Pasco geothermal firm sees business boom

Business is booming for one area firm. The reason people may not have heard about it - it's happening underground.

Jay Egg of Egg Geothermal Air Conditioning and Pool Heating said he booked six residential jobs and several commercial appointments just last week. Overall, his business has jumped 20 fold.

"It's revitalized everybody's attitude," Egg said of his 40 employees. "They are buzzing around here constantly."

Egg attributes the jump to the American Recovery and Reinvestment Act, which took effect in March 2009. The federal stimulus package gives residential purchasers of a qualified geothermal system a 30 percent tax credit on the cost.

Benefits are even better for commercial purchasers. Among the incentives are a 10 percent credit or grant toward the purchase. The purchaser can depreciate 50 percent of the cost in the first year and the whole amount in five years.

The incentives apply until Dec. 31, 2016.

Moreover, Eggs said, residential customers will see a 50 to 80 percent reduction in their energy bills.

Even better, geothermal systems last longer. Systems he installed 20 years ago are still operating, Egg said.

"Geothermal really is 'it' now," Egg said. "Of course, I thought it was 'it' 20 years ago."

Egg started as a geothermal specialist in the 1980s. At the time, these efficient systems were under the radar, something only Northerners used to cut heating costs and not a hot item in Florida at all.

With business so slow, Egg added standard air conditioning systems to his product line to stay in business. During the housing boom, he was installing 1,000 standard units a year. That plunged to about three jobs a month, however, when the bottom dropped out of the housing market, he said.

The phone started ringing again last year, after Congress passed the stimulus package. Egg spent a bunch of money on marketing, including hiring another Port Richey business, Argonaut Studios. Argonaut whipped up Egg's Web site and optimized his search engine status. Now he's getting six to 12 qualified leads a week via the Internet.

That boost in business includes a Marriott and three other hotels in Orlando.

"Some hotels are paying $600,000 a year in electricity and gas. They can save a minimum of $250,000 on those costs plus get the benefits of the incentives," Egg explained.

Egg said his residential systems cost about $21,000 for a 2,500-square-foot home. That compares to from $9,000 to $10,000 for a standard high-efficiency, 16 SEER or above, unit for the same-size residence.

The cost for a geothermal heat pump system that can be attached to an existing water well is a little less. For new construction, because all the ductwork must be installed, the cost is a little more.

Along with the tax credit, purchasers will see a faster return on their investment as electric and gas prices go up, Egg said. Without the credit, the average geothermal system pays for itself in savings in 10 years, the green-energy Web site GreenAndSave.com estimates.

"There's nothing not to like. It's the longest lasting, most efficient system, bar none," Egg explained. He also likes it because it is sustainable and earth-friendly.

Egg's Web site explains how the geothermal heat pump works:

Outdoor temperatures fluctuate with the changing seasons, but underground temperatures don't. At a mere 4 to 6 feet below the earth's surface, temperatures remain relatively constant year-round.

A geothermal system, which typically consists of an indoor unit and a buried earth loop, capitalizes on these constant temperatures to provide "free" energy. In winter, fluid circulating through the system's underground earth loop absorbs stored heat and carries it indoors.

The indoor unit compresses the heat to a higher temperature and distributes it throughout the building. In summer, the system reverses, pulling heat from the building, carrying it through the earth loop and depositing it in the cooler earth.

Unlike ordinary systems, geothermal systems do not burn fossil fuel to generate heat; they simply use the ground as a heat source or heat sink, providing a more efficient, affordable and environmentally friendly method of heating and cooling. Typically, electricity is used only to operate the unit's fan, compressor and pump.

The U.S. Department of Energy sources list Florida as the No. 1 state both in potential and actual savings for these geothermal heat pump systems. The only disadvantage the agency lists is the initial cost, but that didn't include the 30 percent tax credit.

Moreover, Egg said, if the country's energy-saving policies continue, geothermal systems may be required in future building codes after 2016.