With the high price of both oil and natural gas, it’s pretty clear that a lot of people are looking for alternatives, not just for transportation but also for home heating. Even the price of firewood is going up because home heating oil (diesel fuel) is so expensive now.
A lot of homeowners are now looking at geothermal heating and cooling installations. These systems consist of a geothermal unit located in the basement of a house, which is connected to a loop of pipe that is buried in the ground below the frost line. Water circulates through the loop of pipe, absorbs the heat from the ground and takes it back into the house.
A geothermal unit transfers the heat to become hot air or hot water, and moves it around either through standard air ducts or hydronic pipes. In hot weather, the system reverses itself, as heat is taken from the air in the house and put back into the ground, providing an air-conditioned environment.
These systems burn no fuel and do not create any greenhouse gases. All they require is a minimal amount of electricity to move the water around the ground loop.
One company that’s at the forefront of the manufacture of geothermal units is LSB Industries, Inc. (AMEX/LXU). Operating through a number of subsidiaries, this company manufactures and sells some of the most efficient geothermal and water source heat pumps in the business.
The company also boasts a chemical division that manufactures and sells nitric acids, metallurgical and commercial grade anhydrous ammonia, as well as other products for the agricultural and mining industries.
In its first quarter of 2008, LSB’s revenues grew nine percent to a record one hundred sixty and a half million dollars, up from revenues of more than one hundred and forty-seven million dollars.
Operating income grew 43% to over nineteen million dollars, while net income was almost eleven million, which was just over the net income generated in the first quarter of 2007.
I really believe in this technology and, if I were in the plumbing and heating business, I’d definitely get into geothermal installations. With the price of diesel fuel so expensive, you can bet that the price of a cord of wood will keep going up. Just about anyone heating with diesel fuel is now looking for alternatives.