The Advantages of Geothermal Heat Pumps vs Air Source Heat Pumps

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Today, more than 65 percent of total delivered residential energy goes towards home heating and cooling, accounting for more than one-third of the average family’s monthly utility costs. 

Now, soaring energy prices, urgent climate change realities, and new regulatory standards are prompting homeowners, builders, and buyers to look for more efficient and effective heating and cooling solutions. 

A heat pump offers a compelling alternative to fossil fuel-burning furnaces and other heating mechanisms, lowering costs while reducing a homeowner’s environmental footprint. Whether builders and buyers are retrofitting an existing house or constructing a new home, implementing a heat pump solution benefits people and the environment. 

As more states move to full electrification, air-source, and geothermal heat pumps become the two viable options when new building codes require it. As more homeowners look for cost savings, energy savings, and long-term efficiency, homes outfitted with heat pumps will be important for those seeking energy efficiency-related rebates and all-around benefits to sustainable living. 

As homeowners begin to consider new choices to provide heating and cooling, the process starts with learning the difference between a geothermal and air-source heat pump.

What Are Geothermal & Air-source Heat Pumps

Geothermal heat pumps have been around for over 80 years to leverage the consistent air temperature a few feet below the ground to provide home heating and cooling.

The Dandelion Geothermal Heat Pump is a two-stage, water-to-air geothermal heat pump with built-in performance monitoring. The heat pump is designed for homes that distribute heating and air conditioning using central ductwork and vents. Our system replaces a home’s existing furnace and air conditioning units. Once installed, the Dandelion Heat Pump will meet all of the home’s heating and air conditioning needs.

In contrast, air-source heat pumps transfer heat by capturing and converting outdoor air using a compressor, copper or aluminum coils, and refrigerant to heat a home without combusting fuel.

In most climates, air-source heat pumps offer a more efficient and cost-effective heating and cooling solution than their fuel-powered counterparts. However, because geothermal utilizes consistent ground temperatures, it’s a powerful solution in any environment or climate.

The Benefits of Geothermal & Air-source Heat Pumps

While geothermal and air-source heat pumps offer abundant benefits over fossil fuel-powered furnaces, geothermal systems provide several advantages for homeowners, including:

  • Comfort. Discharge air temperatures are higher and much more stable with geothermal. At the same time, air-source heat pumps will be uncomfortable on cold days unless an auxiliary heating source supplements them.
  • Longevity. Air-source heat pumps have a life expectancy between 10 and 15 years, while geothermal units provide more than twice that amount. Moreover, a geothermal unit’s ground loop is a permanent energy source that will outlast the home with a life expectancy of more than 50 years.
  • Performance. Geothermal systems rely on the moderate consistent temperature of the earth year-round and more easily absorb heat in the winter or reject heat in the summer than air source pumps. Conversely, an air source heat pump must work a lot harder than a geothermal unit to absorb heat from the very cold outdoor air in the winter. Similarly, an air-source heat pump has to work a lot harder to reject high heat temperatures to the outdoor air in the summer when it’s hot out.
  • Efficiency. Because of its natural efficiency advantage, a geothermal system will use the least amount of electricity to heat and cool your home throughout the year, producing the lowest utility bills of any heating and cooling solution.

As the US Department of Energy helpfully summarizes geothermal systems, “Relative to air-source heat pumps, they are quieter, last longer, need little maintenance, and do not depend on the temperature of the outside air.”

Heat Pump Are More Affordable Than Ever

In many cases, installing a geothermal heat pump is more expensive than an air-source system. For many homeowners, the up-front cost of installing a geothermal heating system can be a practical non-starter. 

However, upgrading new and existing homes with eco-friendly features – from geothermal to solar panels – has never been easier or more affordable.  Most notably, in 2022 the passing of the Inflation Reduction Act extends the Energy Investment Tax Credit for clean energy home improvements, providing a 30 percent credit for geothermal heat pump projects installed before January 1, 2033. This credit falls to 26 percent in 2033 and 22 percent in 2034.

In addition, the Inflation Reduction Act of 2022 provides state energy offices with $8.8 billion to distribute to homeowners retrofitting their homes with energy performance improvements like heat pump heating and cooling. In addition to the tax credits, all homeowners will be eligible for rebates of up to $4,000 for energy efficiency improvements, including geothermal heat pumps.  For homeowners earning less than 150% of the Area Median Income, their rebates could be even higher – up to $8,000. It also offers a tax credit for energy-efficiency home improvements, increasing the limit to $2,000 for heat pumps and heat pump water heaters.

New or existing homeowners can acquire Dandelion geothermal for $0 down and as little as $150 a month. Additionally, builders and homeowners can apply federal and local tax incentives to lower the cost of entry, making geothermal installation more affordable for more people. 

Of course, while the upfront cost of a geothermal system is typically higher than an air-source heat pump solution, the long-term cost savings are significant and often offset the price difference. 

The US Department of Energy reports that “Even though the installation price of a geothermal system can be several times that of an air-source system of the same heating and cooling capacity, the additional costs may be returned in energy savings in 5 to 10 years, depending on the cost of energy and available incentives in your area.” What’s more, the agency reports that geothermal heating and cooling is the most efficient way to heat and cool homes, outperforming natural gas, heating oil, and other solutions.

Which Solution is Right for You?

Geothermal and air-source heat pumps offer compelling alternatives to fossil fuel-powered furnaces. They are cleaner, more efficient, and more affordable than traditional heating and cooling systems, allowing homeowners to respond to rising energy costs, urgent climate change concerns, and shifting regulatory standards with a heating and cooling solution that works.

For example, using a geothermal heat pump in the Northeast will have 40-50% fewer emissions and operational expenses than a comparable air source pump. Additionally, ground-source heat pumps are twice as efficient, and they don’t require auxiliary heat in the winter. Regardless of the higher upfront installation costs, long-term geothermal is the better solution for most consumers.

Air source heat pumps also tend to require a large compressor outside that is both noisy and not aesthetically pleasing. In contrast, geothermal is below the earth – not visible and the heat pump sits inside your typical basement mechanical room where your traditional heating and cooling equipment would be.

For most people, a geothermal system is a better alternative to air-source heat pumps, providing more efficient and effective heating and cooling with longer-lasting results that save money and optimize energy consumption.

To learn more about Dandelion geothermal or to see if your home qualifies, visit or contact us today to connect with the Dandelion Energy team.