Open Forum

Concerned about the market

  • 1.  Concerned about the market

    Posted 09-19-2017 14:28
    ​​I am really concerned about the residential geo thermal market conditions and Is it possible to open a forum of what we can do as a team of one to move the needle in the right direction for the end users asking for Geo Thermal ..  It is possible to create awareness by running end user campaign  in locations where the money spend will get the most return..?   Yes we need the government to help us but I feel at this point we must and I say We as a total organization drive the bus to getting Geo thermal the normal installation when heating and cooling not the in normal installation.

    Could we make a builder program?
    Could we make a Installer program where the more the installer does and the more they attend trainings the more rewards they get?

    I open and looking for all and any feedback...

    I say we drive the bus not ride the bus in growing this market...I was at a customer event last week Water Furnace and they promoted Reliable Renewable...This is a great message

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    Barry Nauss

    Grundfos Pumps Corp.
    Cary NC
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  • 2.  RE: Concerned about the market

    Posted 09-20-2017 08:10
    I understand your concern, it is affecting us all. However we do not need government assistance. They are the ones that started the problem in the first place.   Handing out free fish instead of teaching people how to fish.  The only way contractors know how to sell geothermal units now is by pushing tax credits.  We sold plenty of units prior to the tax credits being a place.  With the tax credits being in place for the last eight years no one knows how to sell units without it anymore    The sales people need to be taught to sell the geothermal units on their own merits and then the sales will be back

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    Kris Kyler

    Indiana Geothermal, Inc.
    Indianapolis IN
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  • 3.  RE: Concerned about the market

    Posted 09-20-2017 12:36
    ​Kris - You are 110% correct.  The industry, from manufacturing to contractors to our trade organizations have not only swallowed the incentive "Kool-Aid", they drained the punch bowl!  We have associated ourselves with the Nature Nazi renewable crowd - ie, solar, wind, etc., that cannot subsist without using other people's money to make it viable.  This perception is what most residential owners have, that a geo system is un-obtainable without someone giving them a freebie to offset 1st cost.  And when we rely on politicians to write our business plan, we will and are screwed.  At the very least if incentives are offered there should be a requirement for performance validation to eliminate the shade-tree bottom feeders that kill our industry's reputation.

    Geoexchange can stand on its own, and that is how it must be presented. We have to face some realities - some markets are going to be tougher - I live in Colorado and residential geo work is in the tank. We have a growth boom and everyone from low-end tract home developments to custom home builders bottom feed the mechanical system; NG is also cheap, so our propane markets are somewhat of an opportunity.  The developers and GC's sell their homes as 'green' by promoting setback t-stats, a bit better insulation and a 90% furnace; AC is typically an adder.  Occasionally we get an informed home buyer demanding a geo system, but it's rare.  And general contractors are often the problem, intentionally killing a geo option if they can - but they upsell the trim and landscaping out the wazoo. Our market is more justified for large trophy homes, which are really light commercial 10k to 30k+ sq. ft. McMansions, schools, municipal, military and commercial projects.  Economy of scale is our friend.  And economy of scale could work with tract home developments committing to enough geo installations at one time, but we battle the bottom feeder mindset - and these miscreants markup a cheap furnace and sloppy duct system as if it were a geo installation with a ground loop.

    Education is the key, from consumer to contractor and on up the industry food chain.  Snake oil in the form rule of thumb of ground loop strategies and configurations that promise to lower installation cost that end up failing need to go.  And look at the cost of a simple single stage compressor heat pump - the manufacturers have to make a profit but seems like they tend to overcharge too, it's not just the cost of the ground loop.

    Above all when a residential system goes in it has to work as intended.  No one hears about a good geo installation, but they sure hear about a bad one - and it typically grows in 'train wreck' perception as the bad word of mouth progresses.  I think building a hard reputation of successful installations to reference in local regions, that are simple and uncomplicated, not oversold, easy to maintain, and reliable, is to the benefit of industry to grow. Unfortunately I do quite a bit of forensic geo work. It pays but would rather be backlogged with new design work.

    ------------------------------
    [Terry] [Proffer] [Geothermal Manager, CGD]
    [Major Geothermal]
    [Wheat Ridge] [CO]
    [80033]
    TerrilTerril
    ------------------------------



  • 4.  RE: Concerned about the market

    Posted 09-20-2017 10:48

    A response to the Open Forum comment by Barry Nauss:

     

    We are loop installers, and share your concern.

     

    We see in the Midwest the trend for "everything solar".  That tax credit got extended, and certainly it makes a difference to the "end user – customer".

     

    What seems to be lost in the solar selling spree is the "reduce before you produce" mentality.  For whatever reason, what gets sold seems to be "whatever it takes to produce what the home averaged in the past two years".  It doesn't seem to matter that the home used baseboard electric heat in the winter with all the windows open.......  So long as the tax credit covers 30%, and in Iowa the additional 12% in 2017, put the maximum kV on the system and go with it.

     

    We are all for the concept of life cycle costing and the low cost operation of geothermal systems.  It would appear that we would be best served to "hold hands" with the solar group to pair these two technologies together for customers to install the most efficient system for heating and cooling (geothermal) and feed it with an appropriately sized electrical generation source (solar/wind) for a structure that is well built/insulated/sealed.

     

    Look forward to feedback on this one.

     

    Larry

     

    Larry Leliefeld
    President, G.E.O. Inc.
    larry@geo-inc.com                                      www.geo-inc.com

    Decorah information (use for mailing address):                   
    Geothermal Eco Options, Inc.                 Mobile: (563) 203-0184
    P.O. Box 401                                                   Phone:  (563) 382-0300
    Decorah, IA  52101                                       Fax:        (563) 382-0305

    Cresco information (use for shipping address):    
    Geothermal Eco Options, Inc.                 Mobile: (563) 203-0184
    407 2nd Avenue S.W.                                 Phone:  (563) 547-2871
    Cresco, IA  52136                                          Fax:        (563) 547-2874

     


    Virus-free. www.avast.com





  • 5.  RE: Concerned about the market

    Posted 09-21-2017 08:25

    Mr. Leliefeld said something that I believe is a great idea; combining geo & solar/wind technologies.  At the community college at which I teach (Kankakee Community College, Kankakee, IL), I've spoken about geo and solar used to not only provide the H/AC needs of a home, but with the Renewable Energy program we have here using this to help offset the cost of the electricity to power the GSHP.  Our students can get basic education in both geo and solar/wind.  It is a community college, so they aren't experts or engineers.  They are taught the basics of design, application and troubleshooting.

     

    Our Renewable Energy program is very active, due to the energy credits and government promotional material, in the local community.  But most of the local contractors for HVAC are so tied to tax credits, I believe they are overlooking the entirety of the total home package.  And the solar/wind folks don't look over much other than the electrical needs, excluding the heating and air conditioning portion regarding how much electricity a system uses and it can offset.

     

    Thanks for mentioning this! 






  • 6.  RE: Concerned about the market

    Posted 09-20-2017 12:11
    ​Really spot on responses... I agree total with all that has been said... I would like to open up this idea at a Grundfos location a white board discussion of what we can do, and what we should do, to Getting back growth with Geo Thermal..
    I am sure in our industry we have  very very smart people and I am sure we can come up with maybe 3 top action items that at least we can run test cases in areas to see what works best...I am guessing that we will not have one idea that works for best for different locations.
    But that is ok... Walt Disney failed many times before creating a mouse...

    Again I open up this invitation to anyone.., I think we need manfacturers Installers, maybe end users, Wholesalers,  The more input the better
    I will provide the location ,the food, ,at no cost to anyone that would like to attend..  Yes I am ok with other pump companies attending.. Again  I looking to support the industry not just to Grow Grundfos.

    I can ask One of my counterparts from Europe to attend and give their suggestions..

    TEAM
    Together
    Everyone
    Accomplish
    More.


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    Barry Nauss

    Grundfos Pumps Corp.
    Cary NC
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  • 7.  RE: Concerned about the market

    Posted 09-21-2017 08:18
    Barry, I do like your idea of gathering the team. I would offer IGSHPA's training room in Stillwater, OK for such a meeting if you feel it meets with what you are planning.
    Also, please review the white paper our advocacy committee has written at IGSHPA White Paper
    Thanks,
    Garen Ewbank, President, IGSHPA BoD

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    Garen Ewbank

    Ewbank Geo Testing, LLC
    Fairview OK
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  • 8.  RE: Concerned about the market

    Posted 09-23-2017 11:04

    I appreciate and understand Barry's concern. It's great to see the replies so far, and I agree with the feedback. I've been in the industry over 30 years, and have experienced our industry growing way before the tax credit. In my opinion, we need to change the dialog and change the perception. I've heard conversations even in 2015 about looking for other technologies to sell after the tax credit expires, which is really unfortunate. So, we've definitely not been focusing on the benefits, but on the tax credit. I've also heard about how cheap natural gas is, which is true, but it's been cheap for years. I remember in 1990s when we had difficulty selling against natural gas based only on operating costs. So, nothing has really changed other than we don't think we can sell geothermal any longer for some reason.

     

    If it were only about operating costs and/or tax credits, it would be a different story. I didn't put geothermal in my house because it was less expense to operate than natural gas. I don't want to hear the condenser when I'm out on the deck. I like a cleaner, safer, all electric home without wall or roof penetrations for flue pipes, and I'd rather not have combustion inside. I also like the better comfort, longer life of the equipment, and the fact that 95% of the system is American made. The technology has a great story to tell, as it did before the tax credit.


    I hope that Grundfos and other hydronic centric companies can reach out to GEO, IGSHPA, manufacturers, distributors, contractors, drillers, etc. to come up with a "why geo?" campaign. None of us have a lot of marketing funds right now, but if we can all be telling the same story, we can get the word out. For example, a couple of single page (front and back) flyers, one for end users and one for contractors, would be a great way for all of us to provide a consistent message. Not only is it a great technology for end users, it's a good business decision for contractors to install geo. I'm sure that GEO and IGSHPA could come up with these marketing pieces. However, we need companies like Grundfos to provide funding for printing costs so that the pieces could be available to industry stake holders at no cost. Social media campaigns, collaborative marketing strategies, etc. can also help. I'm not concerned about promoting a non-branded campaign. We'll all get our piece of the pie. We just need a BIGGER pie right now. I'm happy to participate in any way I can.



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    Jeff Hammond
    Geo-Flo Products Corp.
    jhammond@geo-flo.com
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  • 9.  RE: Concerned about the market

    Posted 09-25-2017 09:06
    Jeff,
    I agree with you.  Interestingly, so does the New York State Energy Research and Development Agency (NYSERDA).  I understand that they want to figure out how to do an industry, but not manufacturer, add campaign to bring out all the benefits of geo to the homeowners in NY.  They should get matching funds from industry partners, such as Grundfoss and your company, IGSHPA and GEO, and the owner of the vast majority of manufacturing capacity in the US (and the world as I understand it)
    NY is a great test area because we have a strong and growing contractor base, a trade association, NY-GEO, and a State Agency that is providing incentives and has a mandate to increase the replacement of oil and propane with electric operated systems.  We  can lead the way in demonstrating how transform the present into the future, if we all get together and promote the industry.
    The biggest need is to convince homeowners that the capital investment is better than any other they could make.  Without it the air source industry, which has already geared up to promote their products in NY, will eclipse the geothermal HVAC message.  I think the fact that most of the geothermal product sold is manufactured in the US, while air source is primarily manufactured in the Asian rim countries, can be the big win promotion was.

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    Lloyd Hamilton

    Verdae, LLC
    Rhinebeck NY
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  • 10.  RE: Concerned about the market

    Posted 09-26-2017 10:21
    Barry, Jeff and everyone else, some great comments thus far.  I agree largely with what's been said and would love to ensure GEO's involvement in any such industry-wide promotional effort.

    I should note that GEO has some materials that might be useful right now to contractors and other customer-facing businesses, and anyone should feel free to utilize them.  A few links below and we've got lots of additional stuff to build from as I'm sure IGSHPA does (including the excellent white paper Garen mentioned).

    Please let me know how I can help put together any strategy session.  Looking forward to working with you all on this.  Thanks, Ryan.

    Two-page color consumer flyer: https://www.geoexchange.org/wp-content/uploads/GHPs-Tapping-Energy-Beneath-Our-Feet.pdf

    GHP benefits doc: https://www.geoexchange.org/wp-content/uploads/GHPs-Renewable-Energy-for-a-Better-Environment-and-Economy.pdf

    Geothermal Spectrum color one-pager: https://www.geoexchange.org/wp-content/uploads/The-Geothermal-Spectrum.pdf

    ASHRAE GHP vs VRF flyer: https://www.geoexchange.org/wp-content/uploads/GEO-VRF-Study-Brochure-2-pg.pdf

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    Ryan Dougherty

    GEO - Geothermal Exchange Organization

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  • 11.  RE: Concerned about the market

    Posted 09-28-2017 11:18
    Jeff:

    I agree with that the many benefits of GSHPs should be emphasized at current market situation. In addition to what you mentioned, I think climate resilience is another benefit of GSHPs. After this hurricane season, many communities need to be rebuild. Shouldn't GSHPs be integrated into the rebuild?

    While GSHP market is low at US, it is high on the other side of the ocean. China plans to condition 1.6 billion m(17 billion ft2) buildings with GSHPs by 2020. The biggest driver of this ambitious goal is the urgent need to reduce air pollution. Coal -fired boilers for heating are prohibited gradually, and heat pumps (ASHP and GSHP) are becoming an alternative.  While natural gas is cleaner than coal, combustion of natural gas still produces carbon emissions. Given the high exergy of natural gas, it would be wiser to use it to generate electricity instead of warming the built environment to just around 70F! A consensus from a recent International Energy Agency conference is that heat pump should be the future main stream technology for space heating and water heating.

    With regard to the joint effort for marketing, I suggest collaboration with the Renewable Thermal Alliance (RTA), which is a private – public partnership established to develop the infrastructure for large-scale deployment of Renewable Thermal Technologies, including GSHPs. More information of RTA is available at: Renewable Thermal Alliance. In the RTA meeting yesterday, there was a lively discussion on the strategies and needed collaborations for marketing renewable thermal technologies, particularly GSHPs. Attached is a presentation given by Josh Kessler of Massachusetts Clean Energy Center for marketing renewable thermal technologies to commercial-scale customers.

    Thanks,

    Xiaobing

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    Xiaobing Liu

    Oak Ridge National Lab
    Knoxville TN
    865-574-2593
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  • 12.  RE: Concerned about the market

    Posted 09-28-2017 11:19
      |   view attached
    Attached is the presentation mentioned in my earlier post.

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    Xiaobing Liu

    Oak Ridge National Lab
    Knoxville TN
    865-574-2593
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  • 13.  RE: Concerned about the market

    This message was posted by a user wishing to remain anonymous
    Posted 07-25-2018 06:50
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