Heating and cooling accounts for 40 per cent to 50 per cent of power consumption in non-residential buildings. This highlights the urgent need to increase the overall energy efficiency in these buildings – geothermal heating and cooling technologies may hold the key.
New analysis from Frost & Sullivan's Analysis of the North American Geothermal Heating and Cooling Market research, finds the market earned revenue of $102.8 million in 2012 and estimates this to reach $147.6 million in 2017.
"Geothermal heating and cooling is an excellent way to conserve energy while employing the earth as the chief energy transfer base," said Frost & Sullivan Energy and Environment Industry Manager Konkana Khaund. "Despite its huge initial costs, its higher energy efficiency and long-term cost savings are capturing the attention of environmentally conscious end users."
The geothermal heating and cooling market in North America will get a boost from legislation in areas such as the Energy Policy Act of 2005, and the Energy Independence and Security Act of 2007, which mandate at least a 30 percent increase in energy efficiency over existing levels. However, the market is reined back by the high capital required to install the technology.
"Non-residential users are in a better position to invest the capital and gain strong returns on investments in just a couple of years," noted Senior Industry Analyst Anu Cherian. "However, most end users are inclined towards ‘short termism' and do not perceive the long-term benefits of investing in this technology."
Apart from tight spending from end users, the highly competitive geothermal heating and cooling market is also challenged by price wars. To differentiate, manufacturers need to educate their potential end users about the lifecycle cost savings that can be accrued by investing in geothermal technologies. Installing such environment friendly products will also make building owners eligible for tax rebates and incentives.
Overall, geothermal heating and cooling technology's standout benefits are expected to attract customers from across segments. Some of these benefits include long lifecycles, reliability, decrease in energy cost, the ability to comply with energy efficiency requirements and the positive impact on the environment.
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