Operating Costs

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Operating costs and paybacks can be evaluated by:

a. Return on Investment b. Simple Payback on Differential Cost, e.g. new construction c. Simple Payback on Total Cost, e.g. retrofit

GeoExchange systems can be best evaluated on the basis of weather history bin-hour or hour-by-hour analysis. The use of degree-day based cost analysis is not considered sufficiently accurate. The importance of an accurate heating, cooling load profile, and where appropriate, domestic water heating requirements must be foremost in the design and decision process.

1. Unlike a fossil fuel heating system a GeoExchange system's cost is nearly linear with heat energy (Btu's) delivered. A non-condensing boiler can add approximately 25% to its cost as its size is doubled, however a heat pump based system, geo or other heat pump type system, can almost double its cost when its output is doubled.

2. GeoExchange is most often selected on the basis of energy savings. Over-sizing a geothermal heat pump, or even a fossil burner leads to short cycling and inefficiency.

3. With respect to environmental concerns, over-sizing and short cycling also promotes inefficient burning of fossil fuels and increased emissions.

4. Over-sizing of geothermal or conventional chillers, increased the requirement for electrical service and attendant installation costs.

Because of these factors, an accurate analysis of the heating and cooling loads is mandatory when designing a GeoExchange system. Sizing rules-of-thumb, e.g. "400 sqft/ton for cooling or 30 btu/sqft for heating" are not sufficiently accurate nor desirable. Accurate heating, cooling and domestic water heating loads and cost estimating are calculated using the following methods:

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