The economical viability of horizontal-ground-source systems is compared to air-source systems in South Africa in this work. This study is undertaken because South African manufacturers of air-source systems are considering producing ground-source systems, since the latter systems are gaining more acceptance for environmental reasons. Monthly heating/cooling capacities and coefficients of performance for both systems are determined. Furthermore, it is found that overseas data concerning the optimum depth for the placement of a horizontal water-loop for a ground-source system are not valid for South African conditions, due to climatic differences. Therefore, a techno-economic analysis is conducted to determine the optimum depth. The payback period, net present value and internal rate of return of ground-source systems at various depths are calculated for Pretoria, South Africa. It is concluded that groud-source systems are more viable than air-source systems. It is also observed that the optimum depth for the horizontal water-loop is very shallow compared to recommendations in the literature.