Unless there is a sign on the property, you typically cannot see when a home is heated and cooled with an earth energy system, geothermal heat pump, or geo-exchange system (common names for the same thing). Earth energy systems use the ground to create heating and cooling, so as you would expect, most of the system is buried underground, invisible, conveniently out of the way, and silent. Earth energy is one of the most efficient renewable energy systems available, and is always available for use.


Dirt is something we’re accustomed to standing on, but not something we typically think of as a battery. Earth energy systems store and extract heat energy from the ground in much the same way as your fridge extracts heat from its interior. The compressor circuit in your fridge takes heat out of the inside of the unit (making it cold) and moves that heat out into the room. The same process also works in reverse, where you can take heat from the room, and move it into the refrigerator. That’s essentially what a heat pump does: move heat from one space to another. Geothermal or earth energy heat pumps take advantage of the fact that the earth’s temperature below a certain depth (5-6ft) is a relatively constant ~10 degrees C all year, making it a very large, very predictable, extremely efficient battery of heat energy regardless of the outdoor air temperature. By installing looped pipes either horizontally (in trenches) and/or vertically (in bore holes), heat pumps can pump fluid through the ground just like your fridge compressor pumps fluid through the coils on the back of your fridge, and can then cool or heat your home with the energy stored in the earth. For a complete description of the technology, see the ontario geothermal association website.

Get Started

Before you start your project, we encourage you to:

Step 1 – Assess your site:

For an earth energy system, you’ll likely need somewhere you can drill deep holes on your property. Call your local municipality and utilities and get them to locate your underground services for you (gas, electrical, telephone/cable, water and sewer), and make sure you have at least a 3-4m (10′) diameter circle clear of any underground obstructions available for drilling. This circle should be accessible to the road, be clear of overhead trees or wires (so that a tall drilling rig can fit), and should be reasonably accessible to your house (so that pipes can be installed underground from the drilling site through your basement wall into your water heater and furnace or ventilator). If you have open fields or ponds on your property then you will be able to consider less expensive horizontal loops instead of vertically drilled loops.

Step 2 – Check out installers:

Get references and quotes from local suppliers, including the local dealers listed on The Hayter Group and GeoSmart Energy websites. The Earth Energy society suggests a list of questions that you might ask prospective dealer/installers.

Step 3 – Check your budget numbers:

An earth energy system can save up 75% of electricity costs in an electrically-heated home and is also well worth checking out if you’re replacing an older oil, gas or propane furnace. For other options, refer to our Costs and Incentives page.

Step 4 – Do your project!

Geothermal projects are relatively simple for the purchaser. The most important thing for you to do is get quotes and references; the installer will do all the grunt work. If you’re a “do-it-yourselfer” then you’ll want to ask lots of questions about what size of pump you need.

Here are some mistakes others have made that you should be aware of:

  • Poorly sized heat pump: Getting a heat pump that was either too big or too small will likely result in you spending more money on electricity (running a poorly sized pump) than you will save.
  • Improperly sized ground loop: While it’s true that drilling is expensive, the worst mistake you make on a geothermal installation is to undersize your ground loop. A loop that’s too small will result in your pump running more than it should, using more electricity than it should, and it may even cost you more on your electricity bill than you will save.
  • Read the installation contract: Make sure that you’re not responsible for cleaning up your yard and repaving your driveway! You’ll want to make sure that your contract clearly states that the installer will leave your property as they found it, landscaping and all.

Step 5 – Tell your story:

Tell your family, friends, neighbours, work-mates, and please tell us! We want to know about your project, particularly if you decide to add a solar hot water heater to your system. We may even ask you if we can post a picture of it in our photo gallery. Please send submissions to

Costs & Incentives

If you’re like most of the members of CREW, then one of the only things preventing you from having your own renewable energy system is money. In that case there’s some good news. Below is a summary of some of the financial incentives available that could help you finance your project:

Net Metering

Ontario’s net metering regulation allows you to send electricity generated from renewable sources to the electrical grid for a credit toward your energy costs. Your utility will subtract the value of electricity you supply to the grid from the value of what you take from the grid. What you’ll see on your bill is the “net” difference between those two amounts. If you supply power that is worth more than what you take from the grid over the billing period, you’ll receive a credit that can help lower future energy bills. Net Metering tends to be best suited to situations where you are confident that you’ll consume all the power you generate on site.

Capital Cost Allowances

Corporations who install renewable energy systems can write-off the purchase value (capital cost) of their systems as a (Federal) income tax deductible expense taken against the income they receive from generated electricity. For more information, ask your accountant about class 43.2 and class 43.3 of the Federal Income Tax Act.

“Green” Loans

Some financial institutions now offer special financial packages for energy efficiency improvements.

Alterna Savings offers a green loan to be used for energy-efficient assessments and retrofits to homes and businesses. The Alterna Green$aver Improvement Loan will provide accessible short-term financing to residential and commercial clients wanting to upgrade their homes and businesses to be more energy efficient.

Citizens Bank of Canada offers a “green mortgage” at competitive rates that are designed to increase the energy efficiency of homes and reward homeowners for doing the right thing for the environment. Each “Green Mortgage” holder in selected areas in Ontario receives a package of incentives, including a blue curb-side recycling box containing ten compact fluorescent light bulbs, a registration rebate for a Green$aver Home Energy Audit, product samples, and coupons for trees, renewable power, car-sharing, and other environmental products and services, with a retail value of over $800.

Mindscape Innovations, based in Kitchener, offers a mortgage refinancing solution that will leverage the value of your home to free up funds for a renewable energy project. If you have equity invested in a home, and are open to refinancing your mortgage, you could free up enough funds to do a renewable energy project, consolidate a car or other loan, get a rate below prime, and still end up with lower overall monthly payments than you had before. Visit Mindscape’s website for more info.