Policy Solutions


Powering Clean Buildings

A primary source of building sector emissions is the combustion of fossil fuels to create heat and to fuel appliances like stoves. Roughly 50 percent of households in the United States are heated using natural gas and propane, a significant portion of which relies on aging infrastructure.

Air-source heat pumps offer an alternative to existing fossil sources for space and water heating and cooling. Likewise, electrified appliances like induction cooktops offer alternatives to fossil-fired stoves. When powered by clean electricity, building electrification will further accelerate the path to net-zero emissions.

Market Challenges

  1. Consumer Inertia and Capital Constraints

    Much of America's consumer base has grown accustomed to using natural gas or other fossil fuel-based appliances. Limited awareness of the health and safety risks of gas, the methane leakage and carbon impacts of natural gas, electric alternatives, misperceptions of electrification, consumer preferences, and product experiences all serve to slow the necessary shift away from fossil fuels. Furthermore, the economic benefits of building electrification are not immediate. Building electrification is usually cost-effective over an asset’s lifetime, but high upfront capital costs and split incentives between tenants and building owners often prevent heat pump deployment. Even if electrifying makes economic sense, consumers can face long payback periods for these devices while gas remains cheap, significantly impacting adoption, especially in low-income areas.

  2. Supply-Side Limitations

    Electrification efforts can be thwarted by the respective interests of incumbent utilities, contractors, vendors and other supply-side actors. Even without technical challenges or performance issues, contractors at the back end of the technology adoption curve are often less equipped to sell electrification effectively and tend not to promote it. Utilities that supply natural gas often oppose electrification because it can negatively impact their business models. There is a limited number of contractors offering, servicing, or interested in new electric equipment and those who do often advise customers to implement incumbent, fossil-reliant options.

  3. Existing Infrastructure and Stock Turnover

    Most of the existing building stock and electric distribution infrastructure was not built with the intention of complete electrification, presenting a critical barrier to faster progress. Increases in peak demand and insufficient demand-side management could require costly upgrades to our power system on a local and regional scale. In addition, gas appliances and distribution infrastructure are already in place and provide easy and cheap access to gas for many customers. At the building level, architectural challenges can hinder fuel-switching retrofits (e.g. buildings may lack appropriately sized and ventilated space for heat pump water heaters) and the replacement rate of combustion devices is slow (with 15-20 years of useful life).

Technology Innovation Examples

Phases of Technology
Research and Development
Validation and Early Deployment
Large Scale Deployment

Heat pumps use electricity and have various applications including space heating and cooling, water heating, and clothes dryers. The broad categories of heat pumps—air-source, water-source, and ground-source—each use these respective materials as a heat source or sink. Grid-interactive heat pumps can shift the timing of demand based on grid signals (pricing, carbon, etc.)

Due to significant technological advances over the last decade and contrary to popular belief, many heat pumps today can function cost-effectively even in the coldest climates. Heat pumps are also reversible: one piece of equipment can provide both heating and cooling services. These systems can be designed for all building types, from single family homes to large commercial buildings. Barriers to further adoption include awareness, relatively higher up-front capital costs (which could be mitigated by new financing approaches), and, for geothermal heat pumps, wider availability of drilling.

Electrified Space/Water Heating
Air-source heat pumps use electricity to provide space heating and cooling by using the outside air as a heat source or sink, respectively.

Nearly all U.S. cooktops are traditional natural-gas or electric models. A growing alternative technology, the induction stove, presents opportunities for electrification and efficiency improvements. Induction stoves use electricity to generate a magnetic field. Once a pot or pan is set on the burner, the magnetic field induces many smaller currents in the cookware’s metal. Cast iron and stainless steel are poor conductors of electricity; as a result, much of the energy from the current running through them is converted into heat.

The heat coming from the pan itself rather than the burner makes for a more efficient cooking process. Induction stoves can offer a cooking experience that rivals gas cooking, including faster times and a high degree of control and simmering. Two principal barriers to the wider adoption of induction stoves in the U.S. are their high upfront cost and the perception among many consumers that gas stoves provide the best cooking experience. Broader deployment of induction stoves will therefore rely on cost reductions to make them more competitive and awareness efforts to drive greater adoption.

Electrified Appliances
Induction stoves use electricity to generate a magnetic field, inducing many smaller currents in iron and stainless steel cookware and converting the energy from those currents into heat.

District heating and cooling involves distributing hot and cool water or steam through a system of pipes to provide space heating, space cooling, and domestic hot water to multiple buildings. A district-scale system allows for heat recovery, which means that heat is let into, and extracted from, the system in different places. Moving heat around to where it is needed, rather than wasting it at different points, makes these systems highly efficient.

The U.S. market has two major needs for ready-to-deploy district solutions: 1) converting existing district systems (typically steam-based) to zero emissions and 2) building new district systems with greater efficiency than single-user systems. Retrofitting existing systems is particularly important: they are often over 50 years old, powered by coal or natural gas, and generally provide only heating, not cooling. Many are now being updated, creating a significant opportunity for innovative retrofits that use renewable energy and improve efficiency.

Generally, individual district-scale applications require a great deal of engineering customization. Easier-to-deploy, integrated solutions are needed to standardize district-scale configurations of commercially available clean technologies (e.g. geothermal heat pumps, solar thermal). Improving legal structures and access to capital are also critical to that end.

District-Scale Heating and Cooling
District heating and cooling, such as the solar district heating system depicted here, provides an efficient method to heat/cool multiple buildings by distributing hot/cool water or steam through a connected system of pipes.

Electrification Policy Recommendations