Published on February 12th, 2019 | by Tina Casey0
Fossil Fuel To Electricity Conversion Field Suddenly Blows Up (#CleanTechnica Exclusive Interview)
February 12th, 2019 by Tina Casey
Wow, that was fast. Just last fall, CleanTechnica took note of a new campaign to switch buildings out of fossil fuel and into electricity, and all of a sudden things are blowing up all over the place. The latest two developments involve two heavy-hitting states in the renewable energy field, California and Massachusetts.
Um, Why Electrify Buildings?
Okay, so the building electrification field is not quite as flush-in-your-cheeks exciting as the latest news out of Tesla, but it rates an 11 out of 10 on the sustain-o-meter.
Here in the US, residential and commercial buildings account for about 40% of total energy consumption. By comparison, the transportation sector accounts for 30%. In other words, even if you Musk-ify every car, truck, train, plane and boat in the US, you still get more bang for your buck tackling the challenge of energy use in buildings.
During the Obama administration the focus was mainly on energy efficiency, and the main portal for action was the Energy Department’s Better Buildings initiative. That portal is still very active (a tutorial on energy assessment for data centers is slated for February 19).
Fossil Fuel And Building Electrification
Now that more renewable energy is entering the electric grid, the focus is turning to weaning buildings from depending on fossil fuel — mainly natural gas and oil — for heating, cooling, and cooking.
For obvious reasons, though, the Energy Department is handling the issue of electric conversion with kid gloves. After all, who wants to annoy oil and gas stakeholders? That includes overseas fossil fuel stakeholders that export to the US, as well as domestic companies.
Nonprofit organizations are under no such restrictions, which explains by the Rocky Mountain Institute took the lead last year, with a newly launched campaign aimed at incentivizing building owners to convert from gas and oil to electricity.
Converting From Fossil Fuel Too Electricity: It’s Complicated
Last fall CleanTechnica interviewed RMI’s electrification campaign director, Bruce Nilles, who observed that current rate structures work against electricity conversion.
Nilles’s experience converting from fossil fuel to electricity in his own home bears that out. The problem began at the beginning, as he searched in vain for a contractor who would take on the job. For the most part, contractors tried to solve his problem by encouraging him to buy more efficient appliances.
When he finally found a contractor, the verdict was a pain in the wallet. Over and above the cost of new appliances, he was looking at three different permit applications that added up to $925.00.
That helped provide Nilles with a firm grasp on the challenges ahead.
“About a year ago I realized that in California, gas consumption in buildings is as much as gas consumption in power plants,” he explained. “We now have a trajectory to get gas out of our power sector, but there is no such ambition, conversation or suite of programs to do same for buildings…the conversation is only happening in a few small pockets now.”
Electrification Suddenly Blows Up
Before coming to RMI, Nilles’s track record included the Sierra Club’s successful Beyond Coal campaign, so he also had a good grasp on the potential for a successful campaign to exorcise fossil fuel from buildings.
Sure enough, things are already picking up steam.
In the latest development, the Massachusetts Department of Public Utilities just unveiled a new package of incentives for homeowners to give up their oil and gas furnaces in favor of electric heat pumps.
The incentives come under the state’s Mass Save program as part of the its new Three‑Year Energy Efficiency Plan for electric and gas distribution companies. Overall, the plan is expected to save customers $8 billion over three years while cutting greenhouse gas emissions.
Here’s the money quote:
The plan shifts electric programs to recognize the benefits of strategic electrification, and for the first time in Massachusetts offers incentive programs for fuel switching – targeting oil and propane customers for fuel conversion to more efficient and affordable heating fuels and technologies such as air source heat pumps.
New incentives for Passive House construction are also part of the deal. Basically, that means that the state is teasing the state’s building industry over to avoid gas and oil appliances in new construction.
The three-year plan is consistent with the state’s broader Comprehensive Energy Plan, which includes energy used for heating among its main focuses:
…Many aspects of this energy efficiency plan were included in the CEP recommendations which included policy strategies to target reductions in thermal sector consumption, drive consumer demand for energy efficiency measures, promote fuel switching from expensive, higher carbon intensive fuels to lower cost, lower carbon fuels, and invest in research and development for clean heating fuels.
Fossil Fuel And California: It’s Complicated
In political terms, it helps that Massachusetts has little in the way of a homegrown lobby for oil and gas, at least not in the extraction part of the supply chain.
The situation is different in California, where the fossil fuel sector still wields some degree of political clout.
Nevertheless, state policy makers are continuing to press for an electrification initiative. To keep the pressure up, something called the Building Decarbonization Initiative has just released a fossil fuel conversion roadmap.
The new “Roadmap to Decarbonize California’s Buildings” calls for adopting zero-emission building codes for residential and commercial buildings by 2025 and 2027, respectively. Naturally that means zero-emission appliances have a big role to play.
Adding to the intrigue, a new California building code requires all new homes to be built with on-site renewable energy, and the state is also implementing new incentives to encourage heat pumps over gas appliances.
BDI notes that builders can also benefit from reduced costs:
…the alternatives are here and at cost with natural gas appliances. In fact, by avoiding gas infrastructure to and in a building we are finding that all-electric construction can be cheaper than buildings with gas.
That provides an opening for rolling fair housing and economic justice into fossil fuel conversion. Stephanie Wang of the California Housing Partnership explains:
This policy roadmap highlights a key best practice for addressing the housing crisis – empower affordable housing developers to tap the full range of innovative low-carbon technologies so they can choose the options with the lowest upfront costs and greatest bill savings for residents.
And of course, job creation factors in. BDI cites Chris Walker of the California Association of Sheet Metal and Air Conditioning Contractors, who notes that retrofitting “hundreds of thousand of buildings” is “actually a huge economic and workforce opportunity.”
If fossil fuel conversion is a gunfight, BDI is bringing a howitzer. In addition to environmental non-profits its member roster is packed with leading cities (California, Palo Alto, San Jose), utility companies, and appliance manufactures (Rheem, Mitsubishi) among other heavy hitters like the global real estate powerhouse Cushman & Wakefield.
CleanTechnica is reaching out Cushman for some insights from the real estate perspective, so stay tuned for more on that.
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