New Electric Home Study Is Biased, But It Does Show California Wants Clean Energy

Originally published on NRDC.
By Merrian Borgeson

New analysis released this week by the California Building Industry Association (CBIA) seriously misrepresents the opportunity for affordable electric appliances to help reduce air pollution and climate-warming pollution from California’s buildings. However, the study’s findings also reveal a need for new policy and the deep commitment of Californians to clean and renewable sources of energy.

Cleaner Heating Technologies Are Needed

Building-related pollution is responsible for 25% of the state’s carbon emissions — on par with the industrial sector, and just behind transportation as California’s leading sources of dangerous climate pollution that fuels wildfires and heat waves. This includes the use of both electricity and natural gas. According to Air Resource Board data, direct emissions from fossil fuel use in buildings (largely from natural gas burned in furnaces and water heaters) are equal to emissions from most of California’s fleet of natural gas power plants.

As our electricity supply gets cleaner thanks to such resources as pollution-free wind and solar, emissions from fossil fuels burnt in buildings will become one of the top barriers to achieving California’s climate and clean air goals. The good news is that we have a range of solutions currently available, including appliances powered by clean electricity, solar thermal, renewable gas, and energy efficiency. Unfortunately, the report touts misleading information about the cost and performance of an important solution — super-efficient electric heat pumps that can be used for heating space and water.

Topline “Results” Are Misleading

The report’s topline findings supposedly show that electric options for water heating, space heating, cooking, and clothes drying are significantly more expensive than natural gas appliances. But in fact, the analysis shows that electric appliances today are already cheaper than gas models in three out of four categories — a finding not highlighted in the summary of results.

The one more expensive appliance identified is a heat pump hot water heater, where the costs assumed are not supported by any credible data. The study prices the water heater at $4,529 (equipment and installation, not including any electrical work required) based on “SoCalGas data.” In an online search, I could not find a similar model as expensive or as inefficient as the one used in this analysis.

The most comparable model I found was a Rheem 50-gallon tank with three times the efficiency of a standard water heater priced at $1,199 from Home Depot. I polled several utilities, contractors, and energy efficiency program implementers in California and the Pacific Northwest, and the average cost they gave was $2000 to $2600 for equipment, installation, and mark-up. The lower end of this range puts the total costs for all four electric appliances on par with the gas appliances – not massively more expensive as this study purports. Swapping out these appliances alone reduces emissions from buildings by almost 40% (and that is using the electric grid mix for 2020, which will be even cleaner by 2030 given California’s 50% renewable portfolio standard). In addition, heat pump models on the market today are at least 20% more efficient than what was modeled, which would lower a consumer’s monthly energy bill.

A Clear Need for New Policy

Despite the bias of this research, it does offer useful insights. The report highlights the cost of adding electrical infrastructure in older homes built primarily for gas appliances (though the number they use is well above what most electrical upgrades would cost). However, the electrical upgrades that homeowners must undertake to switch are effectively a barrier keeping them tethered to gas – foreclosing those savings and limiting customer choice. These are the same upgrades often needed to charge an electric car at home.

These infrastructure costs can largely be avoided if built into newer buildings – highlighting the important role of policy in encouraging builders to make sure homes are ready for electric appliances and vehicles. This would mean building homes with sufficient electric panel size (already the norm in most new homes) and the right wiring, so that a range of technologies can be plug and play, instead of requiring expensive retrofits. To be clear – this does not mean requiring the use of electricity – but genuinely giving Californians freedom in the appliances and vehicles they choose.

Californians Want Clean and Renewable Energy

Another powerful finding from this research is that Californians care deeply about access to clean energy. The electrification analysis was paired with a survey of California voters. This survey shows that voters both place a priority on energy that is “clean and renewable” (49%) and energy that is “affordable and reliable” (43%).  And by a margin of 3 to 1 respondents say that renewable energy or reducing emissions should be the state’s top energy priority, compared to lowering energy bills.

The good news is we don’t have to choose between clean and affordable energy; California leads the nation in electricity generated from renewable sources and we still pay far lower electric bills than the national average. But we do have to develop the policies needed to significantly reduce emissions from buildings and to develop the market for technologies that will help get us there, including super-efficient water heaters that run on clean electricity.

Reprinted with permission.