Saving $ by Paying More for Geothermal. How’s That?
Putting money into certain energy savings features pays out more than it costs—from day one.
Geothermal HVAC + Energy Star Certification = lower monthly total expense (mortgage + energy) than going conventional HVAC and no Energy Star. Once you get in the weeds just a bit on details, it’s a no-brainer.
Geothermal HVAC will reduce energy bills by at least 30% by itself (not including federal and state income tax deductions for a portion of the installation costs). I had geothermal in a home I had built in 2004. It’s a quiet, comfortable, flexible, multi-zone forced air system that operates quietly, and payback begins on day one. I’ve seen the cost savings.
In addition, like most HomeSource clients, we’re getting the Energy Star Certification, which should generate another 20%–30% savings. And an Energy Star Certified home scores a 5% discount on electricity rates, transferrable at resale.
Benefits and Monthly Costs
So, we enjoy more comfort, less noise, lower costs, and a little bling at resale time. Geothermal isn’t required for the Energy Star Certification, and accounts for most of the $15–20K greater cost going in. But keep in mind: this is not cash out of pocket—it’s part of the loan, figured into the monthly mortgage payment. The extra $80–$85 on our mortgage payment delivers about $110–$140 in monthly energy cost savings. (And, depending on your income tax bracket, a good chunk of the $80–$85 is deductible as mortgage interest, so it’s actually less.) We’re making money on day one. So, it’s not a multi-year payback—it’s instant payback, every month. No-brainer, right?
Third-Party Design Consultant
Monday, we met with Matt Vande, of Vandemusser Design, an independent technical consultant who is evaluating, recommending construction techniques and details, and ultimately certifying that our new home meets Energy Star standards. Bringing Matt’s expertise to bear is part of the normal green building package of HomeSource Builders. Also at the meeting were Henry Snypes, our HomeSource project manager, and Cindy Hipps, HomeSource construction coordinator—both making notes about insulation, windows, and processes. Henry noted that when the insulation subcontractor knows Matt is involved, they send only their best crew to install. Nice.
Matt went over what he would be looking at throughout construction, including:
- Effective insulation
- High-performance windows
- Tight construction and ducts
- Efficient heating and cooling equipment
- Efficient appliances, lighting, and water heater
- Third-party verification
Sometimes, if you look at all the angles, you can get some smart, new perspectives. HomeSource is helping us do that in a big way.