District heating and cooling, typically powered by steam, is going underground in a small Iowa town.
The community of West Union, with a population just shy of 2,500, has completed a geothermal system beneath its town square, and early this year began providing heating and cooling to nearby businesses. About a dozen now are connected to the system, and more are expected to join.
While several universities have installed large-scale geothermal systems to serve multiple buildings, the West Union project is believed to be one of the first of its kind for a municipality.
“There’s not anything like it in the Midwest, we are finding,” said Robin Bostrom, program director of Main Street West Union, a community development organization that was involved in the project.
‘Very much a learning experience’
In 2008, the city was devising a revitalization plan for its downtown. The Iowa Economic Department Authority heard about it and invited the town to serve as a pilot for a district geothermal system.
Since the downtown streets and sidewalks were going to be torn up anyway, the city agreed to drill 132 holes, 300 feet deep, to capture heat deep underground. The holes, all underneath the main square, are connected by a loop that’s ready to provide geothermal heating and cooling to about 60 businesses within about three blocks of the main square.
Property owners within the downtown district can join “when it’s feasible, and when it’s the right time for them,” Bostrom said.
One of the first customers to sign on was Fehr Graham, an engineering and environmental consulting firm with an office near West Union’s main square.
“We have been really satisfied,” said Jon Biederman, a civil engineer with the firm. “It’s really an improvement over what we had. The comfort level is really good.”
Biederman gives some of the credit for the improved comfort to the geothermal system, which he said provides a more even heat than forced-air gas. However, he noted that new windows and insulation upgrades undoubtedly have been factors as well.
Because West Union’s geothermal promoters could find no geothermal utility anywhere on which to model themselves, figuring out how to manage the system has been “very much a learning experience for the community,” Bostrom said. “We’re the guinea pig.”
The city, which owns the wells and pipes that carry the heat-transferring propylene glycol throughout the system, opted not to actually manage it. So the customers formed a limited liability corporation. They then hired an installer of geothermal systems to operate it for them.
The owners’ corporation is leasing the system from the city for five years, after which the city will have a chance to re-evaluate whether it wants to assume management of the utility.
The city managed to build the system with no local tax funds. The roughly $2 million price was covered mostly with a $1 million federal Department of Energy grant and a $500,000 Environmental Protection Agency grant. There were some other state funds, and some local in-kind donations, such as the use of the courthouse square for well drilling.
Because the system is, at least for now, rather small, the operators decided that instead of installing costly meters in each of the customer buildings, they would bill each customer on the basis of how much heating and cooling its heat pumps could produce – capacity rather than actual energy use. Currently, customers are billed $17.50 each month per ton of capacity.
“We’re hoping that’s going to come down,” said system manager Jim Bear. “Nobody can give us any guidance on what works and what doesn’t. We’re pioneers in this field. It’s been tough trying to see how this works. We don’t want to overprice it, but we want to make sure the city can pay the expenses.”
Although the system at this point has not cut the energy bills for most of the customers in West Union, geothermal energy typically reduces bills by at least two thirds, according to Bear. It requires energy only to operate pumps. Geothermal heating and cooling typically is from three to five times as efficient as natural-gas furnaces and electrically-powered air conditioners, according to Bear.
Dick Woodard owns an insurance company on the square that was connected to the system in February. He said he’s actually paying slightly more for geothermal climate-control – in the neighborhood of an additional $50 a month. In addition to the monthly fee that covers insurance, the initial capital expense and the manager’s salary, customers also must pay for electricity to run their heat pumps.
Like Biederman, however, Woodard said his offices are much more comfortable. The century-old downtown businesses in West Union were cold and drafty in the winter, and increased comfort has been one of the boons of the new system.
At the Fehr Graham engineering firm, Biederman guessed that the cost for heating and cooling is “pretty close to, or a touch under, what we had before.” Because the system went on-line in about March, Biederman said he can’t be certain how the ongoing cost will compare with the cost of the previous heating and cooling regimen.
Bear suspects that the geothermal system in West Union hasn’t achieved the anticipated financial savings in part because customers are heating and cooling more space. For example, he said, one business is now heating and cooling an 8,000 square-foot basement. And at least some of them are treating themselves to warmer winters and cooler summers — perhaps because they are now paying for capacity, rather than the actual energy they use.
“As more users get on the system, that’s when it gets efficient,” Bostrom said. “People will see their costs go down.”
The system should be able to serve about triple the current demand, according to Bear. He said that current customers account for about 130 tons of demand, and that he expects the system ultimately will be able to provide about 400 tons or heating or cooling.
Bostrom said that people from throughout West Union – homeowners as well as those with commercial properties – have expressed interest in getting connected with the geothermal system. Although expansion is not planned at this point, it’s been contemplated. There’s a second well field in a city park located three blocks from the main square and adjacent to a residential area, Bostrom said. It’s equipped with one test pump and a pump house.
The system is “open-ended,” she said, meaning that as demand develops, the system can grow to meet it.