In a nutshell, the Seward Heat Loop Project reduces the reliance on heating oil and electric heat in four city buildings by using a ground-source carbon dioxide (CO2) heat pump. Ground-source loops derive heat from a closed loop of vertical boreholes at Waterfront Park adjacent to Resurrection Bay. Tidal movements are key to providing an initial heat source: an influx of warm seawater from the Alaska Coastal Current flows into the bay each fall, then the North Pacific Gyre heats this current during a three-year circuit along the equator. Due to this influx, Resurrection Bay remains ice-free year-round. During winter months water temperatures can reach 50°F in November while the air temperature is 22°F, frequently causing steam.

Andy Baker, founder and owner of YourCleanEnergy (YCE), is the designer who conceptualized the unique combination of heated water from Resurrection Bay with heat pump technology to heat an entire building. In 2012, Baker designed and installed a heat pump system using a synthetic refrigerant known as R-134a; however, Baker quickly replaced R-134a with CO2 to eliminate the synthetic refrigerant’s environmental impact.

“Synthetic refrigerants contain PFAS [per- and polyfluoroalkyl substances] fluorination compounds that eventually leak from the heat pump circuit into the atmosphere,” says Baker. “By using CO2, we are preventing super greenhouse gases from rising into the air and ending up in the water.”

Resurrection Bay already heats one building complex in Seward: the Alaska SeaLife Center. However, the Seward Heat Loop Project proposes a different configuration. The center pumps seawater directly from Resurrection Bay into a heat exchanger, but the Seward Heat Loop Project relies on the thermal mass of the seabed. Vertical loops will be inserted into 200 feet of gravel that is saturated by Resurrection Bay, resulting in a consistent temperatures of 45°F. A mixture of water and propylene glycol will be piped down the hole and back up to the surface, collecting tidal and groundwater heat along the way. The mixture is then piped to the heat pumps, which turn CO2 from a liquid into vapor. The vapor is then compressed to nearly 2,000 pounds per square inch, adding significantly more heat. The hot vapor circulates through a gas cooler that transfers much of its heat into a 100°F hydronic loop that is heated up to 194°F. The 194°F hydronic water leaving the heat pumps is blended into a large building loop that is kept at 140°F to 160°F and further distributed to Seward’s library, city hall, the city annex, and the fire hall.

“Pumping seawater directly into the heat exchanger is high maintenance because saltwater is corrosive,” says Baker. “Using the tidal flush in deep gravel is a novel approach to heating buildings in coastal Alaska.”

When first proposed in 2015, the Seward Heat Loop Project acquired $725,000 in grant funding from the Alaska Energy Authority. The design process continued through 2019, when the project stalled due to COVID-19, multiple changes in city managers, budgetary constraints, and necessary adjustments to the project’s concept and scope. In 2022, the City of Seward formed an ad hoc committee under the Port and Commerce Advisory Board (PACAB) composed of community volunteers to help find funding and develop a shovel-ready design. The PACAB Heat Loop Committee is one of five organizations that make up the Community Coalition Team involved with the development of this project. Additional members include the City of Seward, YCE, the National Renewable Energy Laboratory, and the Alaska Vocational Technical Center (AVTEC), a state-run industrial training school in Seward.

Within six months of its formation, the Community Coalition Team won a highly competitive US Department of Energy (DOE) grant for $315,000. Out of fifty applicants, DOE selected only eleven projects for Phase 1 funding, which takes a project from concept to the point that it’s ready for construction. In September, the team will apply for $3.8 million in Phase 2 DOE funding for construction. In this round, the Seward Heat Loop Project will compete with ten other projects, of which three to six will be selected.

“We are dedicated to bringing renewable energy to Seward,” says Mary Tougas of the PACAB Heat Loop Committee. “Andy’s design is such a genius idea. It’s such a simple concept that it makes you smack your head and ask, ‘Why didn’t we think of it sooner?’”

The decision to heat only four city-owned buildings is mainly for funding purposes. Projects that benefit the public have a better chance to meet the grant criteria, so the team chose four public buildings in close proximity to one another with the most usage. Baker says making this project 100 percent public avoids inequities that could arise from creating a conventional heating district project.

“This is a demonstration project that could be expanded at some point in the future if we are successful,” says Baker.

The construction cost was estimated at $4.5 million when initially proposed in 2015. In 2022, the committee increased the cost estimate to $4.7 million for the DOE grant application. There are several reasons for the increase. Costs for materials and labor have gone up since the project started. Several add-ons, like heated sidewalks in front of the library, weren’t in the original proposal but are features community members would like included in the final project. Given all the factors, Baker hesitates to speculate on the construction cost without the final review of an estimator.

“For DOE, it’s not just about the cost,” says Baker. “This is a new process, so installing it is more costly at first. It becomes more affordable as more people adopt it and we find ways to make it more scalable.”

As the founder of YCE, Baker’s primary focus is developing alternative energy processes that decrease environmental impact. However, he is business savvy enough to know that a project isn’t going to succeed if it isn’t economically viable. According to the final design memorandum, heat pumps at the Alaska SeaLife Center have already proved beneficial. Even though the original heat pumps used the synthetic R-134a refrigerant, the system still reduced the center’s use of heating oil by 48,104 gallons, with a net CO2 emission reduction of 420,000 pounds and produced a financial net savings of $120,000. Since replacing the synthetic refrigerant with CO2, the SeaLife Center has produced net energy savings of $135,000 and reduced CO2 emissions by 1.3 million pounds.

The memorandum also outlines the increasing cost of heating oil for the four buildings chosen for the Seward Heat Loop Project. In FY13, after the library was built, the total cost for heating all four buildings jumped to $67,605. In FY14, the price dropped slightly to $57,031 due to a global oil price crash. The library currently has an electric boiler installed as an alternative heating method; however, the oil-fired boiler is still a more cost-effective heating source. By using a ground-source CO2 heat pump system, the city estimates a 62 percent reduction in heating costs for the library compared to the existing electric boiler. For all four buildings, the reduced heating costs are estimated at around 52 percent compared to using existing heating boilers, at heating oil prices of $3.99 per gallon.

“We have few cost-effective, environmentally friendly options to heat our buildings here in Seward,” says Tougas. “Other than heating fuel, we have electricity, firewood, and a small amount of propane. We don’t have natural gas.”

Electricity from the primary grid still powers the heat pump system; however, the committee has identified solar panels as a clean energy source for this purpose. This add-on is not in the original proposal and depends on what DOE approves in the upcoming grant submission.

Among a list of requirements, the Phase 1 DOE grant includes an allocation for workforce development. The PACAB committee used grant funds to purchase a SanCO2 residential heat pump, which employs the same carbon dioxide heat pump technology as the ones used in the proposed heat loop, for training purposes. Instructors from AVTEC are crafting a curriculum based on a recent intensive training and certification course with the system’s co-designer earlier this year.

In a committee press release, AVTEC Director Cathy LeCompte expressed her excitement about the opportunity to weave this new training curriculum into the center’s existing program.

AVTEC is a division of the Alaska Department of Labor and Workforce Development that provides post-secondary workforce training that is flexible, accessible, affordable, and responsive to the dynamic needs of business and industry and serves Alaska’s diverse communities. AVTEC delivers training statewide in refrigeration, plumbing and heating, information technology, industrial electricity, construction technology, business and office technology, and more. A course in operating and maintaining the heat loop in Seward and future deployments will fit perfectly into AVTEC’s structure.

As the Community Coalition Team works on the final requirements of the Phase 1 DOE grant, there is much optimism going into the Phase 2 application process.

“The design system used in this demonstration project has the potential to benefit all coastal communities in Alaska,” says Tougas. “We look forward to the next stage and beyond.”