You can’t control the weather. Nor can you control the price of oil or propane. And these two variables make heating and cooling a home expensive and unpredictable—a potentially devastating combination for homeowners.
There is a solution, but until recently, it was out of reach for most families. A geothermal energy system heats and cools buildings by harvesting thermal energy, found in abundance 10 feet below the frost line. These systems can reduce heating and cooling costs by as much as 60 percent. But in the past, installing them was expensive and cumbersome.
Not anymore. With patented technology, equipment, and processes, Dandelion Energy, a New York-based home geothermal startup, makes it possible for people with more modest budgets and smaller backyards to access geothermal energy. President and co-founder Kathy Hannun shares what inspired the groundbreaking idea, as well as tips for cultivating innovation at your own organization.
An opportunity to do something
The Dandelion concept was conceived in 2016 at X, the innovation lab of Google’s parent company, Alphabet. Hannun was a project manager, working to “find new big business opportunities.” No small feat.
She and her colleague James Quazi, Dandelion Energy’s cofounder and CTO, were intrigued by geothermal for a number of reasons. First and foremost, heating and cooling have an enormous impact on energy use and carbon emissions.
“We saw an opportunity to do something—to innovate in a way that is beneficial for homeowners who are spending a tremendous amount on heating and cooling, as well as for the environment,” says Hannun.
After a year of brainstorming and planning, Hannun and Quazi launched Dandelion Energy as a company independent of Google. They launched focusing on the Northeast residential market. In the future, they plan to expand into other territories as well as into the commercial real estate market.
For the benefit of the masses
Geothermal systems are comprised of underground pipes, called ground loops, that feed into a heat pump inside the house.
Another advantage of geothermal energy is that you never need to worry about filling a fuel tank. This makes it less expensive and eliminates the stress of fluctuating fuel costs. It is also quiet, compact, and reduces carbon emissions.
In the recent past, installing a geothermal system cost about $60,000, says Hannun. It was a luxury solution comprised of expensive products and processes. Dandelion found ways to cut the cost to an average of $18,000, after tax incentives. Most homeowners choose to take out a loan and pay off the system over time.
The key to cutting costs were new technologies and equipment. Traditional installers used well drills to create geothermal wells. Dandelion developed a smaller, lighter, more agile system. They also designed a less expensive heat pump, for mainstream use. The pump contains sensors so Dandelion can monitor performance remotely and service it promptly, should problems arise.
Simple secrets to innovation
Dandelion’s system is innovative, but Hannun says ingenuity doesn’t start with product—it starts with culture. “As a company, we are constantly questioning common knowledge,” she explains. “We don’t take things at face value.”
She urges other business leaders to stay curious, and to dig deep to fundamentally understand why things are the way they are. That is how you uncover opportunities, Hannum says. For example, industry insiders warned her that installing geothermal energy systems was expensive, in large part because you can’t predict what you will find underground. She and the team challenged that notion, developing tests and collecting data to improve their ability to predict what lies beneath—before they start digging.
To innovate, you must also be willing to fail, and to fail fast. At X, Hannun was encouraged to go after the hardest problem first, and to not be ashamed of failure.
Leaving a job she loved to start a company was risky, but she knew that being out on her own was the fastest way to learn if the idea had legs.
She and her team use these principles to continually improve processes and lower prices. They realize the current cost of the geothermal system remains a barrier to entry for most homeowners. By finding new ways to cut the cost even further, they hope to make geothermal energy a reality for more and more people across the Northeast, and beyond.