Geothermal heat pump cost in Ontario
A ground-source geothermal heat pump typically costs $25,000 to $45,000 installed in Ontario, before HST. The ground loop accounts for most of the gap with an air-source system, and whether it pays off depends mainly on the fuel you are replacing.
Geothermal heat pump cost in Ontario, 2026
Heats and cools$25,000to$45,000
Typical installed price, Ontario 2026
- Low end
- $25,000
- Midpoint
- $35,000
- High end
- $45,000
Typical installed price for a whole-home ground-source system in Ontario, before 13% HST ($28,250 to $50,850 with HST), including the ground loop and the indoor heat pump. Assumes usable ductwork.
On this page
How ground-source heating works
Below a few metres, the ground stays near the area's average annual temperature all year, far warmer than January air. A ground-source system circulates water and antifreeze through buried plastic pipe to collect that heat, and an indoor heat pump concentrates it and sends it through your ducts or into in-floor heating. In summer it runs in reverse. Because the loop temperature barely changes in winter, efficiency stays far steadier than an air-source heat pump's, and there is no outdoor unit to keep clear of snow. Canada's minimum efficiency standard for closed-loop units is a heating COP of 3.1 at the standard rating condition (0°C fluid entering the unit): 3.1 units of heat for every unit of electricity. It is also the most expensive system to install: in the index on the Ontario Furnace Prices home page, geothermal is the only range that starts past the end of the shared price scale.
Loop types and what pushes the cost up
Horizontal closed loop
Pipe in long trenches below the frost line. Usually the cheapest loop where there is open land.
Vertical closed loop
U-shaped pipes in drilled boreholes. Small footprint, but it needs a drill rig and an approved driller.
Open loop
Groundwater pumped from one well through the heat pump and returned through another. Needs good flow and water quality.
| Loop type | What it needs | What pushes the cost up |
|---|---|---|
| Horizontal closed loop | Plenty of open land and room for an excavator | Rock or hardpan near the surface, long trenches for a large heat load, landscaping repair |
| Vertical closed loop | A drill rig on site; a small footprint | Total borehole depth, bedrock vs softer overburden, rig access, an approved driller, spoil cleanup |
| Open loop | A well with enough water of suitable quality, and somewhere to return it | Drilling a supply or return well, water treatment, pumping energy, water-taking approvals |
Loop length or borehole depth is sized to the home’s heat loss, so a larger or leakier house needs more loop of any type.
Vertical loops come with a specific Ontario rule. Under Ontario Regulation 98/12, in force since 2012, installing a vertical closed loop with boreholes deeper than 5 metres requires an Environmental Compliance Approval, backed by a work plan from a licensed engineering practitioner or professional geoscientist that covers monitoring for hazardous gas. The approval belongs to the installer or driller, so ask yours to confirm it. Open loops pump groundwater, and Ontario requires a Permit to Take Water for takings over 50,000 litres a day; your designer should say whether your system's flow triggers one.
What moves the price
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Loop size and ground
Raises the price: Scales with heat load
The loop is sized to the home’s heat loss, and dry sand moves heat poorly, so it needs more loop than moist, dense soil. Larger or leakier houses need longer trenches or more borehole depth.
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Vertical drilling
Raises the price: Depth and drill time
Boreholes need a rig, grouting and an approved work plan. Bedrock near the surface drills slower than softer overburden.
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Site access
Raises the price: Can add days of work
Rigs and excavators need a path to the yard. Fences, tight side yards, septic beds, wells and mature trees limit where the loop can go.
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Landscaping repair
Raises the price: Often extra
Trenching and drilling leave spoil and torn-up lawn. Ask whether regrading, sod and spoil removal are in the price.
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Ductwork
Raises the price: +$500 to $3,000+
A geothermal unit delivers warm rather than hot air and needs good airflow. A home without ducts needs new distribution or in-floor heating.
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Electrical work
Raises the price: +$500 to $2,500
A heavy circuit for the heat pump, its loop pumps and backup heat. A full 100-amp panel may need an upgrade at $2,000 to $4,500.
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New build or major renovation
Lowers the price: Often lower
Laying the loop while the site is already being excavated avoids digging up a finished yard later.
Find out what your lot allows
Loop type, site access and the heat load set a geothermal price. A free in-home estimate checks all three and can price an air-source option alongside.
Free, no obligation. About a minute to request.
Geothermal vs air-source heat pumps
| Feature | Geothermal (ground source) | Cold-climate air source (ducted) |
|---|---|---|
| Typical installed price | $25,000 to $45,000 | $9,000 to $18,000 |
| Heat source | Ground loop at a steady temperature | Outdoor air, coldest when you need heat most |
| Efficiency in deep cold | Steadier, because the loop temperature changes little | Falls as the outdoor temperature drops |
| Outdoor equipment | None above ground | An outdoor unit to keep clear of snow |
| Disruption | Drilling or trenching in the yard | Mostly indoors and at one exterior wall |
| Home Renovation Savings, as published October 4, 2026 | $3,000 for natural gas homes, or $2,000 per ton up to $12,000 for the non-gas category | $500 per ton up to $2,000 for Enbridge gas homes, or $1,250 per ton up to $7,500 for electricity, oil, propane or wood |
Prices before 13% HST. Rebates require pre-installation approval and eligibility; programs change.
At the midpoints of the two ranges, geothermal costs about $21,500 more than a ducted air-source heat pump before any incentive. Whether steadier deep-cold output and lower running costs justify that is arithmetic. See air-source heat pump prices for the cheaper option.
Payback depends on the fuel you replace
We do not publish payback years, because they depend entirely on your numbers. This is how to work them out:
Simple payback in years = (geothermal price, minus the price of the system you would otherwise buy, minus any incentive actually approved) ÷ (yearly running cost of that system, minus yearly running cost of geothermal).
The bottom half, the yearly saving, is where most estimates go wrong. A worked example at default rates, for a home that needs 20,000 kWh of heat a year:
| Heating system | Assumption | Energy used per year | Yearly cost |
|---|---|---|---|
| Gas furnace | 96% AFUE | about 2,010 m³ | about $1,010 |
| Electric baseboards | COP 1 | 20,000 kWh | $3,000 |
| Cold-climate air-source heat pump | Seasonal COP 2.5 | 8,000 kWh | $1,200 |
| Geothermal heat pump | Seasonal COP 3.0 to 3.5 | about 5,710 to 6,670 kWh | about $860 to $1,000 |
Default rates: gas about $0.50 per m³ all-in, electricity about $0.15 per kWh all-in, 1 m³ of gas = about 10.35 kWh. Seasonal COP values are planning assumptions, not ratings for any model. Cooling and fixed monthly charges are not included.
- Yearly difference when replacing a gas furnace
- $10 to $150
- Yearly difference compared with air source
- $200 to $340
- Yearly difference when replacing baseboards
- $2,000 to $2,140
Against natural gas, the yearly difference is small next to a premium in the tens of thousands of dollars, so running costs alone do not recover it. Against air source it is a few hundred dollars a year. Against baseboards it is about two thousand dollars, though a baseboard home also needs ducts or in-floor heating. Oil and propane usually cost more per unit of heat than gas, so those homes sit nearer the baseboard end; check with your bills or the heating cost calculator.
Rebates for ground-source systems
Home Renovation Savings publishes separate amounts for ground-source heat pumps. As published at our last check (October 4, 2026):
- Homes heated by natural gas: $3,000.
- The non-gas category (homes heated by electricity, oil, propane or wood): $2,000 per ton, up to $12,000.
The per-ton figure uses the closed-loop heating capacity, or the open-loop capacity for open-loop-only equipment. Rentals have separate caps, replacing an existing heat pump used for space heating is excluded, and homeownership, home type and product rules apply. Payment guidance is about 60 days after post-installation approval. The Canada Greener Homes Loan closed to new applications on October 1, 2025.
Pre-approval comes before the drill rig
Pre-installation approval is mandatory, so apply and get approval before any drilling or trenching starts. Programs change: confirm the rules and your eligibility before you sign. We never promise a rebate amount.
More detail is in heat pump rebates in Ontario and the Ontario HVAC rebates overview.
Sources
- Home Renovation Savings: heat pumps checked October 4, 2026
- Home Renovation Savings: terms and requirements checked October 4, 2026
- Natural Resources Canada: Canada Greener Homes grant process new Canada Greener Homes Loan applications closed October 1, 2025
- Ontario: installing vertical closed loop ground source heat pumps
- Ontario: permits to take water
- Natural Resources Canada: ground-source heat pump efficiency regulations
Is geothermal a good fit for your home?
Stronger case
- You heat with oil, propane or electric resistance today
- You have open land for a horizontal loop, or clear access for a drill rig
- You plan to stay long enough for running-cost savings to add up
Harder case
- You heat with natural gas at current rates
- A small lot with no path for a drill rig or excavator
- The home has no ducts and adding them is not practical
Questions to ask before you sign
Bring these to every geothermal quote
- Which loop type did you design, how long is the loop or how deep are the boreholes, and which heat loss calculation is it based on?
- Is the system designed and installed to CSA C448, the Canadian standard for earth energy systems?
- Who does the drilling, and do they hold the Environmental Compliance Approval required for vertical boreholes deeper than 5 metres?
- Is the model eligible for Home Renovation Savings, and who applies for pre-approval?
- What warranties cover the loop, the heat pump and the labour, and is backup heat included?
Questions people ask
How much does a geothermal system cost in Ontario?
A whole-home ground-source heat pump typically costs $25,000 to $45,000 installed, before HST, including the loop. Drilled vertical loops tend to cost more than horizontal loops on open land, and rock, poor access, landscaping repair, ductwork and electrical upgrades push quotes up. A ducted cold-climate air-source heat pump, for comparison, runs $9,000 to $18,000.
Is geothermal worth it if I have natural gas?
On running costs alone, rarely at today's rates. At this site's default prices, gas heat from a 96% furnace costs about 5.0¢ per kWh and geothermal heat about 4.3¢ to 5.0¢, so the yearly saving is small next to a premium of tens of thousands of dollars. The case is far stronger when replacing oil, propane or electric heat.
How long does a geothermal loop last?
The buried polyethylene loop is built to outlast the indoor heat pump by a wide margin; the indoor unit is the part that eventually gets replaced, much like a furnace or air conditioner. Loop life depends on the pipe, the joints and the installation, so get the loop warranty in writing and keep the design records with the house papers.
Can geothermal work on a city lot?
Sometimes. A horizontal loop needs more open land than most city lots have, but vertical boreholes take up little surface area if a drill rig can reach the yard. Driveways, fences, tight side yards and buried services usually decide it. Open loops need a suitable well, which is uncommon in serviced urban areas.
Is there a geothermal rebate in Ontario?
Home Renovation Savings published ground-source amounts at our October 4, 2026 check: $3,000 for homes heated by natural gas, or $2,000 per ton up to $12,000 for the non-gas category. Pre-installation approval is mandatory, and product, home and ownership rules apply. Programs change, so confirm the current terms before any drilling starts.