Ceres has released a report on the clean energy transition for the gas distribution industry, which finds the most viable strategies for decarbonizing the industry are currently electrification and efficiency, especially through implementation of heat pumps and deep hybrid electrification.
The gas distribution sector owns and operates systems that deliver energy to homes and businesses for heating, cooling, and other uses, delivering about 15% of energy used in the U.S. and accounting for 14% of emissions.
Since electrification is already available at a higher capacity than low-carbon fuels and is competitive against unabated gas distribution, Ceres has identified it as the best route for meeting the Paris Agreement’s 1.5-degree Celsius goal. Further, electrification presents a “compelling growth opportunity” according to the report, and allows for cost-effective decarbonization for customers.
The Ceres report also promotes the use of heat pumps and deep hybrid electrification. Heat pumps, which allow for zero-emissions heating and cooling, are a viable option for most regions of the U.S. as an alternative to fuel-based systems. Deep hybrid electrification, which combines heat pump technology with existing fuel heating systems, could be implemented in areas with harsher winters in order to increase energy efficiency.
“The industry faces unique challenges,” said the report. “The U.S. gas distribution system plays a key role in meeting the winter space heating demand across a variety of climate zones. In severe winter weather, when heating is needed most and demand can spike dramatically, the peak throughput of gas distribution systems can be multiples greater than the existing capacity of electric grids in many regions. Deep hybrid electrification can have favorable economics for customers and at a system level, while resulting in significant reductions in gas volumes and emissions.”
Renewable natural gas and hydrogen-centric pathways are reportedly not economically viable at the scale needed to reach the 1.5-degree goal, but minor contributions from such fuels may still be beneficial.
Policy Impact on the Future of Gas, Pursuing Synchronized Decarbonization
A shift in U.S. policy is reportedly already occurring, leading to the acceleration of heat pump deployment and building electrification. Ceres suggests investors and utility companies should expect consumers to take advantage of policy-backed incentivization of gas fuel alternatives and should also expect further requirements for emissions reductions.
As electric and gas grids coexist to manage current capacity needs, integrated systems planning and operation is considered a beneficial strategy in the interim.
Ceres noted the potential of “synchronized decarbonization” to take place between transport and heating electrification. In other words, electricity used for both transportation and heating applications may benefit from one another. For example, if transport declines considerably during an extreme winter weather event, the anticipated increased need for heating could be covered. Further, with new vehicle-to-grid electrification technologies, buildings may be powered by stored energy in a vehicle or fleet.
Finally, Ceres promotes building a low-carbon energy system with long-term planning for equity, access, and justice, ensuring that energy costs do not overburden Americans. Electrification costs should come with adequate support for low-to-moderate-income households.