Program aims to finance geothermal adoption in new construction
Carrier and Orca Energy, a leading geothermal utility provider, launched a new program to make geothermal heating and cooling more accessible in new construction homes.
Orca Energy will provide financing for geothermal earth loops in new residential developments with the purchase of a Carrier geothermal heating, ventilating and air-conditioning system. Carrier, a leader in high-technology heating, air-conditioning and refrigeration solutions, is a part of UTC Climate, Controls & Security, a unit of United Technologies Corp.
The agreement between Orca Energy and Carrier is part of Carrier’s renewed emphasis on geothermal heating and cooling solutions. It comes as Carrier launches a new product line that pairs the sustainability and cost-savings of geothermal heating and cooling with Carrier’s Infinity Series controls. As part of the program, the loop is treated as a utility and a small monthly payment is charged to the homeowner, without additional upfront costs to the developer, builder or homeowner.
“Orca Energy is recognized for its geothermal expertise and its successful utility model that enables developers, home builders and homeowners to cost-effectively install the most energy-efficient option in heating and cooling,” said Matthew Pine, vice president, marketing, Carrier residential HVAC. “As experts in heating and cooling, creating this program is a natural fit. We are thrilled that this program will help homeowners enjoy the cost-savings and sustainability of our geothermal solutions.”
Financing for the geothermal ground loops is gaining prominence to address the additional cost compared to a traditional HVAC installations. Previously, Orca Energy announced a similar agreement with Bosch Thermotechnology to jointly market a geothermal ground heat exchanger and equipment solution to developers, homebuilders, and new home buyers in the United States.
The agreement to collaborate in the U.S. marketplace is intended to solve one of the most persistent challenges facing the geothermal industry: how to overcome builder and homeowner resistance to the initial capital cost of installing the ground heat exchanger. According to the companies, geothermal heat pump systems can save between 30-50 percent in heating and cooling costs. First costs for installing the geothermal ground loop, however, have been a stumbling block the industry has struggled with for years.
Homebuilders who enter into agreements with Orca Energy will receive design, installation, and maintenance services for the ground heat exchanger at no expense. Orca Energy will serve the homeowner as a separate utility provider for the thermal energy provided by the geothermal heat pump system.
Another avenue for financing came in 2014 from Advanced Energy Capital, LLC (AEC), an energy finance company, that it signed a Letter of Intent with EarthPoint Solutions to finance up to $25 million in geothermal loop installations in North America.
"The geothermal industry has been plagued by barriers the most significant being financial. We believe this new model will not only break down the barriers but allow geothermal to be on par with conventional heating and cooling options," said Tim Weber, director of sales at EarthPoint.
The first group of transactions – geothermal loop installations on new construction for commercial and multi-family real estate projects – were expected to fund in the Fall of 2014 and early 2015. EarthPoint’s focus was to save real estate project developer’s money and help them lower their building’s carbon emission footprint.
“The powerful combination of our partner’s renewable energy expertise, and AEC’s credit, finance and structuring expertise should help many companies achieve their goals," said Jack Doueck, principal and co-founder of AEC. “Energy Efficiency groups, including Storage and Geothermal Loop players, are looking for ways to market their products and will now be able to offer a ‘turn-key’ solution for the end-users which they expect will open the door to exponential growth.”
Read more about geothermal heating and cooling.