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What is a Ground-Source, aka “Geothermal,” Heat Pump?

A Ground-Source Heat Pump (GHP) is part of an energy efficient Heating, Ventilation and Air Conditioning (HVAC) system, providing both space heating and cooling, and hot water production.

A GHP system uses a ground heat exchanger (usually comprising underground pipes or water wells) to transfer heat between a building and the earth. The GHP system displaces conventional fossil-fuel based heating and operates with electricity from New Jersey’s cleaner grid, thus reducing net carbon emissions.
GHP systems have been in use for over 70 years, with mounting research validating their long-term cost savings and environmental benefits. The NJ Board of Public Utilities Clean Energy Program offers a variety of incentives towards GHP systems in residential to industrial buildings. Many schools, health care facilities, and residential customers have taken advantage of the State’s incentive programs to install GHP systems instead of conventional HVAC systems.
GHP systems can be effective anywhere subsurface temperatures are stable and moderately warm – about 52-57 °F for NJ.  It is different from Direct Source Geothermal or Enhanced Geothermal Systems, which utilize hydrothermal waters for electricity generation and heating.

GHP systems have 3 main components –

  • Ground Heat Exchanger – can be either ‘open-loop’ or ‘closed-loop’ with multiple loop configurations possible. ‘Vertical closed-loop’ is the most popular in New Jersey.
  • Heat Pump Unit – the indoor mechanical component that replaces conventional heating and air conditioning units in the building.
  • Building Distribution System – can take several forms, such as ductwork for forced air systems or piping for radiant floor heating.



The dominant loop configuration in New Jersey is the vertical closed-loop system where 1-1.5-inch high-density polyethylene (HDPE) pipes are inserted into narrow boreholes. The boreholes are 4-6 inches in diameter and usually less than 500 feet deep. A water-based heat transfer fluid, often containing 20% of an antifreeze additive of either propylene glycol or ethanol, circulates within the pipes. Open-loop systems use a water supply well and rejection well. Compared to closed-loop systems, they have lower first-costs, but can suffer from fouling and require additional maintenance. (Image source:

The Bureau of Climate Change and Clean Energy is working with the NJ Board of Public Utilities, the Bureau of Water Allocation & Well Permitting, and the Geological & Water Survey to encourage adoption of GHP systems in the State.

Considering GHP for your building?Look for GHP professionals that are certified by the National Groundwater Association (NGWA) or the International Ground-Source Heat Pump Association (IGSHPA).

For more information regarding ground-source heat pump systems, rebates and Sustainable Jersey for Schools certification, visit:

NJBPU Clean Energy Program's Home Performance with EnergyStar
NJBPU Clean Energy Program's Smart Start Buildings
Sustainable Jersey for Schools Actions
DOE Geothermal Heat Pumps



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Last Updated: February 13, 2020