Maine must plug in to fight climate change, study concludes

To get the carbon out, Mainers will need to plug in.

There’s wide agreement emerging that just building renewable generation and stepping up energy efficiency won’t slash greenhouse gas emissions enough to meet the aggressive climate change goals being set by Maine and other Northeast states.

To do that, Maine residents will have to electrify their heating and transportation systems, with the focus on three existing and evolving technologies: cold weather heat pumps, heat pump water heaters and electric vehicles. Maine could increase the adoption of those technologies by promoting their advantages and boosting financial incentives.

That’s the conclusion of a report that is scheduled to be presented to the Legislature’s energy committee next week, a follow-up to a bill lawmakers passed last year aimed at electrifying transportation and heating in Maine. They asked Efficiency Maine to study the barriers to making that happen and draw up what amounts to a primer for policy makers on what it would take to electrify Maine at home and on the road.

“The biggest takeaway is, there’s new technology that will provide the heat and transportation we need for a prosperous Maine economy, and it comes from electricity,” said Michael Stoddard, Efficiency Maine’s executive director.

That idea may take time to sink in. Electricity is better for the environment than fossil fuels because it comes increasingly from clean, renewable power sources, but systems that convert electric current into heat remain the most expensive option to warm a building. Six out of 10 Maine homes are still warmed primarily by heating oil. And nearly 100 percent of vehicles on the road are gasoline-powered, led by pickup trucks and SUVs.

But change is happening, especially at home. Mainers are coming to embrace the latest generation of so-called mini-split heat pumps, which are among the cheapest ways to heat, even in frigid temperatures. More than 45,000 have been installed in the past five years. Efficiency Maine is doubling initial rebates to $1,000 in an effort to reach 100,000 installations by 2025.

“It’s going to take a fair amount of getting used to, but there are no more powerful messengers than friends and neighbors,” Stoddard said. “We’ve seen that as a major source of information driving the success of high-performance heat pumps.”

Central to Efficiency Maine’s report is what’s called beneficial electrification. That term is now defined in law to mean using electricity for a technology that cuts fossil fuel use, while benefiting consumers, utilities or the environment.

Not surprisingly, those aspirations can be at odds. So as beneficial electrification becomes a new buzz phrase in energy circles, Maine lawmakers will be challenged to decide where to find the billions of dollars it would cost to implement the technologies and determine who would pay to help speed the transition on a grand scale.

Underlying the push to electrification is a law championed last year by Gov. Janet Mills that aims to cut Maine’s greenhouse gas emissions 45 percent by 2030, and 80 percent by 2050. That would require a full transition to renewable generation – including solar, wind and hydro – by 2050.

The law also established the Maine Climate Council, which is charged with developing action plans to hit those targets.

But there’s an immediate bump in the road to meeting those greenhouse gas goals through electrification.

FOSSIL FUELS RULE THE ROAD

An estimated 90 percent of carbon dioxide emissions in Maine stem from burning petroleum products, and more than half of that comes from cars and trucks. And as of last year, less than 1 percent of the 1.3 million vehicles registered in Maine were all-electric vehicles, or EVs.

There are many reasons. Even with government incentives, EVs cost more than comparable gas-powered cars. Drivers have lingering concerns about running out of battery charge, so-called range anxiety. Then there’s the lack of charging stations and, at least for now, low gasoline prices.

And despite publicity about manufacturers ramping up EV production, the report cautions that consumer awareness and interest remains very low.

“The majority of consumers still have minimal understanding and several misconceptions about the capabilities, advantages and general operations of EVs,” the report states. “Seventy-five percent of consumers know little or nothing at all about EVs. Consequently, most people do not consider EVs when making a vehicle purchase.”

So at the moment, the leading source of carbon emissions seems to be the hardest to electrify.

The report suggests some solutions.

Battery prices are falling, and more charging stations are being built. Maine now has a $2,000 tax credit for EVs, though at the same time, a federal incentive worth up to $7,500 is being phased out.

“Usually, the bigger the problem, the more attention you need to pay to get to solutions,” said Jeff Marks, Maine director at the Acadia Center, a regional group working on climate change issues. “And transportation is it.”

the Acadia Center supports the Transportation and Climate Initiative, a collaboration of states from Maine to Virginia working to reduce carbon emissions on the road. But part of that effort envisions raising money through a surcharge on gasoline and diesel fuel, with some of it going to EV rebates and new charging stations. That’s a non-starter for opponents such as the Maine Heritage Policy Center, which said the tax would hurt low-income residents.

Marks said similar arguments were made against the Regional Greenhouse Gas Initiative, the multistate program that raises money by offsetting power plant emissions. RGGI, as it’s known, has raised millions of dollars to help Mainers pay for conservation and efficiency.

“It’s a political challenge anytime you talk about fees,” he said. “But we need to help the conversation along by saying this is an investment we need.”

HEAT PUMPS A GOOD START

Electrification may be an easier sell at home, even if Maine’s residential sector is responsible for only 20 percent of greenhouse gas emissions.

While a new electric car may cost $30,000, a typical heat pump is less than $5,000. A properly installed and operated heat pump can save a homeowner $300 to $600 a year compared with oil or propane, according to Efficiency Maine. Heat pumps are the foundation of the state’s efforts to shift home heating from fossil fuels to electricity.

But there are still “significant misconceptions” about heat pumps, the report says, even though the best ones work down to minus 15 degrees Fahrenheit.

“Nevertheless, many heating technicians and homeowners are under the mistaken belief that it is better to turn off heat pumps in the winter months (relying entirely on their central fossil fuel-fired systems),” the report says. ” In past years, this message was conveyed by fuel dealers across the state.”

A big share of the money that now pays for heat pump rebates comes from a small surcharge on electric bills. To increase funding, clean-energy groups want lawmakers to consider a fee on oil and propane. The Acadia Center estimates that raising $8 million a year would generate enough money for $3,000 rebates to help insulate 2,700 homes.

That idea has been raised in the past, and has been killed following strong opposition from fuel dealers. Viewed more broadly, electrification could make homes more vulnerable, according to the Maine Energy Marketers Association, which represents many petroleum dealers.

“Depending entirely on electricity to power Maine’s homes and transportation could make the grid a single point of failure in a storm,” the trade group said in early comments about the effort.

Lastly, heat pump water heaters are a new technology that’s considered the cheapest way to warm water in a home. But they are more expensive than conventional models and aren’t suitable for all locations. The report also notes that most people don’t replace a water heater until their existing one fails, and then it’s an emergency. The tendency is to install the same kind of heater that was there before.

Upgrading heating systems, replacing water heaters, buying a new car – each is a personal decision that happens infrequently. To speed up electrification that benefits Maine residents, policymakers will need to consider which technologies need a boost at those key decision times.

“This transition will take several decades,” Stoddard said. “The marketplace is starting to move in that direction with heat pumps and water heaters. Electric vehicles will follow a similar path, but it will take longer.”