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Do Geothermal Energy Baskets Pay Off?
Do Geothermal Energy Baskets Pay Off?
20 April, 2011
Term Paper – Energy Economics and Policy
Evelyn Mächler, D-MTEC ETH Zürich
Term Paper Energy Economics and Policy
Table of Content
1. Introduction...................................................................................................................... 3
1.1 Focus of Study ............................................................................................................. 4
1.2 Geothermal Energy Use in Switzerland ........................................................................ 4
1.3 How Geothermal Energy Baskets work ........................................................................ 6
3. Conclusion ..................................................................................................................... 12
A. Appendix ........................................................................................................................ 13
List of Tables
Table 1: Energy consumption 2009 in Switzerland split into the different energy carriers
and energy systems (BFS, 2010) .......................................................................... 4
Table 2: Swiss supply of geothermal energy in 2009 split up in the different geothermal
technologies (Geowatt, 2010) ................................................................................ 5
Table 3: Types and dimensions of conical geothermal energy baskets ................................ 6
Table 4: Types and dimensions of cylindrical geothermal energy baskets ........................... 6
Table 5: Parameters and costs regarding fuel oil heating and geothermal energy use
(BFE, 2005b and RiedoClima, 2008). .................................................................... 8
Table 6: Annual amount of released CO2 -emissions of the fuel oil heating system and the
geothermal energy use............................................................................................10
Table 7: Annual amount of needed electricity and CO2-emissions factors to calculate the
corresponding annual CO2 release of the fuel oil heating system and the
geothermal energy baskets (Geowatt, 2004) ........................................................10
Table 8: Annual amount of released CO2 emissions of the fuel oil heating system and the
geothermal energy use .........................................................................................11
List of Figures
Figure 1: The situation in Swiss households in the year 2009: Percentage rates of used
energy carriers and installed heating systems (Erdölvereinigung, 2009). ………...3
Figure 2: Development of the oil price in the time range 1997 - 2010 and the observable
increasing trend since 2000 (BFS, 2011). .............................................................. 4
Figure 3: Assembly of the needed infrastructure in order to use geothermal energy baskets.
(Geothermie, 2011b) .............................................................................................. 7
Figure 4: Payoff periods of the three different scenarios (detailed calculations in the
appendix).. ............................................................................................................. 9
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Term Paper Energy Economics and Policy
1. Introduction
Due to the fact that people’s living standard increased during the last decades and the
world population is growing rapidly, the energy consumption is increasing worldwide. As a
result, we are faced with an increasing CO2-concentration in the atmosphere and a
probable energy gap.
Although climate change is on-going, non-renewable and CO2-intense energy carriers such
as oil and gas are still used at a high amounts worldwide. For instance, fuel oil has been the
most used energy carrier in Switzerland in the last decades. In the last twenty years, fuel oil
has been used in every second household in Switzerland. Further, other systems for
heating and warm water production such as wood, heat pumps, electricity, and long-
distance heating have only been used by a minor percentage of the Swiss households.
2% 1%
8%
Fuel Oil
10% Gas
Wood
52% Electricity
12%
Heat Pump
Long-Distance Heating
Others
15%
Figure 1: The situation in Swiss households in the year 2009: Percentage rates of used energy carriers and
installed heating systems respectively (Erdölvereinigung, 2009).
The negative climate impact of CO2-intense energy carriers such as fuel oil could be
lowered by using renewable energy systems such as geothermal energy, wind energy,
solar energy, or other existing technologies.
Since fuel oil is used at a large amount, its impact on economy is formidable. The oil price
is dependent on several factors. Two crucial factors are the decreasing oil reserves and
political instability in exporting countries. Both lead to less exports and thus to an increasing
demand of oil in importing countries. Out of this, oil prices in importing countries increase
because demand exceeds supply. In conclusion, the increasing and instable oil price
makes the costs of fuel oil heating systems incalculable. Figure 2 shows the instability of
the oil price during the last decades and the observable positive trend that has arisen since
the year 2000.
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Term Paper Energy Economics and Policy
150
price [CHF/100Liter]
100
50
0
1975 1980 1985 1990 1995 2000 2005 2010 2015
year
Figure 2: Development of the oil price in the time range 1997 - 2010 and the observable increasing trend
since 2000 (BFS, 2011).
Since the oil price is increasing and the use of fuel oil has a negative climate impact, the
question of installing a fuel oil heating system in a new building has become a crucial
question to homeowners. Therefore, this study compares the financial and environmental
impacts of the conventional fuel oil heating system with a sustainable heating technology.
The investigated sustainable heating system consists of a heat pump connected to
geothermal energy baskets. Geothermal energy baskets represent a niche product in the
geothermal energy use in Switzerland but have the advantage of being independent on
fluctuating oil prices and not having a negative climate impact during usage. Besides, all
calculations and further investigations are based on Swiss conditions and prices. As a last
step, the policies regarding the use of geothermal energy baskets are looked at and
discussed.
To give an overview of geothermal energy use in Switzerland, its principle of operation and
the different available technologies are described.
Geothermal energy refers to the use of energy taken from the underground. The use of
geothermal technologies is sustainable and produces heat that can be used instead of oil or
gas to heat a house and produce warm water. In Switzerland, the consumption of
geothermal energy is small and only accounts for 1.0 % of the whole consumption of
energy (BFS, 2010).
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Term Paper Energy Economics and Policy
The technologies in the field of geothermal energy use are various. Their applicability is
dependent on the specific underground as well as the local conditions such as available
space, groundwater appearance, and the environmental standards in the particular region.
Moreover, there are technologies that are used in a more widely way while others are new
and still in research.
The different technologies are categorized into the following utility areas (Geothermie,
2011a):
Table 2 shows to what extend the mentioned categories account on the Swiss supply of
geothermal energy in 2009.
Table 2: Swiss supply of geothermal energy in 2009 split up in the different geothermal technologies
(Geowatt, 2010)
Although the downhole heat exchangers, energy baskets, and underground registers
account together for 73.2 %, geothermal energy baskets take on only a minor role. They
represent the technology with the smallest percentage rate and are thus to be said a niche
product (Geothermie, 2011b). This might be due to the fact that this technology was only
brought on the market in 2001 and building policies are still in construction in some cantons
(Geothermie, 2011c).
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Term Paper Energy Economics and Policy
Geothermal energy baskets are made of spiral wound polyethylene tubes that are fastened
with a metal skeleton (BFE, 2005a). There are two types available: conical and cylindrical
energy baskets with different dimensions (see table 3 and 4).
Feature EWK BETA - Basic EWK BETA - Eco EWK BETA - MAXI
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Term Paper Energy Economics and Policy
The chosen dimensions of the baskets are dependent on the available space and the
geological conditions of the soil. After having evaluated the size, the baskets are installed in
1-1.5m soil depth and are connected with each other. The depth is chosen to 1-1.5m
because the baskets need to be installed below the frost line to prevent the baskets from
freezing damage (BetaTherm, 2009b).
The tubes are filled with a liquid made of water and anti-freezing agents. This liquid is used
to absorb the warmth of the soil. The absorbed warmth of the liquid is then passed down to
a heat pump which is used as water heating system in the household. This assembly is
shown graphically in figure 3.
Figure 3: Assembly of the needed infrastructure in order to use geothermal energy baskets.
1: heat pump 2: geothermal energy baskets (Geothermie, 2011b)
The main advantage of geothermal energy baskets is that the soil warmth in 1-1.5m depth
is approximately constant; the annual soil temperature fluctuates are within the range of
7°C to 13°C (AWP, 2007). Hence, geothermal energy baskets are an ideal energy source
for heat pumps because heat pumps have a longer lifecycle if temperatures are similar over
the whole year (AWP, 2007).
2. Model of Investigation
In the following, the financial saving potential as well as the environmental impacts of
energy baskets is discussed. To do so, geothermal energy baskets are compared with a
conventional fuel oil heating system.
The focus of the comparison is set on a standard Swiss family home that is about to build.
This house is said to have a heatable area of 160m2. Moreover, the house is occupied with
4 people. The daily amount of needed warm water is estimated to 300 liters and the heat
demand (including warm water) is estimated to 8.33 kW.
To fulfil this demand, the parameters and costs for the fuel oil heating system and the
geothermal energy baskets are calculated and shown in table 5.
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One-Time Expenditure
Costs of Fuel Oil Burner and its installation 4500
Costs of Tank and its installation 13000
Total 17500
Yearly Costs
Cost of needed Oil (2500 Litres) 2250
Cost of Service 250
Tank Cleaning 500
Electrical Energy (404 kWh) 81
Total 3081
One-Time Expenditure
Costs of Baskets and Installation 16300
Costs of Heat Pump and Installation 25000
Total 41300
Yearly Costs
Electrical Energy to run the Heat Pump (2900 kWh) 580
Maintenance Costs 100
Total 680
Table 5: Parameters and costs regarding fuel oil heating and geothermal energy use (BFE, 2005b.
RiedoClima, 2008. Hoval, 2010).
Taking the costs from table 5, a reference oil price of 90 CHF per 100 litres, and a
reference electricity price of 0.20 CHF per kWh (Newsadmin, 2011), the payoff period of
geothermal energy baskets is calculated. According to the chosen parameters, it takes 10
years until the geothermal energy baskets pay off compared to the fuel oil heating system.
By comparing this payoff period with the average useful life of conventional fuel oil heating
systems it can be said that geothermal energy baskets payoff within the wanted timeframe.
However, as mentioned in the introduction section, the use of fuel oil heating systems is
highly dependent on the oil price. Therefore, three scenarios are investigated*:
Since the electricity price is coupled with the oil price, it is assumed that an increase of the
oil price of 10% increases the electricity price by 6%.
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Term Paper Energy Economics and Policy
Scenario 1
90000.0
80000.0
70000.0
Total Costs [CHF]
60000.0
total costs of fuel oil heating
50000.0 system [CHF]
40000.0 total costs of energy baskets
[CHF]
30000.0
20000.0 Payoff period = 9.12 years
10000.0
0.0
0 5 10 15 20
Time [years]
Scenario 2
100000.0
90000.0
80000.0
Total Costs [CHF]
70000.0
60000.0 total costs of fuel oil heating
system [CHF]
50000.0
total costs of energy baskets
40000.0 [CHF]
30000.0
20000.0 Payoff period = 8.52 years
10000.0
0.0
0 5 10 15 20
Time [years]
Scenario 3
110000.0
100000.0
90000.0
80000.0
Total Costs [CHF]
Figure 4: Payoff periods of the three different scenarios (detailed calculations in the appendix).
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Term Paper Energy Economics and Policy
As seen from figure 4, the one-time expenditures are higher when installing geothermal
energy baskets. However, the costs of operation are higher when installing a fuel oil heating
system. This is due to the fact that an increase in the oil price has a big impact on the costs
of operation.
Further, it is seen that geothermal energy baskets pay off before the average useful life of
the oil heating system is achieved. Therefore, costs could be saved by installing geothermal
energy baskets. This savings could already be achieved after 7 to 10 years (dependent on
the oil price).
Since the average useful life of oil heating systems and geothermal energy baskets is both
said to be 20 years, the difference in total costs at year 20 can be compared. This returns
the financial saving potential of geothermal energy baskets during their whole expected
useful life. The comparison is shown in table 6.
total costs of energy baskets total costs of fuel oil Savings Savings
[CHF] heating system [CHF] [CHF] [% of fuel oil heating system]
Table 6: Total costs of geothermal energy baskets and the fuel oil heating system. Calculated saving potential
of geothermal energy baskets during their whole expected useful life.
In the following, the CO2-emissions of a conventional fuel oil heating system and the use of
geothermal energy baskets are calculated. To do so, the amount of needed oil is converted
into kWh (IngBüro Rochel, 2011).
Table 7 shows the needed amounts of electricity for both systems. Moreover, the CO 2-
emission factors for fuel oil and the Swiss electricity mix are shown as well (Geowatt, 2004).
Table 7: Annual amount of needed electricity and CO2-emissions factors to calculate the corresponding
annual CO2 release of the fuel oil heating system and the geothermal energy baskets (Geowatt, 2004)
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Term Paper Energy Economics and Policy
Out of the parameters in table 7, the annual CO2- emissions of the two systems are
calculated and shown in table 8.
The largest amount of emitted CO2 is caused by burning fuel oil while the electricity takes
on only a small part of the total CO2-emissions. In addition, it has to be mentioned that the
Swiss electricity mix consists of 40% nuclear power and 60% hydraulic power (SF, 2011).
Hence, the CO2-emissions could even get lowered more by using eco electricity provided
by certain Swiss power providers.
In summary, the CO2 saving potential of geothermal energy baskets is immense: By using
geothermal energy baskets, 99.8% of the CO2-emissions of the fuel oil burning system can
be saved.
Furthermore, there are other environmental impacts to mention. Above all, using
geothermal energy baskets always means modifying the underground. As a result of the
heat abstraction from the underground, the soil might show changes in its fertility. This can
be assessed by diminished growth of plants, decreasing biodiversity and reduction of
aerobic bacteria activity (Energie Schweiz, 2006). In addition, the used anti-freezing agents
in the pipes could emanative due to deficient installation and percolate in deep soil depths.
As a result, the groundwater is contaminated and damage is caused to all living species in
the underground (Energie Schweiz, 2006).
As listed in table 3, the clearance between conical baskets is more than 5 meters. This
leads to a space requirement of 25m2 per basket. In general, more than 6 energy baskets
are required to fulfill the heat demand. Hence, geothermal energy baskets have a high
space requirement and can only get installed in large gardens and fields.
Finally, geothermal energy baskets are relatively unknown in Switzerland. Hence, not all
cantons have made policies about their installation yet. The few cantons that have already
set up standards do have strict regulations regarding the groundwater prevention. Thus,
geothermal energy baskets must not get installed in the groundwater prevention zones S1
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Term Paper Energy Economics and Policy
and S2 (Geothermie, 2011c). Moreover, geothermal energy baskets must not get installed
where the groundwater flow is not located at a soil depth deeper than 2 meters
(Geothermie, 2011c).
3. Conclusion
Regarding the building policies, geothermal energy baskets are not having standards in all
cantons yet. However, geothermal energy baskets might be a good alternative where
downhole heat exchangers are not permitted. Downhole heat exchangers are usually drilled
through groundwater flows and thus permitted in such cases. At this point, geothermal
energy baskets would be a good alternative because they lie in a soil depth of only a few
meters and usually don not intersect a groundwater flow.
Furthermore, the different cantons in Switzerland could think about subsidies for home
owners who want to install geothermal energy baskets. In this way, sustainability in regard
to the future and an independent energy supply is supported. Moreover, the payoff period of
geothermal energy baskets would get shortened what might lead to more people installing
this technology. Further, people might want to switch to environmental friendly heating
systems in the future because the climate change is increasing and they want to contribute
to a sustainable lifestyle. Therefore, building standards are needed. On the other hand, as
the usage of geothermal energy baskets increases in the future, the demand for electricity
is increasing as well. Thus, the Swiss government has to import electricity or produce it
domestically. Unfortunately, importing holds the risk of increasing the CO2-emissions
because the imported EU electricity mix has a higher CO 2 content than the Swiss electricity
mix. Hence, importing electricity is increasing the CO2-emissions again although the
emissions were thought to get reduced by using geothermal energy baskets.
In conclusion it can be said that in regard to the current political instabilities, the increasing
oil price, and the climate change, the Swiss cantons will be forced to compile building
standards for geothermal energy baskets in the future because this is a heating system that
has a potential of getting popular.
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Term Paper Energy Economics and Policy
A. Appendix
Table 9: Calculations of the yearly total costs of an oil heating system and the use of geothermal energy
baskets.
time [years] total costs of energy baskets [CHF] total costs of fuel oil heating system [CHF]
Scenario 1
0 41300.0 17500.0
1 42014.8 20810.6
2 42729.6 24121.3
3 43444.4 27431.9
4 44159.2 30742.6
5 44874.0 34053.2
6 45588.8 37363.9
7 46303.6 40674.5
8 47018.4 43985.2
9 47733.2 47295.8
10 48448.0 50606.5
11 49162.8 53917.1
12 49877.6 57227.8
13 50592.4 60538.4
14 51307.2 63849.1
15 52022.0 67159.7
16 52736.8 70470.4
17 53451.6 73781.0
18 54166.4 77091.7
19 54881.2 80402.3
20 55596.0 83713.0
Scenario 2
0 41300.0 17500.0
1 42049.6 21040.5
2 42799.2 24581.0
3 43548.8 28121.5
4 44298.4 31662.0
5 45048.0 35202.5
6 45797.6 38743.0
7 46547.2 42283.5
8 47296.8 45824.0
9 48046.4 49364.5
10 48796.0 52905.0
11 49545.6 56445.5
12 50295.2 59986.0
13 51044.8 63526.4
14 51794.4 67066.9
15 52544.0 70607.4
16 53293.6 74147.9
17 54043.2 77688.4
18 54792.8 81228.9
19 55542.4 84769.4
20 56292.0 88309.9
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Term Paper Energy Economics and Policy
Scenario 3
0 41300.0 17500.0
1 42154.0 21746.2
2 43008.0 25992.4
3 43862.0 30238.6
4 44716.0 34484.8
5 45570.0 38731.0
6 46424.0 42977.2
7 47278.0 47223.4
8 48132.0 51469.6
9 48986.0 55715.8
10 49840.0 59962.0
11 50694.0 64208.2
12 51548.0 68454.4
13 52402.0 72700.6
14 53256.0 76946.8
15 54110.0 81193.0
16 54964.0 85439.2
17 55818.0 89685.4
18 56672.0 93931.6
19 57526.0 98177.8
20 58380.0 102424.0
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Term Paper Energy Economics and Policy
References
(Geowatt, 2010) Geowatt AG. Statistik der geothermischen Nutzung in der Schweiz –
Ausgabe 2009. pp. 25-32, 2010.
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(Hoval, 2010) Hoval Herzog AG, Technische Daten und Preise Available from:
http://bau-katalog.ch/technische_daten_und_preise_1.4.2010/2_oel__gasheizkessel__
abgaswaermetauscher.html Retrieved 19.04.2011.
(Stiebel, 2011) Stiebel Eltron Technik zum Wohlfühlen. Available from: http://www.stiebel-
eltron.ch/erneuerbare-energien/informieren-planen/wissen/fragen-antworten/wp-
lebensdauer/ Retreived 19.04.2011.
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