A recent Axios analysis found that the U.S. housing market is short 3.2 million housing units, noting “there aren’t enough homes to keep up with the increase in households.” To be sure, both of these challenges defy simple solutions. However, the industry can create large-scale, climate-resilient housing when buyers, builders, developers and policymakers address these challenges. Specifically, integrating geothermal heating and cooling from day one will minimize environmental impact, heighten sustainability and help ensure long-term affordability.
Wyatt Roberts, head of new construction for Dandelion Energy, sat down with Construction Executive to discuss details on how the Energy Star building certification promotes the biggest bang for your buck when it comes to building more and building more sustainably.
How is Energy Star different from LEED or other energy-related building certifications?
Energy Star focuses strictly on energy efficiency, certifying buildings based on actual energy performance data to ensure they meet high-efficiency standards. In contrast, LEED takes a broader sustainability approach, evaluating energy use, water efficiency, materials, indoor air quality and environmental impact through a point-based system.
Energy Star is the best choice for builders looking to maximize efficiency and lower operating costs. For those pursuing a comprehensive sustainability certification, LEED is preferred.
(Tip: Learn more on Energy Star vs. LEED: Energy Star Certification Guide | LEED Certification)
What does it take to qualify for Energy Star certification?
To qualify, a building must meet the Environmental Protection Agency’s Energy Star efficiency criteria, typically performing in the top 25% of similar buildings nationwide. Certification under the latest Version 3.2 (Rev. 14), revised Jan. 15, 2025, requires:
- Benchmarking energy use through EPA’s Portfolio Manager
- Enhanced thermal envelope requirements to meet or exceed the 2021 International Energy Conservation Code
- Stricter HERS Index Score targets lower energy consumption
- High-efficiency HVAC, insulation, lighting and water heating systems
- Third-party verification by a licensed Energy Star rated party
What should multifamily construction contractors know before aiming for certification?
Contractors should understand that Energy Star-certified multifamily buildings must comply with the Multifamily New Construction program. Key considerations include:
- Upgraded HVAC Requirements: Energy Star 3.2 favors high-efficiency systems like geothermal heat pumps for optimal energy performance.
- Strict Thermal Envelope Performance: Advanced insulation, air sealing and high-performance windows are essential.
- Energy-Efficient Lighting and Appliances: LED lighting, smart thermostats and Energy Star-rated appliances are key to compliance.
- Third-Party Verification: Builders must work with certified Energy Star raters to document compliance.
(Tip: Learn more about Multifamily certification: Energy Star Multifamily Guide)
Do qualifications vary by project specs, state or funding type?
Yes, Energy Star certification requirements can vary based on:
- Project Type: Single-family vs. multifamily certification criteria differ, with MFNC requirements applying to larger residential projects.
- State Energy Codes: Some states have stricter energy efficiency mandates that align or exceed Energy Star 3.2 standards.
- Public vs. Private Funding: Publicly funded projects often come with additional energy efficiency incentives or mandates for Energy Star compliance.
(Tip: Learn more state-specific policies:DOE Building Energy Codes Program.)
How many contractors are aware of Energy Star certification?
Awareness is reasonably high among major developers and energy-conscious builders, particularly in states offering strong efficiency incentives. However, many smaller contractors and developers remain unfamiliar with the process and benefits, presenting an opportunity for further education—especially on how geothermal HVAC can simplify certification.
(Tip: Learn how to become an Energy Star Partner: Energy Star Partner Resources
How does geothermal HVAC help builders achieve Energy Star certification?
Geothermal HVAC systems significantly improve energy efficiency by using stable underground temperatures to reduce heating and cooling loads. This helps builders meet Energy Star 3.2 standards in the following ways:
- Lower HERS Index Scores: Geothermal HVAC cuts energy consumption, helping buildings stay within the required efficiency range.
- Reduced Energy Costs: Energy Star prioritizes long-term operating cost savings, which geothermal systems provide.
- Integration With Other Efficiency Measures: Geothermal pairs well with high-performance insulation, air sealing and energy recovery ventilation to optimize overall building efficiency.
What incentives drive builder interest in geothermal energy?
Several factors are driving increased builder interest in geothermal energy.
Many states and regions offer programs, such as tax credits, rebates or grants, to further encourage geothermal adoption by reducing the upfront costs to builders at the time of construction.
These local incentives, potential utility rebates and falling upfront costs create a feasible and more affordable path for builders and their customers to adopt geothermal heating and cooling.
Additionally, generous federal tax credits, including the Residential Clean Energy Tax Credit, part of the Inflation Reduction Act, offer homebuyers:
- 30% for systems placed in service after Dec. 31, 2021, and before Jan. 1, 2033
- 26% for systems placed in service after Dec. 31, 2032, and before Jan. 1, 2034
- 22% for systems placed in service after Dec. 31, 2033, and before Jan. 1, 2035
What are the logistics of geothermal heating/cooling a multifamily building, whether constructing a new one or retrofitting an existing one?
Geothermal heating and cooling for a multifamily building can be a seamless and efficient process when planned early and integrated into the overall construction schedule. The first step is site qualification to determine the optimal layout for the heat exchanger (the “ground loop”), considering soil conditions, thermal conductivity, water table depth and other in-ground infrastructure the loop must not impact.
Once feasibility is confirmed, the system is designed and engineered as part of the mechanical, electrical and plumbing plans, ensuring smooth integration with other building systems.
Drilling and loop installation should be coordinated early in the project, allowing drilling and horizontal piping tie-ins to be completed with minimal disruption to other site activity. The installation process includes drilling vertical boreholes, installing piping and connecting the loop field to the building’s manifold system.
Planning for drilling spoils and water management ensures a clean and organized site, keeping construction moving efficiently. A central utility space may be designated for the manifold and flow center, distributing the geothermal energy to individual heat pumps.
Inside the building, piping runs are routed through chases, ceilings or mechanical rooms to connect each dwelling unit’s heat pump to the central manifold. Plumbing and electrical requirements, including fluid piping, pumps and electrical connections to each heat pump, are incorporated as part of the MEP scope.
The distribution system follows standard HVAC design and installation practices, whether ductwork for forced air or hydronic piping for radiant heating/cooling.
The ground loop is the key component, providing a renewable heat exchange source, while the interior mechanical systems are familiar to most HVAC contractors and align with conventional heating and cooling installations. With early coordination and thoughtful planning, geothermal heating and cooling enhances building performance, lowers operational costs and delivers long-term energy efficiency with minimal maintenance.
Can geothermal units easily be swapped out with older traditional units?
Existing builders or single-family homes can be retrofitted to accommodate geothermal heating and cooling systems. However, it is more complicated to do in a retrofit than ground-up new construction.
This can be an involved process because geothermal systems require underground pipes to exchange heat with the earth. Installing this loop involves digging or drilling, which can be disruptive and requires specialized equipment.
Moreover, geothermal units can often use existing ductwork, but some modifications might be necessary to optimize airflow for the new system.
The geothermal units are generally comparable in size to traditional units, but the ground loop system requires additional underground space.
How popular is geothermal heating and cooling amongst contractors today?
Geothermal heating and cooling systems are gaining popularity among contractors as awareness of the technology proliferates and financial incentives drive down the upfront costs of installation.
The Department of Energy notes that geothermal heating and cooling units could be installed in seven million homes by 2035, tripling the current U.S. installation base.
Contractors are recognizing the long-term benefits of geothermal heating and cooling as they leverage it as an opportunity to deliver the highest efficiency premium HVAC solution to their customers while building new homes that are less expensive to own. Builders are able to attract a broader base of customers looking to benefit from the value of renewable energy resources installed from the ground up and to establish themselves as leaders in sustainable building practices.
What is the likelihood of contractors building with geothermal energy going forward, considering the exacerbated demand for housing?
With the rising demand for housing and the growing emphasis on energy efficiency and sustainability, geothermal heating and cooling systems are becoming a more attractive option.
New construction is an especially opportune time to install geothermal systems because it eliminates many challenges and added costs associated with retrofitting existing homes while minimizing the building’s environmental footprint and equipping it with the most durable, cost-effective home heating and cooling solution from day one.
There is an urgent need to build more new homes. A growing percentage of these buildings will include geothermal heating and cooling solutions.
What is the permitting process for geothermal building?
Installing a geothermal system typically requires a simple state level drilling permit which is easily attained by a licensed driller. Beyond that, normal municipal construction permits need to be in place as with any other project. Typically these can take a month or more, depending on the locality.
Once permitting is secured, the installation proceeds in three phases.
First, the ground loop, the system’s heat exchange component, is installed. Then, the ground loops are connected to the home’s infrastructure. Finally, the heat pump itself is installed, completing the geothermal system.
What technology is required to set up and operate geothermal heating/cooling units?
Setting up and operating geothermal heating and cooling units involves several key technologies:
- Ground Loop System: This is the heart of the geothermal system, consisting of pipes buried underground to exchange heat with the earth.
- Heat Pump: The indoor unit, which contains the compressor, heat exchanger and controls, transfers heat between the ground and the home.
- Distribution System: This system distributes the heated or cooled air throughout the home’s ductwork.
Has geothermal heating/cooling proven more attractive for building buyers?
Geothermal heating and cooling is becoming increasingly attractive to home and building buyers, driven by its compelling combination of durability, performance, efficiency and long-term cost savings.
Compared to traditional HVAC systems, geothermal systems offer superior temperature control, consistent comfort and reduced maintenance costs.
Growing awareness, available financial incentives and consumer demand make it more attractive for home and building buyers.
Will geothermal ever become mainstream or even mandatory?
Geothermal heating and cooling is already becoming a mainstream home heating and cooling solution for homeowners. Nearly 80% of Americans are stressed out about their energy bills, and consumers are looking for more affordable, sustainable solutions that will last.
Since heating and cooling are often people’s most expensive monthly bills, federal, state and local incentives make installing a geothermal system more affordable (or working with a contractor who will perform this work).
I expect geothermal heating and cooling to become more popular every year. However, I don’t think it will become mandatory. To be sure, some states and cities are mandating that new construction can’t include new natural gas lines, which will push builders and contractors to adopt electric-powered solutions, the most efficient of which is geothermal heating and cooling.
SEE ALSO: SIMPLE STEPS TO ADVANCE YOUR LEED CERTIFICATION ASPIRATIONS
