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Community and Q&A

Geothermal Heat Pump vs. Air-Source Heat Pump vs. High-Efficiency Furnace

katiesharrowreabe | Posted in Mechanicals on

Patrick suggested I’ll get a few responses to this query, so here we go!

I expect my oil burning furnace to die soon and am proactively planning my replacement. Would you recommend geothermal (GSHP), an air pump (ASHP), or an upgraded high efficiency furnace?

– Zone 5, in New York where there are a lot of green energy incentives
– 2800 sq ft DUCTED home
– Current setup includes an oil-burning furnace, electric water heater, and no air conditioning (sweating with a couple window units at the moment)

– Would do a vertical closed loop install
– Cost before tax credit would be about $28k ($21k post-credit)

– First and only installer I’ve talked to thinks I would need a 5 ton unit due to the size and configuration of the house, and would add/change some ducts to add more air returns. If I keep pursuing this I’ll get another estimate or two.

– Would definitely increase my already very high electric bills. Dream would be to add PV panels at one point.

– Haven’t gotten any quotes yet. In some ways, seems like goldilocks solution (electric and less expensive than geothermal)
– Concerned that even if they’ve gotten better, they might not be enough for my Zone 5 weather and I would need a backup oil furnace to run when it’s really cold. Not sure if I have space in my utility room for that much gear.

High Efficiency Furnace + Central Air:
– The least green, most likely, but also perhaps the biggest bang for my buck.
– Cost difference doesn’t seem significantly less than geothermal (approx $5k, I believe, once tax credits are worked in).

Thanks in advance for all recommendations!

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  1. katiesharrowreabe | | #1

    Also just read "Cost and effectiveness of GSHP vs. minisplits in Zone 5" and Dana's helpful response. That was back in 2016, and I'm guessing if anything, ASHPs have improved and GSHP's only slightly.

    1. paul_wiedefeld | | #10

      Is natural gas available to your home? Or just oil?

    2. Expert Member
      Dana Dorsett | | #16

      >"Also just read "Cost and effectiveness of GSHP vs. minisplits in Zone 5" and Dana's helpful response. That was back in 2016, and I'm guessing if anything, ASHPs have improved and GSHP's only slightly."

      GSHPs have improved as well in that time period. But recent quotes I've seen in my area for ASHP solutions have been off the charts insane, making ...

      ..."– Cost before tax credit would be about $28k ($21k post-credit)"....

      ...seem like a bargain! (Assuming the contractor /designer is competent.)

      One of the guys in my office was recently quoted $21K for a 2 ton low-static ducted Fujitsu on one project.

      Five tons may or may not be right-sized for a 2800' house. (A really tight 2800' house might even be within range of a 3 ton.) Since you have a heating history on the place, run a fuel-use based load calculation as a sanity check:

      At that price point you're probably looking at a single stage or maybe 2 stage GSHP(?), not a fully modulating system like the Waterfurnace 7. Modulation is great for comfort and offers a bit of forgiveness on sizing. With single-stagers getting the size right makes a meaningful difference in comfort & as-used efficiency.

      You may already know about this, but in the Hudson Valley you may be able to use Dandelion Energy for the geo, which has several advantages over small time contractors doing one-off designs. Dandelion does remote monitoring and debug of any systems they install, and have created a palette of cookie-cutter designs that can be applied to almost any pre-existing ducted system. (Their primary target market has been retrofitting their GSHP equipment into existing oil or propane ducted hot air systems.) Cost-wise they tend to be quite competitive due to their access to cheap capital and the streamlined logistics that come with being somewhat larger company creating less idle time (=money) for their drilling rigs.

  2. Andrew_C | | #2

    I'm guessing if you've done more reading on GBA, you'll decide on minisplits. They'll definitely work in your climate. IMO, you'll end up with better comfort and less overall cost in the long run. And you'll use less energy which a primary goal of being green, regardless of how you define it.

    GSHP's require one-off engineered designs. IMO, your chance of getting a good design, proper sized and properly installed, are vanishingly small, and it's not generally low cost either. Save your money and get a good independent analyst to do an aggressive Manual J to properly size your mini-splits.

  3. this_page_left_blank | | #3

    Your concerns about an ASHP being able to handle your zone 5 weather is unfounded. Plenty of people are using them in zone 6.

    5 tons sounds like way too much, unless your house is uninsulated and you have single pane windows that you leave open a crack all winter. Get someone to do a manual J for your house. Don't trust the HVAC installer to do this.

    Yes, the furnace is by far the least green. I also can't imagine how a furnace plus central air is going to be cheaper than an ASHP. The ASHP will be similar in cost to the central air by itself. Unless you already have the central air.

  4. Jon_R | | #4

    Some ASHPs will turn off at temperatures that you will occasionally see. Some don't turn off but do provide a minimum temperature spec that you will violate, which could be a longevity or warranty issue. So choose carefully. Or have a lot of backup heat.

    Most inverter ASHPs provide incorrect CFM/ton at low loads - this means poor Summer humidity control.

    Ducts are generally required to get proper distribution and comfort.

    Do your own analysis when it comes to what is cost effective. Air sealing and insulation probably have a better ROI.

    > thinks I would need a 5 ton ...

    Don't let them guess. They need to do Manual J, S, T, D - and a fuel-use sanity check. If an experienced GSHP installer can do this properly, it's quite likely that they will get the entire GSHP design right.

    Expect a GSHP to provide better efficiency, longer life, better aesthetics and no concerns about icing or snow cover. Also more expensive and more interior noise.

  5. katiesharrowreabe | | #5

    Thank you both for the quick replies! This site has quickly become my favorite place on the internet.

    I'll look more into the cold climate ASHPs. Sounds like dismissed them prematurely. Will also get an independent analyst for the manual J. Thank you!

    I agree that 5 tons seems oversized for my house, although it might be a reality given the CMU construction of my home, which I suspect is indeed uninsulated on at least some of the walls.

  6. paul_wiedefeld | | #6

    Hi Katie, if the oil furnace is the only oil appliance you have, you can pretty easily figure out what size you'll need using fuel usage and Heating Degree Days. Dana's 15-min load calculation article is the first step! ASHP plus PV in the future will be hard to beat.

    1. katiesharrowreabe | | #7

      Thanks for the tip about Dana's article! The geothermal installed told me the load needed but I haven't seen a breakdown of this.

      1. paul_wiedefeld | | #8

        Dana's method is great because it uses real-life conditions and behavior. It's both quick and accurate. In terms of capacity at low temperatures, cold climate ASHPs will handle NY weather no problem and if you get an inverter one the comfort (in my experience) is much better than a furnace.

  7. walta100 | | #9

    From a dollars a cents point of view it is almost impossible to recover the high cost installing the loop for the GSHP in your lifetime.

    Your local cost for fuels would be the biggest factor in making a fuel switch.

    From a comfort point of view it is hard to beat a furnace that will blow 130° air around your home. Yes you can adjust to the lower air temps supplied by a heatpump but it will take time and be an adjustment.

    If you decide on an air source heat pump I think there are 4 must have features that make for a good modern heat pump.
    1 Variable speed compressor.
    2 Variable speed indoor blower.
    3 Two electronic expansion valve.
    4 Communication thermostats made same manufacture.

    My conventional ASHP with my 4 features heats my home down to 6°F with the electric back up locked out. A Hyper heat mini split is likely to work down to -15 or20°F.

    I think before you make a fuel switch you need consider improving your homes shell. Have you had your home blower door tested and the air leaks sealed? How much insulation is in your attic and can you add more? How much insulation is in your walls and can you add more?


    1. katiesharrowreabe | | #13

      Thanks for the reply! I suspect I can adjust to ASHP from a comfort perspective. This past winter we kept the thermostat at 68, and I suspect our place is quite leaky and uninsulated, and we survived. Would I have liked it to be a bit warmer? You bet.

      I agree that the very first thing I should do is seal up those air and duct leaks, and then improve insulation. Those balls are already rolling. I think it'll be tough to get the house as tight as I would like, I just don't know how with an older home, other than sealing up the can lights, around windows, etc. I don't think we have enough insulation on the walls, but the only thing I could do there is get someone to inject foam on the inside of the CMUs. It's possible that's already been done, but I doubt it based on what I'm seeing elsewhere in the house. I am definitely improving the attic insulation and have another post about that. The recommendations that came in there was to keep the attic vented and unconditioned, and seal the floor and add cellulose to get me up to R-49 (or higher). Open to other recs!

      1. paul_wiedefeld | | #14

        Reducing load will help make the heat pump perform more efficiently, so great news on the attic (lower modulation -> greater efficiency). A furnace will have higher MAX supply air temperatures, which is a huge caveat. If a furnace cannot modulate low enough (and the smallest oil furnace is probably much larger than your needs and I don't think many modulate at all), it'll short cycle. If you use a constant circulation fan, that means the air coming from a furnace will be room temp most of the hour, so it'll actually be colder than an ASHP that can turn down lower. If not constant circulation, you'll have a short on cycle, then it'll blow room temp air out of the ducts before the next cycle. So if supply air temp matters for comfort (depends on how much time you spend in front of a register), a heat pump will have less fluctuation and feel less drafty.

  8. charlie_sullivan | | #11

    Check out a company called Dandelion that is working on streamlining the GSHP installation process, getting costs down and reducing the engineering mistakes that are common in those installations. They are working in limited regions but some are in NY.

    Right now, it's hard to justify ground source over air source on net cost. But it's a great thing for the grid--their seasonal average performance is only a little better than an air source (if it's a good unit installed well--a poor unit installed poorly will do worse than air source). But the advantage is much bigger on the hottest and coldest days, when the grid is most stressed. If we can get our act together to start appropriately rewarding consumers who make that choice and thus make grid management easier, it will become more economical.

    Another advantage is that they require less refrigerant and the refrigerant connections are all done in the factory, so there's less chance of climate-damaging refrigerant leaks.

    1. katiesharrowreabe | | #12

      Dandelion is the one geo installer I've spoken with so far. They've been easy to work with and seem to be asking the right questions, but they haven't come out to the house. It's all been virtual, and I admit I wonder if they can do an accurate load calc without actually seeing the space. They're taking my word on my home's duct system, which I'm still pretty unfamiliar with. Having someone out here would make me feel a lot better.

      1. charlie_sullivan | | #15

        So I guess that doing the quote virtually is part of Dandelion's cost-cutting strategy. The quote is in fact much lower than would by typical for a system like that. But I think it's wise to have some skepticism about their ability to assess the situation well without a site visit.

        I think it could be worth hiring a third party to do a load calc. If it comes out to match up with Dandelion's plan, maybe that is a good way to go.

        1. Expert Member
          Dana Dorsett | | #18

          >"But I think it's wise to have some skepticism about their ability to assess the situation well without a site visit."

          Dandelion Energy (a Google spinout) makes heavy use of data-mining, and may already know more about the particulars than the casual observer might be able to conjure up on their own, but yes, it's worth doing your own due-diligence on the sizing.

          Almost all oil-fired furnaces are ridiculously oversized for the heat loads, and as a result have oversized ducts that are easy enough to adapt to right-sized heat pumps. Some amount of duct sealing & insulation & tweaking is surely baked in to the quote, but not a complete duct replacement.

      2. Expert Member
        Dana Dorsett | | #17

        I guess I should have read the thread more completely, eh? :-) (see my comments in response #16).

        At COVID pricing it's becoming harder for ASHP systems to compete with Dandelion in their service area. While cold climate ASHPs can definitely work just fine on both efficiency and capacity in the Hudson Valley, getting the right installer matters, and in the current market won't necessarily beat Dandelion's pricing. A best-in-class cold climate ASHP would be unlikely to beat a Dandelion Energy GSHP on efficiency either.

        This is one of those rare instances where I'm leaning toward GSHP, but get some proposals on modulating mid-static mini-split ASHP solutions, once you have a better handle on the true heat load based on fuel-use calculations. During "normal" times a 4 ton ducted mini-split + strip heat could come in under $20K (under $15K after incentives in some areas, depending on the local incentives.) Applying the difference in up-front cost to rooftop PV will in some cases tip the balance toward ASHP + PV, away from GSHP.

        BTW: At nearly 48K of heating output the 5 ton 2-stage Dandelion would be sub-optimally oversized for my house (2400' of antique 2x4 framed bungalow + 1600' of insulated not fully heated basement.) YMMV.

        Run the fuel-use load numbers &/or an aggressive Manual-J.

        Ideally you'd want to size it so that the low-stage output less than or equal to the calculated 99% heat load, and the high stage puts out something more. The heat load at my house is in 35K-37K range (as determined by both fuel use and Manual-J) making the 41K/33K output of the 4 tonner a decent fit, and the 48K/39K output of the 5 tonner a bit oversized.

        If you're planning on major air sealing and insulation &/or window upgrades the system needs to be designed for the "after upgrades" condition of the house to provide optimal efficiency & comfort.

  9. katiesharrowreabe | | #19

    Thank you again for all of your inputs. I'm at the point of decision, and I'm torn. Here are my options (for my 2800 sq ft home in Zone 5 with medium insulation/sealing). Local 99% design temp is 9F. Dandelion's heating load calc puts my house at 62,000 BTU. I have tried but have not been able to find a third party to do a Manual J. I know, I know, but it's not due to lack of trying.

    Geothermal (Dandelion):
    - $22,000 (after tax credits)
    - 5 ton air handler with 2-stage compressor and variable speed fan
    - Spec is 49,200 BTU at full load, 37,700 at partial load
    - Have a relatively good spot of the yard that won't be too sad to tear up for the vertical loop
    - 10 yr warranty on equipment

    ASHP (American Standard Premium 18):
    - $13,500
    - 5 ton variable speed (outdoor pump and indoor air handler), ducted
    - Spec is 40,780 BTU max capacity at 5F, 50,500 at 47F (per NEEP)
    - We would rely on electric aux/backup, not a separate gas furnace
    - Equipment is on the NEEP CCHP list
    - 10 yr warranty on equipment

    Which would you choose? Dandelion is offering a heck of a deal, but we also don't know how long we'll be in the house (i.e. less likely to recoup the ROI). I'm worried the ASHP won't give us enough heat in the winter, plus defrost mode, maintenance, yada yada.


    1. aunsafe2015 | | #37

      I have that same ASHP (except the Trane version -- but same equipment), and it's great. To me this isn't even a remotely close decision -- the ASHP wins by a mile.

      BTW, one other comment that I'm not sure I've seen made yet. If you need service or maintenance, there will probably be quite a few qualified techs to work on an ASHP. Geothermal... well, at least where I live, I would not have many options. Not to mention, I can only imagine that it would be more expensive to repair if it ever had an issue.

      Again, for me, a very easy decision... ASHP.

  10. katiesharrowreabe | | #20

    If it's helpful, based on the fuel load calc using data from last winter, we were using 49,953 BTU (65 deg) and 54,068 BTU (60 deg). That's assuming a 99% design temp of 9 (not 3.5, as I mistakenly posted above).

    Update: But as a reminder, these numbers are with sub-par attic insulation which we will remedy this summer/fall.

    1. paul_wiedefeld | | #23

      I think the air source will come out ahead, especially if you continue to reduce load with some of the cost delta between the two. The air sealing and insulation will add more comfort as well. The Dandelion price is certainly competitive! Good for them!

    2. Jon_R | | #25

      > using data from last winter, we were using 49,953 BTU

      Note that with a fuel load calc (vs a Manual J), you need to add additional capacity (heat pump or aux) to account for when it's colder than design temp (a common occurrence) and/or winds are high. I understand that Dana recommends +40%, which puts you at 70k (heat pump + aux).

      What is the minimum operating temperature for the ASHP you are considering?

      1. katiesharrowreabe | | #26

        Jon, I included the 40% in my calculation, so the average (~51,500) should still be on track. Thanks for the reminder though!

        I can't find the min operating temp anywhere. Not on the brochure or installation manual. I've reached out to American Standard to find out.

        1. paul_wiedefeld | | #28

          Oh you’re golden then! You’ll almost never use backup heat and allows for more time spent at low modulation.

  11. walta100 | | #21

    If you will be in the house for 7 years or so national average, forget about ground source.

    My gut says there is no way to save 10k in fuel in 20 years over air source.

    If you want real numbers build a BEopt model and enter your local data anything else is just a wild guess. If you build the model understand it is about 20 hours to watch the training on YouTube and build the model.

    BEopt: Building Energy Optimization Tool | Buildings | NREL


    1. katiesharrowreabe | | #22

      Thanks, Walter! Agree that financially it makes more sense to go ASHP, both short and long term. My worry is that ASHP will present issues, primarily that it won't be warm enough without engaging aux heat. Just thinking if my load is 51,500 (an avg of the 60 and 65 temps, though prior to insulation improvements), and the ASHP capacity in low temps is more like 40,780, will it be all right? You mentioned previously you're happy with your setup. What zone are you in again?

  12. walta100 | | #24

    I am in east central Missouri zone 4.

    Over 4 year my heat pump has run time of about 8000 hours in heat mode and 200 hours of electric heat mode many were when we were under construction and before the HP was connected 95 of the 200 is about 3 minutes of back up heat during the 1900 defrost cycles.

    A properly sized heat pump should not have a problem maintaining the temp you set on your thermostat.

    If you existing ducts are under sized for the heat pump you need to keep the house warm the installer may have to increase the indoor fan speed. If your duct placement happens to blow on you in your favorite chair you may not like your heat pump.


  13. marleyandbowie | | #27

    I'd 100% definitely go with the Dandelion system. It may not beat the ASHP in fuel savings while you live there, but the geothermal well will add permanent additional value to your home while the ASHP will be worth nothing in 10 years. Plus, the geothermal system would allow you or a future owner to add a radiant heating system in a future renovation or addition. With geothermal tax credits disappearing in a couple years, your system will actually gain relative value. Plus no ugly outdoor equipment to look at or worry about in storms, better reliability and performance in the winter - to me it would be a no brainer.

  14. kyle_r | | #29

    You mentioned the ASHP is on the NEEP list, can you provide the link? I can’t see how the ASHP doesn’t win. No home buyer is going to pay $10k more for a gshp if you sell.

    Btw I heat my zone 5 home with a 15k heat pump. The home is 2400 sqft, built in 1985. This is by no means bragging, my house needs a lot of work, just a data point. If your heat load is really 50k btu/hr you would be better off spending that $10k on air leaks or insulation.

    1. marleyandbowie | | #31

      "No home buyer is going to pay $10k more for a gshp if you sell."

      Why not? I certainly would and I know my friends that are currently in the market would as well. There is a growing segment of people that care about these things.

      1. paul_wiedefeld | | #32

        I think it’s safe to say that geothermal isn’t sought after by most. If it was, all new houses would have it. Contrast that with stainless steel appliances.

        1. marleyandbowie | | #34

          In my opinion that's because the average consumer doesn't know enough to even pursue geothermal as an option. For most folks, when their old furnace kicks the can they simply call their local furnace service contractor and buy the cheapest replacement they are quoted that works with their existing fuel source.

          1. paul_wiedefeld | | #39

            You're absolutely right

      2. acckze | | #48

        I agree. Gshp will add permanent value to the home. Also- GSHP has a much lower carbon footprint. Some of us are willing to invest more $ for less pollution. Wile i agree with the comment about there being fewer service professionals for GSHP, I believe there are fewer maintenance issues with GSHP. For the price Dandelion is quoting, I would definitely choose GSHP.

        Has Katie finished this project? Any updates?

    2. katiesharrowreabe | | #35

      Look at that! I didn't realize there was a details page on NEEP. Here you go:!/product/25486

      1. kyle_r | | #38

        Because you are going to make improvements on your envelope and may be oversized at 5 tons, I would recommend you see if you can get a Carrier dealer to quote you a 4 ton ducted mini split. This unit (!/product/29997) has a much wider modulation range and it has a base pan heater that allows it to operate down to -20 F. Granted the COP isn't that great at sub zero temperatures it is still better than 1.

        If you want more capacity you could also look at Mitsubishi, but it may be pricey. Something like this!/product/29006

    3. Expert Member
      NICK KEENAN | | #36

      I'd say it's more complicated than that. There may well be buyers willing to pay a premium for a GSHP. However, having a GSHP probably isn't going to change what the house appraises for, which is going to limit how much someone can borrow to buy it, which limits how much a buyer will be able to pay.

  15. walta100 | | #30

    When I was looking a real estate about 6 years ago there were no check boxes for expensive GSHP, Solar panels or triple pane windows because the real estate market does not see them as adding value. I can hope things will change but I will not hold my breath.

    I am not sure in the real world GSHPs last much if any longer or have lower repair bills. The people I have known that have owned them both paid big repair bill and later replaced the expensive equipment with more of the same. Yes the numbers say they last more years. My guess is the ASHP numbers are polluted with data from low end equipment poorly installed on the cheap. There are no low cost GSHP installs.

    Be sure you understand what it will cost to pump the water thru the system note the pumps are often made by a different manufacture and I doubt the energy required run them is included in the low advertised operating costs.

    Note everything I said about undersized ductwork applies to GSHPs

    You may find this forum interesting.


  16. charlie_sullivan | | #33

    Ultimately, I think you have to decide based on your priorties and budget. I personally would choose the Dandelion system, but a lot of what I do that is that I think we need more GSHPs as part of our overall portfolio of climate solutions and I would be excited about being a part of moving that forward. If you simply do it based on your expected total cost of the installation and of electricity, based on a short time horizon for being there, and maybe a small premium for the selling price of the house, you'd probably end up with the air source. But that's not certain either, without knowing future electricity prices and how long you'll be there.

  17. frontrange | | #40

    I'm surprised this is even a debate. $22,000 (after tax incentives) vs $13,500 = $8,500 price premium for GSHP that gives an efficiency improvement during the few times a year when there's extreme cold weather.

    1. katiesharrowreabe | | #41

      Apologies FrontRange, but I'm still unclear on which option you would choose! I can see it both ways, and it seems the other respondents do, too. (A very split crowd!) $8500 is too much for those rare days, or 8500 is totally worth it for those cold days and the longevity of GSHP.

      1. frontrange | | #42

        No need to apologize. $8500 is too much for those rare days IMO.

        If you're really worried about the risk of a really cold snap, then you could price out what backup heat would cost. If backup is less than $8500, then it's a no-brainer to get the cheaper system. You could even wait a year or two and see if the backup is even necessary (I suspect it's not).

  18. AndyKosick | | #43

    If it helps... Don't choose a system, choose a contractor. They should stand behind their design, commission it properly, and be there for you if there are issues. Ask them directly about those three. Which one gives you the best vibe?

    1. katiesharrowreabe | | #44

      I think this is a great tip. As far as ASHP installers, even though there are more of them, I've only been able to get one to come out and give me an estimate. Everyone is slammed. It gives me pause that I only have one estimate, and that they didn't get the info needed to do any proper load calculations, but he had a positive and helpful attitude that not everyone I encounter has, and I don't think they'll disappear if I experience issues after install. That's something...

  19. katiesharrowreabe | | #45

    Thanks again, all! Loved to see that not everyone could come to one easy conclusion. We've decided to go with the ASHP, primarily due to the cost savings. I'm still worried about performance, but I know we aren't the only ones out there with them in zone 5. We have the option to get a wood burning insert for those 1% days and for emergency heat.

    One more question for the group: I have an estimated heating load for the house, based on last winter's insulation (shoddily installed fiberglass). Approximately how much should my heating load decrease once I air seal my attic floor and add R-49 cellulose? 1%, 5%, 15%...? Just want to make sure I'm sizing the pump accordingly. Again, I can't find anyone to come out and do a Manual J for me.

  20. charlie_sullivan | | #46

    It would be easy to estimate the heat loss reduction through the attic insulation with just:

    * The insulation thickness or r-value you have now.

    * The area of the attic, or the footprint dimensions of the house.

    Estimating the reduction from air sealing is much harder. Even with a blower door test it would be guess work how much of it would be addressed by air sealing the attic.

    1. katiesharrowreabe | | #47

      So let's say my attic is 1400 sq ft and insulation is R-49 (an improvement of +R-34, let's say). How do I translate that into my BTUh load/loss? The load I have now was calculated via the fuel consumption method, so not sure how to bring it all together.

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