Beneficial Electrification Sparks a Confluence of Decarbonization Opportunities and Challenges
A regional decarbonization strategy should call for comprehensive innovation across the many systems that sustain society, but the number of pathways can present challenges for policymakers working to advance scalable policy change. Electrification provides a strategy for decarbonization that relies on the intersection of energy systems with businesses, governments, institutions, and society. Although electrification obstacles persist in sectors such as agriculture and industry, the transportation and building sectors exemplify how and why electrification can be beneficial in the pursuit of multi-sector, equity-centered decarbonization.
Local governments, schools and businesses in Pennsylvania are starting to receive meaningful support to chart their electric vehicle futures, and the state has submitted its electric vehicle infrastructure plans which includes over 2,000 miles worth of electric vehicle charging corridors. Meanwhile, semiconductor manufacturers, battery manufacturers, and links in the solar supply chain are investing in Pennsylvania’s emergent beneficial electrification ecosystem.
Electrifying as many end-uses as possible is an important element of a decarbonization strategy. Beneficial electrification must balance feasibility across technology-readiness, cost-effectiveness, lifecycle emission reductions and other criteria specific to the application. According to the American Council for an Energy-Efficient Economy, electrification is beneficial when it achieves three things: decreases energy consumption, lowers consumer costs and reduces emissions. Taking this one step further, the Regulatory Assistance Project considers enhanced management of the grid as a component of beneficial electrification. These definitions, taken together, illustrate the interdependence needed between institutions and individuals for electrification to be beneficial, and for decarbonization to be successful.
Beneficial electrification exemplifies decarbonization’s sweeping intent, and fortunately, this is where policymakers can make meaningful, scalable change. Policies that advance beneficial electrification often amend a state’s energy efficiency resource standard, which offers a platform for utilities to administer beneficial electrification programs. Beneficial Electrification Programs can provide direct rebates designed for energy-burdened households, centering equity in beneficial electrification and improving the health of disadvantaged communities. Pennsylvania’s energy efficiency resource standard, often referred to as Act 129, can be a vehicle to advance these opportunities, but there are serious obstacles to realizing beneficial electrification’s potential.
In an article published from McKinsey’s Sustainability Practice, electrification is an important component of any decarbonization strategy, but it is the single most capital-intensive climate solution available. When combined with renewable power and operational efficiency, beneficial electrification drastically cuts carbon emissions. However, a large majority of the region’s building stock is currently served by natural gas, indicating the need for long-term, sustained support carried out over multiple decades by multiple key stakeholders.
Fortunately, recent federal programs have invigorated conversations on beneficial electrification. The Infrastructure Investment and Jobs Act includes programs for the buildings sector, including the Energy Efficiency and Conservation Block Grant Program which provides local governments with funding for programs that reduce emissions and improve efficiency, two key components of beneficial electrification. For private commercial building owners, the Commercial Building Energy Efficiency Tax Deduction (179D) has been significantly increased with the passage of the Inflation Reduction Act, offering up to $5.00 per square foot for meeting energy efficiency standards. If a building is owned by a nonprofit organization that wants to integrate beneficial electrification into their decarbonization strategy, they can take advantage of the Renew America’s Nonprofits Program, designed for nonprofit building owners to replace combustion appliances, such as water heaters, stoves, furnaces, and dryers, with comparable energy efficient electric systems.
In transportation, the National Electric Vehicle Infrastructure Formula Program will invest in a nationwide network of 500,000 electric vehicle chargers by 2030. With such a massive undertaking, the U.S. Joint Office of Energy and Transportation has been authorized to promote collaboration between the U.S. Department of Energy (DOE) and U.S. Department of Transportation (DOT) to facilitate this large-scale decarbonization effort. The DOE and DOT working together will be critical to the success of many new transportation electrification programs, including the Clean School Bus Grant Program and funding to modernize transit fleets.
For each of the opportunities beneficial electrification offers, it requires an equal investment in up-skilling the workforce and retooling local supply networks so systems are installed by a locally trained workforce that represents the region and are supported by local supply chains. Rewiring America has found that an aggressive national commitment to electrify all aspects of our economy would create up to 25 million jobs over the next 15 years, save households ~$2,000/year, and dramatically reduce carbon emissions, creating ample opportunities for centering equity in our workforce programs and policies.
The beneficial electrification ecosystem requires a commitment to embracing change, to being a learner and to taking action on carbon. The benefits of electrification are dependent on how electricity is generated and used, and the success of decarbonization is dependent on how decarbonization goals are executed and embedded into our region’s vision, now and for the long-term.