Cold Bedrooms, Cracked Foundations: Why Some Homeowners Are Fuming Over This Google X Spinoff’s Green Energy Errors

Dandelion workers near a trench for geothermal loops in Garrison, New York.

^For three nights in December 2019, when the temperature in Katonah, New York dropped below 20 degrees, Subbaiah Maneyapanda and his wife lugged space heaters and a second mattress into their bedroom for their two daughters, 10 and 7, while cuddling their 2-year-old son in their own bed. Nine months earlier, Maneyapanda had signed a contract with Dandelion Energy, a spinoff of Google-parent Alphabet, for a geothermal system that uses the temperature of the earth at least 300 feet below ground to heat and cool homes. Dandelion installed one of its units in the summer and said work for the second floor would be finished in the early fall. Expecting the system would be ready, Maneyapanda didn’t pay for another delivery of heating oil. But by December, the work still wasn’t done, and the heat was off. “It was quite a bit of pain for us,” he says. 

Maneyapanda is one of 20 customers in New York who told Forbes about problems during the installation or maintenance of Dandelion’s geothermal units, including extended timelines, surprise costs, unexpected damages and results that left parts of their homes cold or noisy. Though the company offered to pay for a hotel for Maneyapanda’s family as it completed the job, they decided it was less disruptive to just bundle in. “We’d been waiting for months already,” he says. “Dandelion needs to get their act together.”

When the New York City-based startup spun out of Alphabet technology incubator X in 2017, it was considered one of the clean energy vanguard, positioned to apply the innovation and scale of its parent to a physical challenge: using geothermal energy to heat and cool homes. Silicon Valley investors including New Enterprise Associates, Alphabet venture fund GV, and Comcast Ventures backed its promise of bringing its fossil fuel-free technology into millions of houses, for half the cost of traditional geothermal. The company raised $35 million, including $12 million in January at a $110 million valuation.

In the nearly three years since Dandelion left Alphabet’s fold, however, its ambitions have hit significant roadblocks. While many of the nearly two dozen customers who spoke to Forbes said they were happy once their systems were running, nearly all describe an installation process plagued with problems, ranging from the annoying (never knowing when a subcontractor would show up in one’s yard) to the severe, such as drilling that left foundations cracked. Some were shocked when the price ended up thousands of dollars higher than Dandelion initially quoted, while others felt sales reps glossed over the havoc to their yards. In two of the most egregious cases, customers have hired lawyers to advise them as they fight their claims.  

“As a former Googler myself, I was excited to see an X spinout piloted in my neighborhood,” says Joe Rosenberg, a Dandelion customer in Waccabuc, New York. Not anymore. Rosenberg, a manager at Google for nearly eight years until 2018, says he had to fight Dandelion to avoid paying $10,000 more than the price in his contract for additional work. What’s more, he claims that his system, installed in August, still isn’t working properly, leaving some rooms chilly and his daughter’s so noisy that she’s having trouble sleeping. He’s refused to complete his payment to Dandelion until it commits to fixing his problems, including $22,000 in damages to landscaping and his home.  Dandelion, in turn, has put a lien on his house. 

Dandelion declined to comment on Rosenberg’s case or that of any other specific customer, but says it takes responsibility whenever they aren’t satisfied and tries “to make it right.” Cofounder Kathy Hannun insists most of its 350 customers are happy with its work (70% of 91 Dandelion projects surveyed by New York’s energy research agency over 13 months received its highest rating), but concedes the company has had to make changes.

“These homeowners are early adopters: what we’ve learned from them has made it possible for us to scale this business as quickly as we are—we’ve grown 5x [in revenue] year-over-year,” says Hannun. “It doesn’t fully solve their experience, but that’s what I would offer them.”  

Hannun, who gave up the CEO role in January to focus on product development as the company’s president, started her career at Google. In 2010, a year after she graduated from Stanford University with a degree in civil engineering, Hannun joined X, the company’s secretive, then newly-launched technology incubator that would develop futuristic projects like self-driving cars and balloons to connect remote villages to the Internet. She worked her way up to become a project manager who pushed forward the most promising new ideas, and in 2014, she spearheaded an effort to make fuel out of seawater. After Google shut that down, she teamed up with staffers James Quazi and Bob Wyman (who is currently running for Congress in New York) on another green initiative: geothermal heating. 

While humans have been using energy from the earth to warm their baths since the Stone Age, the modern methods for harnessing the “heat beneath your feet” only emerged in the last century. The system involves installing U-shaped pipes hundreds of feet below ground to tap into the static 50 degree to 60 degree temperature of the earth. These pipes are filled with liquid and connected to a washing machine-sized air pump inside the house. They absorb warmth from the ground in the winter, which the pump pushes through the house. In the summer, the pipes disperse heat from the home back into the ground. The technology has taken off in nations that have had oil shortages or mandates to cut down on carbon emissions, like Sweden, where about 20% of buildings use some form of ground-source heat pump.

In the United States, geothermal heating has been a fringe option, embraced by green-minded homeowners who can swallow the high price-tag. Hannun and her team aimed to change all that. They’d introduce their own technology — a custom drill for installing the ground loops and its own heat pump — that would complete the work faster, with less mess, for a lower cost. Dandelion would charge between $20,000 and $25,000 upfront, or what it claimed was about half the price of traditional installers, and offer financing that would let customers pay over 20 years.

After two years tinkering within X, Dandelion spun out as an independent company in May 2017, then raised $2 million in seed funding that July. Though it hadn’t completed its drill and pump technology, the company generated plenty of press fanfare and began targeting customers in New York state, where many residents rely on oil or natural gas. 

“They’re taking out the upfront angst,” says Daniel Kammen, an energy professor at the University of California, Berkeley who is familiar with Dandelion’s pitch. “It’s this nexus of information technology and energy technology.”  

Dandelion completed its first project for a pair of environmental activists in Canaan, New York in September 2017, acting as the financier while subcontracting with a local geothermal business to handle the job. It started rapidly signing up customers, making deals with more local installers to complete the work. The timing was fortunate: federal tax incentives had started to provide thousands of dollars of green energy discounts.

As its number of contracts swelled through New York’s Hudson Valley and beyond, however, customers were complaining of botched and prolonged installations. With so many subcontractors, scheduling was a mess. 

‘Unlike with software, you can’t simply push an update to fix bugs from a beta release’

“The customer wait times were longer than we wanted,” Hannun admits. “We didn’t have direct control over every part of the customer experience, and we were slower to learn—our insights about the process were a step removed.” By July 2018, the company decided it needed to build up its internal field teams. 

That meant Dandelion had to buy equipment, get county licenses, and hire and train people to install geothermal systems. Change has been slow. Of the Dandelion customers who spoke to Forbes, fifteen said that they’ve faced delayed schedules, installation errors, unexpected costs or product breakdowns within the last year. 

“I made the mistake of thinking they were more organized and better than they were,” says Paul Kuszynski, a Dandelion customer in South Salem, New York.

In the fall, as Dandelion was drilling to install its pipes and digging a trench to connect his house, workers hit his septic drain field, despite warnings to avoid it, he says. Then they took out a communication line, cutting off phone and internet service in the neighborhood. “I am truly disappointed in how this all transpired,” Kuszynski emailed Hannun in November, “and the amount of work as a customer I had to do to get to the truth of the issues that arose.”  Once the project finished, he got another surprise: a January electric bill four times higher than usual. Dandelion chief technology officer Quazi came to his house to adjust the system, Kuszynski says. The company now warns its system can cause electric costs to quadruple in the winter; it previously just compared the extra electricity usage to a refrigerator. 

“There have been customers where the expectations were not set right,” says Keith Bell, owner of Bell Heating & Air Conditioning in Mahopac, New York. He has installed geothermal heat pumps in more than 250 homes, including more than 50 jobs for Dandelion. 

Such was the case with Oscar Cabral in Brewster, New York. “It’s been a headache,” he says. Rescheduling and delays dragged his project’s end date from November 2019 into the new year. Then the sticker shock. Dandelion added thousands of dollars in unexpected costs, he says, and tried to charge him extra for work that he believed was covered in his contract. Another gripe: when his foundation cracked during the drilling, Dandelion said it wasn’t at fault. In February, his system didn’t pass a regional inspection. “Overall, it’s been a terrible experience,” he says. “I wouldn’t recommend Dandelion to anyone.”  

To some, Dandelion was proving that Silicon Valley’s coder ethos—experiment, release, fix, repeat—can run into trouble in the physical world. Google learned this lesson with projects like Fiber. In 2016 it slashed the scope of the vaunted high-speed internet business after the time and cost of tearing up streets to lay cable proved too steep. Earlier this year, it shut down Makani, a moonshot effort to make giant kites to harness wind energy. “Unlike with software, you can’t simply push an update to fix bugs from a beta release,” says former Google employee Rosenberg of his troubled installation. He blames Dandelion’s issues, in part, on a “venture-backed push for rapid scale.”

That venture money gives it more time to get it right. Dandelion’s new CEO Michael Sachse, who joined the company in January after working in enterprise software, predicts the company has 18 months of runway thanks to its new funding round. “We have been working to define the job that Dandelion is best suited to serve, and then define the processes that allow us to serve that job reliably and predictably,” he says. 

It’s had to downgrade its sales pitch as it works through those kinks and the technology that was supposed to lower costs. It only launched its custom drill last summer, still only using it for certain jobs, and sometimes installs a Bosch system instead of its own heat pump. As for costs, in 2017, Dandelion advertised its system would cost half of what other installers charge. Now, Sachse says the cost is two-thirds. Interviews with New York competitors show that even that could be an exaggeration; five listed prices in line with Dandelion’s. 

For now, this Google moonshot’s ideal customer may still be someone that cares more about the goal of reducing their carbon footprint than the process required to get there. In other words, people like Tim Owens, a self-described “crunchy granola” customer in Niskayuna, New York. He loves his Dandelion system, but credits his longtime interest in geothermal for helping him remain calm during his installation between September 2018 and July 2019.

“When they came in and things got screwed up, I was patient,” he says.“I didn’t yell and scream, I said, ‘C’mon, let’s get this working.’ Because ultimately their success is everyone’s success.”

Cover Photograph Andrea Mohin/ New York Times.

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