How long is the payback period for a geothermal system?

Geothermal systems are so energy-efficient that the payback period is remarkably brief. A study by the Air Force Institute of Technology calculated that it takes on average just seven to eight years to recoup costs.

Your specific payback point depends on factors like local utility rates, excavation/drilling costs, how well your house is insulated, the efficiency of the model you choose, and what incentives your state or utilities provide. Also factored into your payback is the base cost of installing a conventional system if replacing.

One of the best aspects about geothermal is cash flow. If you install a geothermal system, the monthly savings in operating costs generally offset the additional monthly financing cost, resulting in an immediate positive cash flow – especially in a new home. Again, your specific situation may vary.