Blog : Volatile oil markets put spotlight on geothermal
Middle East tensions might be far too complex for the average citizen to fully comprehend. But anyone who’s had to fill up at the pump or have his or her home oil tank topped off over the past few years understands at least one consequence of the turmoil.
According to the Office of Energy and Planning, New Hampshire currently spends $2.6 billion every year importing petroleum products. What’s more, over half of New Hampshire homes require conventional oil for heat.
Some would argue that Granite Staters – and New Englanders writ large – have little choice but to ride out the markets and hope for cheaper fuel in the future.
Not so, says Melissa Aho, owner of Barrington-based Ultra Geothermal.
“To say that oil is the only way amounts to a false choice,” says Aho. “We’re just failing to acknowledge that there are bountiful, clean resources right beneath our feet.”
Aho should know: to date, her company has installed over 800 systems in the Granite State alone – including 48 for the University of New Hampshire’s new student dorms back in 2009.
That doesn’t mean geothermal systems are cheap; in fact, they typically cost 20-30% more than standard fossil fuel systems.
Still, Aho maintains that down-the-road savings make it more than worth the initial cost – if a household is willing to make the initial investment.
“With oil so volatile and unpredictable, geothermal is becoming more relevant and making more sense as an option every day,” explains Aho. “And you don’t get the kind of corrosion with a geothermal system that can ruin a typical fossil fuel system.”
According to the EPA, geothermal systems can save homeowners 60-70 percent in heating costs, and 70-80 percent in cooling costs, compared to conventional systems. When gas hits the $3 a gallon threshold – prices at the pump here in New Hampshire are currently hovering around $3.60 – savings can be as high as 50-70 percent for a geothermal ground source heating system.
With a majority of geothermal systems being in the Midwestern U.S., New Hampshire’s unique, rocky geology can certainly present problems. That’s why Aho tends to recommend vertical closed-loop systems – or a standing column, open loop system – to her Granite State customers.
For all its inherent challenges, geothermal’s green credentials are impossible to ignore: The EPA has called the technology “the most energy-efficient, environmentally clean, and cost-effective space conditioning system available.” Needless to say, it’s a sentiment that Aho echoes wholeheartedly.
“Everything changed five years ago when we realized that – with the volatility of oil – there was a better and greener way,” recalls Aho. “So Ultra Geothermal opened and we immediately shifted our focus to be a heating company that promotes and installs ground source heating.”
Aho is quick to point out that New Hampshire residents can still take advantage of a sizable federal tax credit, which covers 30% of geothermal placed in service before December 31, 2016. That’s something that purveyors of fossil fuel-based systems can’t say – a differentiator Aho has worked hard to highlight.
“The fact that it’s an uncapped tax credit could be a huge selling point to a consumer who may be making the choice between a high efficiency natural gas system and a geothermal system,” says Aho. “I think the more people become aware of this tax credit opportunity and learn about its specific applicability to geothermal, it will definitely help drive acceptance of our technology.”
In 2011, Ultra Geothermal was one of just six New Hampshire businesses honored with a New Hampshire Business Magazine Lean & Green Award. For Aho, the award was a singular milestone in a journey nearly a decade in the making.
"In 2006, when I joined Ultra Heating & Cooling as an employee, we did about 30-50 percent of our business in geothermal," Aho recalls. "I started getting phone calls from people interested in geothermal who found our website, and from there it just kind of took off."
Today, Aho and Ultra Geothermal stand as a testament to the forward momentum gathered by the state’s growing green movement. While she admits green tech still has many a hurdle to scale, Aho is confident that the degree of difficulty – particularly with respect to convincing skeptical consumers – will only get easier.
"If oil prices continue to rise, the renewable energy industry will have a great response to try and fix things," Aho said. "People respond to logic, and they respond to the pocketbook. As long as we can continue to make that case, the sky’s the limit."