MyBiz: From the ground up

You could say John Schmidt got in on the ground floor for geothermal heating and cooling.

“When I was 15 years old, I was reading about geothermal and interested in more efficient ways of heating and cooling homes,” Schmidt, 68, recalled one recent afternoon. “I read that the ground was 55 degrees at five feet and below, and I wanted to make sure that was correct, so I went out in the back field and dug a hole late in the summer and measured the temperature and by gosh, it was true.”

Prompted in part by his parents’ “horrible” heating bills at their rural Solon farmhouse, Schmidt attended Kirkwood Community College for a year after high school. He got a solid working background there in heating, ventilation, and air conditioning (HVAC), but he was largely on his own when it came to the then-new geothermal field. He learned Oklahoma State University had installed a geothermal system on its campus.

“So, I did my studying mostly with publications from Oklahoma State,” Schmidt said. “After I studied enough and figured out how to do a system I asked my parents, ‘If I give you this stuff for cost and do it for free, can I put this system in your home?’ Just one year out of high school. They said ‘OK,’ because their utility bills were terrible and I told them it could be better. I installed that system, and that same system is still in their house today. It worked really well. From there, I did some neighbors’ homes and it just branched out.”

Schmidt went to work for contractor Elmer Vanorny, and the pair launched E & J Geothermal in 1976. Vanorny retired about a year later.

Developed largely in Scandinavian countries, systems for tapping the earth’s natural heat were just gaining attention in the U.S. The systems circulate a water-based fluid through a loop of buried pipes, drawing heat in the winter. In the summer, heat from indoor air is circulated through the cooler loop.

“Nobody had heard of it or knew what it was,” Schmidt said. “I used my parents’ home as a model and example. I could show people their utility bills before and after, and it just took off from there.”

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The Environmental Protection Agency found homeowners save up to 70 percent in heating costs with a geothermal system, and 20 to 50 percent in cooling costs. The development of polybutylene pipe in the late 1970s made installation cheaper and easier, and today’s forced-air systems are much quieter, but the fundamentals remain the same.

Schmidt and his 20 employees will install and maintain conventional HVAC systems if a customer insists. While a geothermal system’s initial purchase and installation costs are typically higher than a conventional system’s, its efficiency, tax credits, and utility rebates tend to level the field.

“Almost always they pick geothermal,” he said. “When it started out, people wanted it to save money on their utility bills. That’s still there, but now there’s a lot of people whose main concern is the environment.”

Pairing a geothermal loop with a solar array, as at E & J’s Solon offices, can make a property virtually energy independent.

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“Solar makes electricity, and geothermal just uses electricity,” he said. “If they have a geothermal system in their home and have solar, they can achieve a net-zero bill.”

About half E & J’s work today is retrofitting geothermal systems to existing homes, according to Tom Rutkowski, the company’s vice president.

“As costs have increased for homes, people are looking for cheaper ways to get into a home, so it’s gotten a lot more competitive on that side,” Rutkowski said. “When they realize they didn’t have this efficient heating and cooling, we’re going in and retrofitting a system to their homes.”

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