(Bloomberg) -- It may seem old school, but a group of investors wants to help New Yorkers tap the power of the Earth to heat and cool their homes.
Geothermal energy, which was used by ancient Romans, Chinese and Native Americans as a heat source, may be able to power systems that can replace old residential oil furnaces. Dandelion Energy Inc., a New York-based startup, just raised $4.5 million from a group of venture capitalists led by New Enterprise Associates, more than tripling its $2 million in initial funding.
Dandelion will use the money to expand and complete a backlog of homes that signed up to install geothermal systems, Chief Executive Officer Kathy Hannun said in an interview. The systems, which would be cheaper and more environmentally friendly than traditional furnaces, circulate water through a closed piping system buried as much as 500 feet under the home and use compressors to concentrate the natural heat, she said.
“We’re really focused on New York,” Hannun said. Millions of homeowners in New York who use traditional furnaces could save as much as 20 percent by switching their heat and air conditioning systems and “don’t even think of geothermal as an option.”
Some of the savings could come in the form of renewed federal tax credits, which offset up to 30 percent of the cost to install home geothermal energy systems, she said. Dandelion has targeted about 2.5 million New York homes that use oil or propane for heat, she said.
Dandelion also announced that Daniel Yates, founder of Opower Inc., a utility software company, would be joining its board, according to a statement.
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