For years, the buzzwords on the lips of environmental advocates have been geothermal energy, as in energy pumped from deep within the Earth’s aquifers to be used for heating, cooling and electricity generation. Tax credits for geothermal technology are one of the few environmental initiatives that did not suffer major cuts in the so-called “Big, Beautiful Bill,” the budget recently signed into law by President Donald Trump.

With the goal of weaning more city systems off gas boilers and fossil fuel-generated power, the city of St. Paul has begun installation of a $16 million geothermal unit at the Como Zoo to support both the primates and polar bear buildings, and looking at the possibility of doing the same to support a third zoo building down the line.

“It’s underway, but moving a little slower than we had hoped,” said Russ Stark, the city of St. Paul’s chief resilience officer. “There’s some complexity with doing that type of heavy equipment project in a zoo, with the animals.”

Russ Stark, chief resilience officer with the city of St. Paul. (Courtesy of the Office of Mayor Melvin Carter)

A well for the new geothermal unit at the future Hamline-Midway Library on Minnehaha Avenue is already in the ground, and other geothermal projects are rolling out at the future Wakan Tipi Center within the former Bruce Vento Nature Sanctuary outside downtown St. Paul, and at the future Hidden River Middle School under construction on Summit Avenue.

Both Xcel Energy and Cooperative Energy Futures of Minneapolis are planning pilot projects that likely would connect a series of buildings, or commercial and residential sites, through a geothermal system, which St. Paul could potentially be a candidate for.

Religious institutions look for energy sources

Some religious institutions are praying for financial help not just to replace their own aging boilers, but to possibly share power for blocks around.

Zion Community Commons, also known as Zion Lutheran Church, near Snelling and Lafond avenues, shoulders winter energy bills that can run to some $2,000 monthly, or more, according to the Rev. John Marboe. That’s led the church to explore whether replacing its 1912 boiler with a geothermal unit could help heat and cool neighboring residences, despite upfront costs that could reach anywhere from a few hundred thousand dollars for their facility alone or into the millions of dollars if they serve nearby homes.

“We as a church have few financial resources to accomplish this, but a great deal of heart and rich relational resources in the neighborhood,” said Marboe, who recently toured the four-well geothermal installation at the Steamfitters-Pipefitters building outside downtown St. Paul on L’Orient Street.

“We’re not cash-rich,” Marboe added. “In fact, we’re cash-poor. Therefore we hope and work for a cooperative approach to clean energy for all, and want to play the role we can in it, and create something that would be good for the whole neighborhood around. In the 1950s, there was the political will to put gas lines everywhere. It can be done. These are just water pipes.”

Gloria Dei Lutheran Church, at the corner of Snelling Avenue and West Highland Parkway, has been exploring the same possibility of serving as a neighborhood heating and cooling node, using a future geothermal installation much like a solar battery might serve multiple users.

“That’s in the soup of the whole larger conversation, for sure,” said Gloria Dei Pastor Jodi Houge. “We are in the exploratory phase. We haven’t committed one way or the other, but … we know there’s an expiration date somewhere (for our boiler). We just can’t say when.”

A citywide geothermal system?

A district system that would heat and cool four industrial parcels, as well as hundreds of housing units in multi-family buildings, is moving forward at the north end of the Heights, the new residential community planned at the site of the former Hillcrest Golf Club on the city’s East Side. The St. Paul Port Authority, which purchased the land for redevelopment, will remain a partner in the new “Heights Community Energy” district system alongside Ever-Green Energy, the for-profit affiliate of nonprofit District Energy St. Paul.

Volunteers worked at one of 30 housing sites being built at the Heights in St. Paul on Monday, Sept., 30. 2024. (John Autey / Pioneer Press)

“It’s what is allowing us to build the Heights as a carbon-neutral development,” said Kristine Williams, senior vice president of real estate and development with the St. Paul Port Authority.

In addition, Xcel Energy is building a new service center at the Heights to handle its gas accounts, and perhaps ironically, that building will also be heated by its own 12-well geothermal system and a large solar array, which are under construction.

Advocacy groups such as Unidos are thinking even bigger, pushing for geothermal systems to support entire neighborhoods, if not the city as a whole, to move residents off gas heat entirely, in a similar vein to the St. Paul District Energy system downtown. They foresee residents and business owners buying into the system, like subscribers, ultimately reducing costs for everyone.

“We know there are two options to replace gas infrastructure with clean heat — the city raising capital to do it, or the city pushing Xcel to do it,” said Madi Johnson, a climate organizer with Unidos. “You can also take an existing thermal energy system and expand it. They’re drilling a well at the Hamline Library right now. Theoretically, we could expand that into a loop down the road, and add that to a citywide network.”

St. Paul will soon renegotiate franchise fees with Xcel Energy, which could offer a starting point for funding. In Framingham, Mass., Eversource Energy launched a $15 million networked geothermal — or “ground source” — system last summer that heats and cools 36 buildings, allowing excess heat from one structure to be transferred to another as needed.

In St. Paul, “the city is making use of (geothermal installations) for itself,” Johnson said. “Actually what we’re talking about is opening up a thermal market, which could be revenue generating.”

Given funding constraints, City Hall officials have tried to temper expectations.

Biggest challenge: Upfront costs

Stark, the city’s chief resilience officer, said geothermal energy can be a powerful tool, but it’s not necessarily the best one for every situation, and it becomes less cost-effective when looking at single-family homes, as opposed to larger apartment buildings and institutional structures. The biggest challenge, he said, is upfront cost of installation.

For single-family homes, a cheaper way to go may be air-source heat pumps, which can transfer heat directly from outside air, even in the winter, for heating and reverse the process in the summer. They work best when a home is weatherized, or air-tight, which also carries costs.

Geothermal is “a substantial part of the solution of moving away from fossil fuels. But it makes the most sense when current energy costs are really high,” said Stark on Thursday. “That’s the case out at Como, for example. You’ve got an old, inefficient boiler. Even though there’s a substantial capital cost, there’s more financial sense to a project like that, in terms of long-term savings, than geothermal for your home.”

“If there’s a block in St. Paul that has a big church on it, and they have relatively high energy bills, and they want to explore a system that other apartment buildings can plug into it, I think it makes sense,” Stark added. “But when you’re talking about single-family homes, the cost per home is going to be relatively high. The more people who pay into it, the lower the cost.”

Adding nearby homes and other users to a system requires pricey infrastructure, billing and other details that can get complicated fast.

“Pretty quickly, you’re talking about some kind of a utility,” Stark said. “Who owns and operates that utility? Some of that equipment is going to be in the city right-of-way. There’s an Energy Park utility that serves almost all of the buildings between Snelling Avenue and Lexington Parkway on Energy Park Drive. We’re building out a district system at the Heights. In other cases, it might be Xcel.”

‘Big, Beautiful Bill’ spares geothermal

Over the next three years, the city of St. Paul had anticipated receiving $4.9 million in clean energy tax credits to support projects like the Como Zoo geothermal system, electric fire trucks, Evie Spot Network EV chargers and solar installations on the new Fire Station No. 7 and Animal Services building.

Then came the One Big Beautiful Bill Act, Trump’s new budget document. While offering tax cuts or increasing spending in some areas, the legislation has gutted environmental funding by creating new cutoffs and requirements, putting some clean energy dollars all but out of reach.

“The changes to clean energy tax credits not only puts the financing of current projects at risk, but they also threaten future investments, especially now that a new executive order introduces stricter eligibility rules for projects planned in the coming months,” said Jennifer Lor, a spokesperson for St. Paul Mayor Melvin Carter’s office. “These proposed regulations could make qualifying for tax credits practically impossible for many projects that rely on this financing.”

“Because this bill changed eligibility so significantly, it’s speeding up our timing of 2026 projects and altered our long-term plan,” Lor continued. “For example, the changes cut off eligibility for claiming credits on the second electric fire truck or solar projects beyond 2027.”

The city’s Urban and Community Forestry Project, which funds forestry training programs for youth, likely will be impacted, as the bill eliminates funding once the contract ends, Lor noted. Throughout the program’s five years, St. Paul youth will have helped plant more than 1,800 new trees and remove 1,100 stumps, she said.

Geothermal projects have fared better, however, than solar projects and other initiatives. A provision that allows municipalities and other non-taxpaying entities to apply for a 30% credit, or pay-back, off the cost of a new geothermal project after it’s up and running survived the environmental cuts in the legislation.

At the same time federal cuts hit clean energy programs, few expect the mayor to unveil heavy spending on new initiatives in his 2026 budget proposal this month, given rising property taxes, inflation and other financial pressures. On top of the city’s financial challenges, St. Paul Public Schools has proposed a major property tax levy referendum that would add $300 to the annual tax burden shouldered by a median-value St. Paul home.

Nevertheless, Unidos has met with the mayor and attempted to meet with all seven city council members to ask for 1% of next year’s city budget — or $8.5 million — to fund climate initiatives, including geothermal projects. Unidos plans to further advocate for those projects during its next Climate Action Summit at Cesar Chavez Academy on Oct. 5.

“This is the hardest possible moment we could be asking for climate funding,” Johnson said, “but the most expensive thing we can be doing is nothing.”

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