Geothermal Energy

Table of Contents

  1. Description of the Technology
  2. State of the Industry
  3. Is a Geothermal System Right for Me?
  4. Basic Numbers
  5. Benefits and Drawbacks
  6. Planning Issues and Regulations
  7. Setting Up and Operating a Geothermal System
  8. Additional Resources

Description of the Technology

Geothermal systems (sometimes called geo-exchange or earth energy systems) provide both heating and cooling by taking advantage of the fact that soil below the frost line remains a relatively constant temperature all year round.

Essentially, they consist of two components:

  1. A closed loop of fluid-filled pipe that runs vertically or horizontally below the frost line or through a pond (more rarely, some geothermal systems use a well-to-well open loop set-up)
  2. An electrically powered heat pump that extracts heat from the loop for heating, or transfers it to the loop for cooling

In winter, the fluid-filled pipe is warmed by the surrounding earth. Inside the building, a heat pump extracts that heat and circulates it either via a forced air system or hot water pipes. If a forced air system is used, the heat pump can be operated in the opposite direction in summer to cool the building.

State of the Industry

Geothermal systems have been used since the early 1900s, but only recently has the technology become widespread. Today, more than a million systems have been installed across North America. Several Ontario farmers have installed geothermal heating systems in their livestock barns, but the practice is still relatively innovative.

Is a Geothermal System Right for Me?

Heat pumps need electricity to operate, so you'll probably need to be connected to the power grid for a geothermal system to make sense.

Geothermal systems can be used to heat or cool any building, including homes, barns and greenhouses.

The cost will vary depending on the type of loop system and the difficulty of excavating trenches for a horizontal loop or drilling boreholes for a vertical system.

Horizontal loops are the cheaper option. Although they require more space, this isn't an issue for most farmers, since the land can continue to be used for most agricultural purposes once the pipe has been installed.

Basic Numbers

A geothermal system costs $3,000-5,000 per 10,000 Btu output to install, according to the Integration of Renewable Energy on Farms website, and $100-150 per 10,000 Btu output to operate. The life expectancy of the heat pump will vary depending on the type, while most pipes carry a warranty of at least 25 years.

Benefits and Drawbacks


  • Can be used for both heating and cooling
  • Provides a steadier indoor temperature than oil or gas furnaces
  • Is quieter than oil or gas furnaces
  • Can also help to meet your hot water needs


  • Installation costs are high
  • Pipe installation is disruptive
  • Pipe repairs can be costly

Planning Issues and Regulations

Contact your municipality to find out about any local approvals or permits required. For open-loop groundwater systems, Ministry of Environment requirements may apply. A local accredited installer should also be able to inform you about any applicable planning issues or regulations.

Setting Up and Operating a Geothermal System

Look for a GeoExchange Coalition accredited contractor to install your system. To qualify for many subsidies, your installation must be certified by the Canadian GeoExchange Coalition.

Be aware that your existing ductwork may need to be modified — check with your contractor.

Once your system is set up, the maintenance is minimal: changing or cleaning filters regularly, having your ducts cleaned and having the heat pump serviced once a year.

Additional Resources


The Ontario Ministry of Energy and Infrastructure offer a good overview of geothermal systems. For more detailed information, check Natural Resources Canada's Residential Earth Energy Systems: A Buyer's Guide and Heating and Cooling with a Heat Pump.


For more information:
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Author: OMAFRA Staff
Creation Date: 22 April 2009
Last Reviewed: 22 January 2014