Geothermal solution could cut your energy bills by half and carbon footprints by 80%

Dandelion Energy, a New York-based company, founded in 2017 by Kathy Hannun, is devoted to dispelling these myths and giving American homeowners an easy option to transition to geothermal energy.

For the general readers, geothermal heating and cooling systems tap into the ground around five feet below the surface, which maintains a relatively constant temperature year-round. This constant Earth temperature is higher than average winter temperatures and lower than average summer temperatures — around 55 Fahrenheit (12^oCelsius).

Geothermal systems use this difference in temperature to transfer heat between buildings and the Earth to warm or cool homes and office spaces depending on the season. Earlier this year, we reported how Geneva Airport planned to use it in tandem with its solar panels.

Dandelion’s geothermal solution meant for homes allows households to reduce their energy bills by over 50 percent while also reducing carbon emissions by as much as 80 percent.

At the center of the system is a geothermal heat pump equipped with Wi-Fi-enabled monitoring to respond quickly to the needs of the household. This is coupled with buried pipe systems called ground loops which circulate heat by transferring circulating fluid.

During summer, the geothermal system draws heat from the air in your home and transfers it to the ground. During winter, it draws heat from the ground and transfers it to your home.

Prior to founding Dandelion Energy, where she is now the President, Hannun worked at X, Alphabet’s innovation lab. A Stanford graduate with a Master’s in Computer Science and Bachelor’s degree in Civil Engineering, Hannun believes that climate change is the biggest challenge of our times.

Interesting Engineering (IE) spoke to Hannun for an exclusive interview. Here are the excerpts of the conversation that has been lightly edited for clarity.

Interesting Engineering: What convinced you about the potential of geothermal energy?

Kathy Hannun: I became convinced about the potential of geothermal for heating and cooling when I learned that residential heating accounts for approximately 10 percent of total U.S. emissions, and geothermal heat pumps are both the most efficient technology out there, and the most cost-effective to operate. In addition, they make the grid more efficient by reducing summer and winter peaks. It’s not often that a solution aligns the incentives of so many different stakeholders: homeowners and utilities, and society at large through its positive impact on climate and air quality.

It took me about one year from becoming convinced about the potential of geothermal heat pumps to start Dandelion.

IE: Why do customers sign up for geothermal energy?

While different customers have different motivations for signing up with Dandelion including savings, environmental concerns, indoor air quality, and want the convenience of an all-in-one heating and cooling system that doesn’t require fuel delivery, the driving factor for most of our customers is savings.

IE: Geothermal energy installations are costly. How to reduce the cost?

Dandelion has tackled the problem of upfront costs from a few different angles:

We’ve adopted the lower-cost drilling methods used for geothermal installation in Sweden and introduced them in the U.S. The Swedes install geothermal wells for about 25 percent of the cost of what they tend to cost in the U.S. While some of that is due to favorable geology in Sweden, much of it is due to lower-cost equipment and methods. We’ve brought these to market for our installations.

We have a proprietary data set of ground thermal conductivity measurements from across the U.S. These measurements allow us to size the ground loops more precisely than was previously achievable, and this precision saves us on the order of 30 percent off our drilling cost.

In the past, geothermal has been a boutique, very specialized enterprise, but this makes systems more expensive. We have streamlined our installations and developed them for scale. By standardizing our processes, we have been able to obtain better pricing from our suppliers and reduce the cost of custom design and parts, which we can then pass on to our clients.

Lastly, we make financing easily available to homeowners, so they can pay nothing upfront for their system and instead pay for it over time. This has been vital because the monthly repayment is often less than the homeowner was paying before for heating fuels, so they can pay nothing upfront and immediately come out ahead financially over their legacy solution.

IE: How long does the installation usually take? Do property owners need to obtain certain council permissions?

Installations do need to be permitted, and Dandelion takes care of all required permits before the installations begin. A typical installation will take about 2 days to install the ground loops, 1 day to tie those ground loops into the home, and then 2 days to install the heat pump. These phases don’t typically happen back-to-back, but we’re working to minimize the wait times between phases.

We are working to further shorten those installation timelines so that a typical installation only takes 1 day for the ground loops, 1 day to tie the ground loops into the home, and 1 day for the interior installation.

IE: How does Dandelion generate revenue?

Today, Dandelion makes money by charging a margin on the installation. Geothermal heat pumps offer such significant savings relative to the legacy fossil fuel options homeowners are using that Dandelion can charge the margin we need to run our business while still offering homeowners significant savings.

IE: Your services are currently available in a few locations. What are your plans for scaling up?

Because the market for residential geothermal is so large, we’ve been able to grow our business very quickly without expanding past NY, MA, and CT. That said, we aspire to be a national and then international company. We prioritize our locations for expansion based on where we can save homeowners the most money. This tends to be a function of factors such as the type of fuel customers are using in a given region, the climate in that region, and the level of incentives offered.

IE: What was the impact of COVID-19 on your business?

COVID-19 was the forcing function that transitioned us from in-person sales to virtual sales. We realized through the experience of transitioning that virtual sales were actually a more effective option for us, regardless of COVID.

IE: Does geothermal energy work the same everywhere?

Geothermal is similar to solar in the sense that it will work anywhere, but some regions will offer a better payback to customers than others. The regions that offer the best paybacks are the ones where homeowners are paying the most for heating and cooling today (which is a function of what fuels they’re using and the weather in their area), and what the incentives are like from the state and utility.