home. It has been quite an adventure so far! Here is why we are doing it:

    A) Comfort - existing heat is elec baseboard which is pretty flaky. It beats air source because of the slightly warmer delivery temps + no defrost cycles.

    B) Op cost - true, payback is questionable unless you have it for 15 years in which case it is a shoe in but it will definately drop our monthly bill. The rest of it we are calling a personal investment - it doesnt matter if it pays off. A car never pays off, furniture never pays off, additions and pools and many other things you do around the house never pay off.

    C) Green
     
  16. Dale

    Dale New Member

    Thanks for the reply.

    Coordination of trades is a tough issue. In Texas, they are legally separated so the fix is a statutory one and there is just enough inertia to make changes problematic. The work around appears to be having licensed staff for all three trades working for the same company like you said.

    One of the primary attractions of the DX system is the surgical insertion of the holes. Our well field can be installed from a single 6 foot diameter pit. That takes alot of the drama out of the drilling.

    Our market research indicates the typical customer is someone like myself, a "boomer in transition." We've seen an energy crisis and, accordingly, are receptive to renewal energy. We created "Earth Day" and have a healthy disposable income.

    More recent market data indicates the dramatic run-up of energy costs has left this segment feeling a loss of control over their lives. We were pretty confident we could retire. Now we are not sure we can afford to. Bringing that sense of control back to people's lives appears to be a huge pain point. I know from my personal experience as a geothermal customer, a 10% increase on $40 electric bills doesn't create a whole lot of stress. Even if I am on a fixed income. So, geothermal, I believe, is in a position to address the need for control.

    I am seeing a totally different payback on my equipment though. My payback is 2.5 years with a 30% ROI. 15 years would never work in Texas. Any thoughts on why it is so expensive to install there?
     
  17. geogeorge

    geogeorge Guest

    Geothermal Marketing Strategies

    - Payback: In D.C. area. elec is super cheap (ca. 7 cents). This is some of the lowest prices in the U.S. and it criples any business case. To be precise the "non-simple" payback in our case is 12 years. My analysis says that the payback is extremely sensitive to elec. rates: as rates increase the ROI quickly gets better. There are also a lot of specific items that sway the case: vertical bore vs. horizontal, efficiency of equipment, etc.
     
  18. Dale

    Dale New Member

    You're right about the rates. I sat in on an energy conference in Austin last May and a fellow from Houston said the solution to high prices is high prices. The higher the electric rates, the quicker people are to pull the trigger on the geothermal purchase decision. How much do you guys have to pay a foot for the geothermal wells up your way? We're paying $4 foot grouted in the Dallas/Fort Worth area.
     
  19. geogeorge

    geogeorge Guest

    Geothermal Marketing Strategies

    Not sure. I'd have to ask. All the work that I have been doing so far is specing the drill + the system together. To my earlier point, I dont want 2 throats to choke when something goes wrong - just 1!
     
  20. Ona

    Ona Member

    So, it appears that marketing would be a lot more successful here in the Northeast where there is a greater percentage of people heating their homes with fuel oil. Our boiler was only 4 years old and it still makes some financial sense to replace with Geo. Last heating season we used 1026 gallons of fuel oil. Current rates for fuel oil are $4.99 per gallon. So, a quick back of envelope analysis states that oil will cost me $5K per year (stretched out over 12 months, $416/month). I live in a very high cost per kWh state (12.5 cents per kWh). Even with the extra amount of electricity added to my bill (approximately $125/month stretched over 12 months) I'm still coming out ahead by almost $400 per month! This gives me a payback period of less than 10 years (with interest added). And we had to add ductwork to our home! If the price of fuel oil increases at a faster rate than electricity, then my payback period gets shorter.

    I guess my point is, if people are heating with fuel oil, Geo looks a lot more attractive.
     

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