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Spot on! 
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My brother installed a heat exchange system for his farm in the north of Sweden, burying the pipes 1.5 meters down in a field. It produces enough heat to keep two decent-sized (ca 200 sq.meters) houses warm in winter, and hot water for both. It's not set up to provide cooling though.
He reckons it will have paid for itself after 7 years, though this is helped by him letting one of the houses out with heating included in the rent.
If you have space to install it, I reckon it makes sense. Just check expected lifetime and warranties of all the subsystems.
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My uncle has solar panels on his roof, he assumed that it pays after 15 to 20 years, according to the energy he produces and how much he needs for him self, the overproduction gets "selled".
So basically you have to do the maths according to your need, your probable output and the possibility to sell overproduction?
Solar panels pay off quite late if you don't have horrendous costs. But therefore you can call your self a little greener 
I will mount some on my house, as soon as i build it ^^
For the ground source heat pump, i have no one i know who uses that, but it seems a quite good thingy.
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I"m sure the panels will wear out, fog, oxidize or some other form of degradation prior to the 15 years are up!
George
Retired Chemist
The Irishman
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When we get to the point of parting with some money, Mrs Wife will be in full control. She always is.
veni bibi saltavi
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Nagy,
I've had a geothermal HVAC system for over 12 years. Depending on your costs, I suspect that the pay-back time has been over estimated. I was in profit in under 10. These systems are extremely reliable and there are potentially more benefits than just economics. If your system uses forced air, in winter the air is warm, not hot. In summer the air is cool, not cold. This reduces issues of hot (cold) zones in the house and large temperature fluctuations. This makes it a very comfortable system.
Normally the system should be set up to preheat your how water too(this might require installation of an insulated storage tank or a larger hot water tank to get the full benefit). I have quite an old compressor, there are now available multistage compressors that are a lot more efficient. hence my feeling that you pay-back should be quicker.
My system cost me 35 - 40% of the heating energy and 30-35% for cooling, giving me a savings of over 60%. Cooling gives more savings than heating as your are pumping excess heat into cold water, not warm moist air as per normal air conditioning systems.
Full disclosure: I also have an 8kW solar array, I'm a lifelong self-confessed eco-freak! (I drive a hybrid too).
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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we're in the process of building a house with group-loop heating / AC. there are some big tax credits for it, for us.
we skipped the rooftop solar because of up-front cost, but it's something we'll do later if the money works out.
modified 5-Mar-15 10:01am.
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Nagy Vilmos wrote: it pays for itself in around 15 years.
99.9% of anything you purchase, especially for your home should "pay for itself" withing 3-5 years, not 15.
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Why?
Purely from an investment standpoint, a certain 6.7% return is pretty damn good. It could be that power is cheaper in Hungary compared to installation cost, but 15 years is very conservative in my experience.
If you are planning to sell within the 5 year horizon, you might not get the full value, although it should add to the selling price of the home.
Many things we buy are effectively for consumption and have no payback per se. Even something like a geothermal installation might also improve comfort. and getting a return is a bonus, so the statement is questionable.
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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I personally don't know many people who have been in there home for more than 15 years. Getting a return on your investment in 15 years is totally absurd to me for a heating/cooling system.
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Who said you need to be there for 15 years? Any real improvement in a house is reflected in its selling price.
Again, if you sell in less than 5, you might take a bath, deeper research and advice from real estate professionals would be required as the value of the home is unlikely to be raised by the original installation cost.
You could use exactly the same argument against new windows, a new roof or almost any home improvement. Try selling a house with any major feature missing or in poor repair!
You get a return on your investment in year 1. It's only a wise investment if the return and the residual value (in this case how much it increases the value of the house) is better than placing the investment elsewhere and/or you get some other perceived value.
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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PhilLenoir wrote: Any real improvement in a house is reflected in its selling price.
IMHO, not an entirely true statement.
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So you're saying you think people would pay the same for a house with leaky, compromised windows than for the same house with new double glazing or one that costs 1500 a year to heat and cool than one that costs 500?
If this is true in your real estate market, I suggest that it's not normal.
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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Not the same, but you can't expect your investments to be fully amortised through higher sales prizes! I can tell you from first hand experience, as I'm currently selling my house. As matters are, getting back more than 50% of my investments from the past two years seems highly unlikely. (and that's before fees and taxes, which are raised due to the potentially higher sell price)
At the very least, by asking for a higher sell price you're excluding potential buyers simply because they can't afford it, no matter how much they would be saving in the long run (e. g. due to geothermal heating).
Even for those taking a look, whatever you invested money in may not have been to their liking, or they might have been able to get a better deal for doing the same. Therefore it will not have the same value for them as it has for you.
GOTOs are a bit like wire coat hangers: they tend to breed in the darkness, such that where there once were few, eventually there are many, and the program's architecture collapses beneath them. (Fran Poretto)
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Stefan,
That's not what I stated. the amount you get back depends entirely on the type of "improvement", how long and how well it was done (and other factors). Sometimes an investment is more than recouped. There's a whole slew of TV programmes based on this (the UK's Secret Agent being just one of these). There are some conditions in a property that are so off-putting that they severely depress the value. Most commonly and perversely, these are usually actually trivial in nature and decorative.
On the other hand, some alterations to a house might actually reduce it's value (e.g. doing something that doesn't comply with building codes or really bad decoration).
I used the term "Real Improvement" to mean something like improved insulation, more efficient heating/cooling, repairing an obvious flaw (a leaky roof). I also used the term "reflected". This does not necessarily mean full recovery of residual value. There are many variables involved in a value of property, but any real improvement will increase the value.
How much an alteration affects value would have to be considered taking these many factors into account. Creating a $2M house next to a municipal dump is a poor investment decision. The person wanting a $2M house will not buy there. Having said that it has more value than a leaky half-standing hovel next door; it's just not a good investment choice.
This sub-thread started with the statement along the lines that you should never make an investment with payback of less than a few years. If this were true, nobody would ever put in new windows, re-shingle a roof .... In my view the statement was a silly one. Many (most?) purchase decisions we make have no pay-back, they are simply consumption. In Economics the terms "list of preferences" and "perceived value" are used; these concepts drive our buying decisions, even investment decisions - Blood Diamonds might have been a good investment, but you'd never find me investing in them.
Back to Nagy's original question: Even a 15 year payback is simply looking at energy expense versus installation cost. What if he'd need to install or upgrade the existing heating system anyway? What if there's no air conditioning and he values AC highly. If he sells the property on 10 years time, how much will the improvement affect the expected price. Finally what about his personal perceived value. All these points are valid and make a mockery of the original post that I replied to. Now if your argument is that you plan to, or are likely to, move in 2-3 years then that makes many major improvements questionable from an investment standpoint. There is a bell curve and timescales and local market conditions and projections should guide such decisions. Nagy's a smart guy (at least when he's off the gin [second thoughts - cancel that, I'm not sure he's ever off the gin!]) and I'm sure he'll figure it out.
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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I can totally agree with that. I just disagreed with your previous, simplified statement.
re Nagy: he doesn't seem to plan selling his home, and therefore making long-term investments may make sense. Of course, if in a couple of years he finds himself in a situation where he needs to move out, that would be different situation, based on different facts. When this happens, he needs to make a new evaluation and minimize his losses (if any). But it's hard to argue with respect to such a future decision without knowing the reasons, so we may as well advise him based on his current intentions alone. I'm sure he's clever enough to realize that selling his house short term will likely incur financial losses, but that's probably true even without such investments (there are always taxes and fees).
Warning him about potential additional losses in case of a 'premature' sale is fair enough, but I take Nagy's post to focus on the question whether it even pays off if he keeps the house. Of course, we could estimate the cahnces he'll sell the house in x years times as a function of x and calculate an estimated loss due to his investment and not getting full payback via the sale, but there are way too many unknowns to get a reasonable value.
GOTOs are a bit like wire coat hangers: they tend to breed in the darkness, such that where there once were few, eventually there are many, and the program's architecture collapses beneath them. (Fran Poretto)
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If you plan on retiring in that location, than a 15 year payoff might be bearable.
You can probably assume some inflation on energy prices that reduces the payoff window.
As you switch from salary to pension, you're monthly expenses could be quite low.
My uncle has had a system like this for about 20 years and loves it. His system required drilling two well shafts a few hundred feet deep. (vertical pipes vs. horizontal pipes)
On a very hot summer period (multiple daily highs over 100F), It managed to keep the house at 80F during the peak heat, and was able to cool to the target 78F overnight.
The integrated hot water tank was scalding hot during this time.
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A neighbor of mine had a system like that. The only problem came when a developer wanted to build in the area surrounding the neighborhood. My neighbor discovered that the aquifer level beneath his house would have lowered enough after the development that it would have rendered his system useless. Fortunately, this was symptomatic of other water problems with the development, and that helped prevent it.
Software Zen: delete this;
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Ground source loops do not rely on aquifers, Only a system that actually pumps water (open loop) relies on such (they also might use a deep well, pond or river for an open loop.)
Ground source, vertical or horizontal, loops rely on heat transfer to the soil. The presence of water (wet soils) might improve energy transfer, but they probably reduce thermal inertia too, so unless the water is mobile and allows convection, the presence of water might actually be a bad thing. In any case it simply means an adjustment in the size of the loop.
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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I have an air-sourced heat pump for about 10 years and it is working fine. You just set the desired temperature and it turns itself on and off to maintain that.
I have heard that if you have a ground source version the ground side loop needs to be away from buildings as it can cause freezing (and therefore expansion) of the soil.
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Ground source heat pump = thousands of currency units, disruptive installation, in most countries negotiating some kind of planning permission etc. etc.
A really good lamb wool sweater = 50 currency units, instant effect.
Just saying!
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I put a solar system[^] on my house. July of this year will be 5 years since it was installed. I would suggest that if you do this, do it less because its a good investment and more because you want to do it.
A few things to consider.
* Even with a 15 year payback, what is the life of the equipment. (will it need to be replaced in 16 years?
* Salespeople are great liars. If they claim it'll do something, take 10% off the claim and see if its still worthwhile. My numbers vs. claim are about 9% less
* Solar panels loose efficiency every year they are on the roof, so they will have much less capacity after 15 years.
Good luck. I'm happy with my system, but I never purchased it as an investment. I consider it tithing to my kid's future health!
Hogan
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That all depends where you are and what the deal is. I know Germany has strong incentives, but I have no idea about Hungary and Nagy is in a better situation to investigate that. Having said that, he was simply asking about ground source heat pumps!
Good for you on the solar. I disagree with you "much less capacity". There are actually 3 different solar PV technologies and degradation does vary between the technologies and the manufacturing quality, but modern panels are typically around 1% residual reduction per year (residual, as opposed to straight line), so 15 years should see a drop of less than 15% (I guess it depends on your definition of "much"!)
For my own system, my 8kW array including microinverters cost about 65k including 13% tax. My wife and I put this through our business, so claimed the tax back. Our income is about 8k pa, so better than 8 year pay back. the panels have an expected minimum life of 25 years, the inverters have 15 year warranties and my contract for supply if 20 years. I may be green, but the "green stuff" really helped make the decision easy!
Life is like a s**t sandwich; the more bread you have, the less s**t you eat.
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I have a closed loop heat pump system. It was expensive. The cost of the drilling for loops was covered by a grant but would have cost 12-13 grand.
The system with out duct work may have cost 6-7 thousand, with duct work 20 grand +. That was with me doing a lot of the work.
Then you need an engineer to size the system for your house. they do a heat loss analysis.
I live in a dome that is super insulated.
The other issue is if the temp is in the near 0 all the time the efficiently drops and makes the system works harder.
I am very happy with the system. It cost me $150 dollars this past February.
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