Key Points
- Geothermal heat pumps differ from air-source alternatives by using the stored ground heat for climate control instead of the ambient air temperature.
- Subterranean temperatures don’t fluctuate like weather conditions. Ground-source heat pumps take advantage of the consistency to maintain higher efficiency.
- Coolant fluid in the underground loops absorbs the natural temperature of the earth to heat and cool the air in the indoor unit, then disperses that air throughout the home.
Do you know how geothermal heat pumps work? What about the difference between ground-source (geothermal) and air-source heat pumps? Heat pumps as a whole are a fantastic, energy-efficient method of heating and cooling your home, but geothermal heat pumps are leagues above the rest. Geothermal heat pumps are highly efficient, environmentally friendly HVAC systems, but many homeowners are intimidated by the upfront costs. Geothermal is certainly an investment, but it will pay for itself over time. On average, homeowners who install a geothermal heat pump will save enough on their utility bills to have the system and installation costs paid off within 10 years, but some have managed it in as few as 3! But why are geothermal heat pumps so efficient? In this IWAE guide, we’ll answer this question and explain the mechanisms that make geothermal energy available to our homes.
The Key to Geothermal: Underground Temperatures
Traditional HVAC relies on a combination of refrigerant and fuel sources that either remove heat from the air or heat cooled air. For example, a traditional air conditioner traps heat in a coolant fluid, then expels the heat into the outside air. This is how heat is removed from a building in summer. In winter, a homeowner might rely on a liquid propane furnace, which uses an internal ignitor to heat and disperse warmed air throughout the home.
Heat pumps function similarly, but without the need for fossil fuels to power the process. Heat pumps cool in the summer and heat in the winter by converting ambient ground temperatures into comfortable indoor temperatures. By reversing the cycle, heat pumps can remove warm air from the home in summer and then cool it for recirculation, or warm and disperse hot air in the winter.
A geothermal heat pump functions the same way. The difference between a geothermal heat pump and an air-source heat pump is that a geothermal heat pump uses the stored ground heat during its heating and cooling cycle, not ambient air.


What Difference Does Ground Temperature Make?
The ambient temperature a few feet beneath the Earth's surface rarely fluctuates, even during variable weather conditions. In many parts of the world, the summer and winter subterranean temperatures only differ by a few degrees. This consistency in temperature means that your ground-source heat pump doesn’t have to work as hard to raise or lower that temperature, depending on the needs of your home.
Compare this to air-source heat pumps. While more efficient than other HVAC systems, air-source heat pumps may struggle to maintain efficiency standards in regions with extreme temperature fluctuations, leading to increased electricity consumption and higher utility costs for the homeowner. For example, the outdoor air temperature in a region may drop to the mid 30s, but the ground temperature may remain closer to 50 degrees Fahrenheit. In this case, the heat pump would work harder to convert the temperature from the air into a comfortable indoor temperature than it would to convert the ground temperature.
The main way an air-source heat pump loses efficiency during its heat cycle is due to a dropping air temperature outside. A geothermal heat pump doesn't worry about that, since it has access to a stable heat source year-round. This is what allows a geothermal heat pump to hit heating efficiencies that an air-source heat pump can't match.
Step-by-Step: How Geothermal Heat Pumps Work
The cycles a heat pump goes through for heating and cooling are slightly different, but they share the same principle: using the ground temperature to change the temperature of the coolant fluid circulating through the heat pump’s loop system.
In order to provide heating, a geothermal heat pump will:
- Circulate fluid through the ground loops, absorbing the natural heat of the earth in the process
- Bring the heated fluid into the heat pump’s heat exchanger, which warms air processed by the indoor unit
- Circulate heated air through indoor ductwork, thereby heating the home
In order to provide cooling, a geothermal heat pump will:
- Extract warm indoor air using the heat exchanger, which then warms the fluid circulating through the system
- Pump the heated fluid through the loops, transferring that heat into the cooler underground environment
- Send chilled fluid back to the indoor unit to absorb more heat from the heat exchanger, and repeat
Shop Geothermal Now
Like what you’ve heard about ground-source heat pumps? Have a look at IWAE’s best geothermal heat pumps, and start planning your installation today.
Geothermal Units
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Get Ready for Geothermal
Geothermal heating is the moment. Advocates praise its high efficiency standards and future-proof design. These systems are perfect for anyone looking to decrease their yearly utility bills or move off-grid. While the installation costs and land requirements present significant barriers to many potential geothermal owners, installing one of these systems is not impossible. IWAE simplifies the process with our geothermal installation kits, and our in-house experts can guide you through our geothermal installation checklist. We’re here to help you every step of the way. If you have more

