Sacramento Municipal Utility District (SMUD), the publicly-owned utility in California’s capital metropolis, has modified its vitality effectivity metric from prevented electrical energy consumption to prevented CO2 emissions. 

SMUD is the primary utility within the nation to depend prevented carbon emissions from the present constructing inventory as a part of its progress on vitality effectivity. This makes constructing electrification central to SMUD’s vitality effectivity efforts.

The change to “prevented carbon” is a part of SMUD’s formidable effort to speed up decarbonization of its present constructing inventory.

Measuring vitality effectivity by way of prevented CO2 emissions may very well be an efficient approach to incentivize utilities with decarbonization targets to undertake constructing electrification, offered that these utilities are additionally greening their energy provide, in keeping with a brand new Wooden Mackenzie case research targeted on the hassle.

A holistic imaginative and prescient

Constructing electrification is a core part of SMUD’s technique to achieve carbon neutrality by 2040. SMUD expects 80 % of buildings in its space to be all-electric by 2040, up from 17 % right this moment.

To show the worth of constructing electrification for local weather, SMUD developed a software to calculate the financial savings by way of prevented CO2 emissions from switching to electrical energy over the lifetime of an equipment, taking the evolving carbon depth of the grid under consideration. Prevented carbon is a perform of how inexperienced the grid is for a particular location and of electrical energy’s time of use.

Not like vitality effectivity packages that measure success in kilowatt-hours prevented, by folding constructing electrification into its vitality effectivity efforts the utility is advancing vitality effectivity whereas rising electrical energy gross sales.

SMUD has already begun an enormous effort to broaden penetration of electrical area and water warmth pumps, induction cooktops, and charging stations for electrical autos, in its service territory.

The utility’s newest Built-in Useful resource Plan (IRP), which SMUD adopted in 2018 and the California Power Fee (CEC) authorized in January 2020, included quite a few incentives for electrical retrofits and all-electric new buildings to permit SMUD to fulfill its net-zero electrical energy goal.

New state-level constructing requirements may also be required to make sure this objective is reached, the IRP notes.

Sacramento’s warmth pump decade

WoodMac’s case research highlights warmth pumps as a key know-how for SMUD’s and different utilities’ decarbonization efforts, since dwelling heating is a significant supply of emissions from pure gasoline. Warmth pumps additionally convey the additional advantage of accelerating the effectivity of cooling, along with decarbonizing heating.

SMUD’s IRP estimates that over 85 % of present residential and 75 % of economic area and water heating will have to be transformed from gasoline as a principal gas supply to electrical energy. 

Even when counting on pure gas-fired crops for energy provide, warmth pumps’ excessive price of fuel-to-heat conversion (referred to as coefficient of efficiency) makes electrical warmth much less carbon-intensive than gasoline heating. The height carbon depth of SMUD’s grid right this moment is already beneath that of an all-gas era fleet, and it’s anticipated to fall additional over the subsequent few a long time because the utility provides renewables and demand-side assets to its grid.

The lower in carbon depth of SMUD’s grid and extra warmth pump installations will see a continued improve in CO2 financial savings.

WoodMac’s analysts additionally be aware that monetary incentives for putting in warmth pumps are obligatory to advertise constructing electrification, as warmth pumps nonetheless can’t compete with pure gas-fueled home equipment in financial phrases alone, attributable to low pure gasoline costs within the U.S.

To this finish, SMUD provides residential warmth pump water heater rebates as much as $2,500, in addition to incentives to retrofit business buildings.

The scale of the rebate is a key differentiator for SMUD. Its warmth pump water heater rebates are considerably greater than California’s different investor-owned utilities.

New buildings, new coverage battles

The prevailing constructing inventory isn’t the entire story, nevertheless. SMUD’s carbon-neutrality timeline assumes that almost all of recent buildings in California will probably be required to be all-electric.

For brand spanking new buildings, rebates, restrictions on new pure gasoline hookups, and all-electric constructing codes are the important thing insurance policies at play across the nation.

As of Q3 2020, 33 municipalities in California have launched constructing codes that require or encourage all-electric development. In the meantime, the subsequent replace to California’s Title 24 constructing requirements may mandate all new buildings statewide to be all-electric from 2023. PG&E, a utility that gives each electrical energy and gasoline, has indicated its assist for the brand new codes.

Different gasoline distributors have proven much less enthusiasm for California’s electrification insurance policies. In July 2020 Southern California Fuel sued the CEC earlier than the California Superior Court docket for the County of Orange, alleging the Fee failed to supply a key report that the utility is used to seeing, which might element the CEC’s technique for benefiting from pure gasoline assets.

The tensions about electrification insurance policies will be felt exterior of California as properly. States like Arizona, Oklahoma, and Tennessee have already preemptively adopted laws stopping native governments from introducing ban on new pure gasoline hookups. As insurance policies that encourage electrification and all-electric development have gotten extra widespread nationally, gasoline utilities are utilizing this chance to foyer and battle again.


Fei Wang and Francesco Menonna are the authors of the Wooden Mackenzie perception ‘SMUD’s constructing electrification technique: A grid edge case research’

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