Abstract Shallow geothermal systems such as open and closed geothermal heat pump (GHP) systems are considered to be an efficient and renewable energy technology for cooling and heating of buildings and other facilities. The numbers of installed ground source heat pump (GSHP) systems, for example, is continuously increasing worldwide. The objective of the current study is not only to discuss the net energy consumption and greenhouse gas (GHG) emissions or savings by GHP operation, but also to fully examine environmental burdens and benefits related to applications of such shallow geothermal systems by employing a state-of the-art life cycle assessment (LCA). The latter enables us to assess the entire energy flows and resources use for any product or service that is involved in the life cycle of such a technology. The applied life cycle impact assessment methodology (ReCiPe 2008) shows the relative contributions of resources depletion (34%), human health (43%) and ecosystem quality (23%) of such GSHP systems to the overall environmental damage. Climate change, as one impact category among 18 others, contributes 55.4% to the total environmental impacts. The life cycle impact assessment also demonstrates that the supplied electricity for the operation of the heat pump is the primary contributor to the environmental impact of GSHP systems, followed by the heat pump refrigerant, production of the heat pump, transport, heat carrier liquid, borehole and borehole heat exchanger (BHE). GHG emissions related to the use of such GSHP systems are carefully reviewed; an average of 63 t CO 2 equivalent emissions is calculated for a life cycle of 20 years using the Continental European electricity mix with 0.599 kg CO 2 eq/kWh. However, resulting CO 2 eq savings for Europe, which are between −31% and 88% in comparison to conventional heating systems such as oil fired boilers and gas furnaces, largely depend on the primary resource of the supplied electricity for the heat pump, the climatic conditions and the inclusion of passive cooling capabilities. Factors such as degradation of coefficient of performance, as well as total leakage of the heat carrier fluid into the soil and aquifer are also carefully assessed, but show only minor environmental impacts.