A new residential development south of Denver is serving as a demonstration project for ground-source heat pump technology, featuring nearly 100 homes constructed by Lennar and equipped with geothermal systems developed by Dandelion Energy. The partnership aims to showcase how this heating and cooling technology could become more widely adopted across the country.
Ground-source heat pumps operate by drawing on steady underground temperatures to heat and cool buildings, typically requiring boreholes drilled several hundred feet deep. Dandelion claims its approach can complete such installations at roughly half the cost and twice the speed of traditional geothermal projects through the use of a lightweight drilling rig that moves efficiently from lot to lot. At the Ken Caryl Ranch development, each home receives a single borehole between 200 and 500 feet deep, where temperatures remain around 50 degrees Fahrenheit year-round. Water circulating through pipes absorbs or releases heat from the surrounding earth before a basement-mounted heat pump provides additional climate control.
The efficiency advantages of ground-source heat pumps appear particularly pronounced during cold snaps, when they reportedly use a quarter as much electricity as air-source alternatives. Dandelion and Lennar launched a broader initiative in 2025 to install geothermal systems in more than 1,500 Colorado homes over two years, with plans to scale to 10,000 installations annually nationwide. According to a 2025 Department of Energy report, geothermal heating and cooling could reach 7 million U.S. homes by 2035, potentially reducing winter peak energy demand by over 40 gigawatts and saving approximately $4 billion annually in grid costs.
Despite the technology’s benefits, ground-source heat pumps remain a small fraction of new heating installations, with just over a million U.S. homes currently equipped with the systems compared to 3.6 million air-source heat pump sales last year. High upfront costs averaging around $25,000 per home present a significant barrier, though Colorado’s utility rebates and state tax credits help offset expenses. Additional challenges include space constraints in dense urban areas and varying permitting requirements across jurisdictions.
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