THESE DAYS, IT IS DIFFICULT TO AVOID THE STING OF RISING ENERGY COSTS. WE’VE BEEN FEELING IT AT THE GAS PUMP FOR SOME TIME AND NOW ALSO ARE COPING WITH INCREASED COSTS TO HEAT OUR HOMES. According to the Washington, D.C.-based U.S. Energy Information Administration, the global demand for fossil fuels, such as oil and natural gas, continues to grow much faster than the supply. The agency projects that the natural-gas spot price, which averaged $6.94 per thousand cubic feet in October 2007, will reach a winter peak monthly average price of about $8.65 per mcf in January. Total U.S. natural-gas consumption for 2007 was expected to rise by 4.5 percent, primarily because of demand and growth in the residential, commercial and electric-power sectors.
Ballooning energy bills hinder building owners’ abilities to allocate future expenditures to what is needed: new jobs, equipment upgrades and maintenance. Organizations with large building portfolios, including health-care providers, colleges and universities, and K-12 institutions, especially are vulnerable to sharp cost increases. For most commercial and residential buildings, geothermal-based heating-and-cooling systems could provide a practical solution to the increasing burden of energy costs, primarily that of natural gas.
Unlike conventional heating-and-cooling systems, geothermal HVAC does not depend on natural gas. Still, many building owners believe the first costs of geothermal systems are far too large to justify the initial expenditure. As a result, geothermal systems often are not considered as an alternative to conventional HVAC systems, get overlooked or are value engineered out of a project.
SETTING THE GROUNDWORK
If the building owner is open to considering all possible options, the successful geothermal application begins with a simple feasibility study based on a 20-year payback. The feasibility study coupled with a building energy model iscritical for determining whether a particular system makes financial sense in the first place. In most cases, paybacks under eight to 10 years are considered acceptable. Life-cycle cost analyses will provide a clear comparison of various geothermal options and other types of high-performance or conventional HVAC systems. The results of the energy studies combined with historical data about other successful installed applications make the geothermal option difficult to refute. The results also equip owners with sufficient evidence for discussing the system to others involved in the approval or funding processes.
For example, a geothermal system was chosen for the new Southwest Education Center located in Tinley Park, Ill. This is Moraine Valley Community College’s first excursion into sustainable-building design. A simple cost-benefit analysis revealed a 35 percent reduction in energy and $24,000 in potential annual savings compared with conventional HVAC systems based on current energy cost data. The Southwest Education Center will serve as a model for future sustainable development for this college, as well as the community of Tinley Park.
HOW GREEN IS THE OWNER’S BUSINESS PLAN?
The successful implementation of a geothermal system may depend on the owner’s views about sustainability in general. “You need to hear them out to determine if they have a green conscience,” says Keith O’Higgins, president of Elgin, Ill.-based Metro Design Associates, a consulting engineering company. “If they’re locked on getting the most ‘brick and mortar’ for the least up-front cost, you’re probably not going to be able to convince them to consider geothermal.”
Owners who are fixated on first costs, such as developers seeking a quick return on investment and short paybacks, are unlikely to be swayed no matter what the data about long-term savings suggests. O’Higgins cites a 20 to 25 percent premium for geothermal systems, based on the size and type of system, which results in a 25 to 50 percent lifetime energy savings compared with conventional systems. If clients are interested in sustainability and long-term energy savings, geothermal becomes a much more viable option.
THE ARGUMENT FOR LONG-TERM SAVINGS
Although growing, the number of building owners banking on long-term savings still is small, considering available geothermal performance data. The cost and energy issues really should be framed in terms of the owner’s mission and vision, as well as his or her environmental responsibility. An abstract number of $100,000 saved by using energy-efficient geothermal systems during a period of 20 years means very little until it is translated into its equivalent in salaries for new employees or building improvements and equipment upgrades, for example.
It is important to understand how particular industries or building owners invest in building improvements and relate possible long-term savings to their future operating budgets. “Most public schools have separate operations and construction budgets that do not intersect,” says James McDonough, director of education at Legat Architects, Chicago. “This simply does not promote investment in energy-efficient building systems when the need for classrooms is so crucial.”
A simple cost/benefit analysis may reveal that for every $10 spent on high-performance construction, $30 is saved in future building operation-and-maintenance costs. The initially “expensive” geothermal system will in fact be the least expensive option if viewed during 50 to 70 years of operation, which is the typical useful life for most education institutions. “School boards should understand that if they sacrifice long-term savings for perceived lower front costs, they may back themselves into a corner when it comes to future growth and their ability to manage the rising cost of energy,” McDonough says.
Lack of information about geothermal systems’ benefits and reliability often is the biggest impediment to their use. Some will argue that geothermal technologies are too new, exotic or risky to implement. This myth can be dispelled by referring to the Washington-based U.S. Department of Energy, which states geothermal pumps have been in use in the U.S. since the late 1940s and consume 25 to 50 percent less energy than conventional heating-and-cooling systems. In addition, the Washington-based U.S. Environmental Protection Agency notes about 40,000 geothermal heat pumps are installed in the U.S. each year with cost premiums typically returned to the owner in energy savings within five to 10 years.
Geothermal systems often provide the most cost-effective option for heating and cooling during the life of a building. Architects and engineers could play an important role in the decision-making process if they provide solidempirical evidence backing up the payback analysis and long-term economic benefits.
As the case-study data builds and contractors grow more familiar with installation, geothermal systems should become more common. In the meantime, it’s up to experienced design teams to help building owners overcome the first-cost sticker shock and focus their sights on the long-term economic benefits.
>> VUK VUJOVIC is director of sustainable design for Legat Architects, Chicago, and a co-chair of the American Institute of Architects’ Chicago Chapter’s Committee on the Environment. DOUGLAS J. OGUREK is a member of the Sustainable Task Force at Legat Architects, Chicago. Comments should be directed to Vujovic, who can be reached at Vujovic can be reached at firstname.lastname@example.org or (312) 756-1266.