Has Geothermal Hit a Tipping Point?

by Tim Weber | Co-founder, Diverso Energy

Ryan Kwok, Unsplash, https://unsplash.com/photos/BxR1MJ8ca60

Having spent the past 16 years in the geothermal industry, I’ve experienced a steady but moderate uptake in the technology. Within the past 6 months however, I’ve witnessed something completely new.

2021 appears to be the year everything changes in the GTA condo and rental developers. Traditionally, due to cost, complexity, and perceived risk, geothermal has been a non-starter for most developers even if it meant almost eliminating carbon emissions. I can’t say I blame them; the real estate market is strong, units are selling quickly and there’s no pressure to change regardless of the environmental impact.

That being said, we have seen a significant shift in attitude and interest levels regarding geothermal. One of the key drivers is the Toronto Green Standard (TGS) which will be moving to Version 4 as of May of 2022. This will have a significant impact on building design now that energy and greenhouse gas targets are aggressive enough that in most cases, heating with natural gas will no longer be possible.  This represents a major problem for developers who are resistant to change. Building designers also feel the pressure as they are often tasked with solving this problem. Geothermal has become the silver bullet because it addresses both the GHG and energy targets while also freeing up space on the roof providing an overall improvement to the building. 

With the increased interest in Geothermal, developers are naturally inclined to apply traditional procurement methods to this new technology. Unfortunately, a successful geothermal system does not fit into the traditional methods. It is not a standard piece of equipment or design that can go out to tender but rather an energy source that the building is relying on for its lifespan. Because no two buildings are identical, it needs to be uniquely designed and installed to address the nuances and needs of each project. Geothermal is not chiller or cooling tower and Developers who appreciate this differentiation will save themselves from potentially disastrous construction or operational issues.

Fortunately, there are many developers who do recognize the importance of a different procurement process and understand the benefit of partnering with a provider who is both experienced and focused on all aspects of geothermal including design, execution and long-term management. These successful projects will demonstrate to other developers and municipalities that if done correctly, geothermal will seamlessly bridge the gap from fossil fuels to fully electrified buildings.