GEO Talks About Maryland’s GHP Bill

In preparation for a cover story to issued in late-May or early June, Air Conditioning, Heating and Refrigeration News asked Geothermal Exchange Organization (GEO) President Doug Dougherty a number of questions about passage of a bill amending Maryland’s Renewable Portfolio Standard (RPS) to include the thermal renewable energy contribution of geothermal heat pumps (GHPs). His answers provide insights about the importance that GEO places on state and local action to build the industry.

What is your reaction to the passing of this bill?

Passage of the Maryland GHP legislation is a big win for our industry. We applaud the Maryland Energy Administration, the Maryland Public Utility Commission and the Maryland legislature for the collective vision they had in recognizing GHPs as a renewable source of energy. Passage of this legislation provides another option for compliance with the state’s renewable energy purchase requirements for public utilities. The legislation is the first of its kind in the United States, and GEO will use it as a model for the nearly 40 other states that have mandated Renewable Portfolio Standards.

How important is this decision to the future of the geothermal sector?

This is a significant decision. It sets a precedent in giving value to the thermal load avoided by installing a geothermal heat pump to heat and cool a building and provide hot water. Over time, we are convinced that utilities will see the importance of GHPs in their service areas, because every watt that is saved is a watt that is earned for utilities. By assisting homeowners and businesses in installing the technology, utilities will save huge amounts of money on power plants that they do not have to build, and clean air rules they don’t have to worry about.

GEO expects utilities will start up or enhance GHP promotional programs knowing they can claim the thermal offset as renewable energy. GEO also is a proponent of On Bill Financing (OBF), which utilities could offer to help reduce the first cost of geothermal heat pump installation. Utility financing for the cost of the loop makes perfect sense, in that it can be viewed as an extension of the utility’s distribution facilities. OBF can be a cost-effective way for utilities to get renewable credits and giving their customers the most efficient technology for heating and cooling a building and giving homeowners more disposable income and businesses better cash flow.

Does GEO consider geothermal technology a renewable energy source?

Absolutely. GHPs use the ground as a synch for expelling heat from buildings in the summer, then draw back the heat of the ground for the building during the winter months. Furthermore, GHPs use the only renewable energy resource that is available at every building’s point-of-use, on demand, that cannot be depleted and is affordable in all 50 states. We view it as “gridless renewable energy.”

Any chance that acknowledgement of geothermal technology as a renewable energy source will catch on nationwide?

Yes. GEO believes the Maryland legislation will receive national attention. We’ve already shared it with the National Governor’s Association, the National Association of Regulatory Utility Commissioners and National Council of State Legislatures. Many state GHP associations have a copy of the bill. We are promoting the Maryland legislation as the first public policy in the United States that recognizes the thermal avoided load of a GHP as a source of renewable energy. It gives value and special meaning to the term “negawatt.”

The public wants a cleaner environment AND better energy efficiency. A typical single-family home consumes over 70% of its energy needs for thermal loads. GHPs move 3-to-5 times more energy be-tween a building and the ground than they consume while doing so. The renewable energy beneath our feet has great value, and GHPs can provide that value to utilities and their customers. Maryland has figured it out, and GEO hopes other states will follow their lead.