Electrification Consortium Investment Prospectus

ELECTRIFICATION CONSORTIUM BACKGROUND: So-called “Beneficial Electrification” refers to the application of electricity to end-uses that would normally consume natural gas or other fossil fuels. Proponents of beneficial electrification are increasingly successful in seeking legislation and regulations that ultimately limit or prohibit the installation of gas appliances and systems by residential, commercial, and industrial customers. Electrification will likely have a significant adverse impact on the cost of energy, consumer energy choice and quality of life. Current and potential users of natural gas appliances and equipment are often at a disadvantage by lacking access to consumer information that accurately evaluates the efficiency and environmental attributes of natural gas appliances. The American Gas Association (AGA), American Public Gas Association (APGA), Air-Conditioning Heating and Refrigeration Institute (AHRI), National Restaurant Association (NRA), and many other groups are recommending that residential, commercial, and industrial users should continue to have the option of selecting gas appliances for a number of reasons such as 1) saving money, 2) reducing greenhouse gasses, 3) improving product quality and/or consumer quality of life, and 4) experiencing increased reliability and resiliency from the natural gas infrastructure. The ultimate goal of electrification proponents is to create an emissions-free power grid. These proponents are recommending that any appliance or technology that consumes gas should be converted to electricity today, with the long-term hope that most or all of that electricity can be provided by non-carbon emitting renewable energy sources in the future. But with 65% of the primary energy used to create electricity being lost during electric generation and distribution, more carbon emissions are often emitted from electric used in homes and businesses today than by consuming natural gas directly by customers. Studies suggest that the current grid would have to at least double in size to be able to meet all the new load that would shift from the use of gas in homes and commercial businesses to electric alone, and the cost to enhance the grid would be passed down to consumers through their electric rates. AGA estimates that policy-driven electrification would increase the average annual residential energy-related costs by $750-$910 based on today’s energy rates. Another challenge to an emissions-free power grid is that wind and solar power are intermittent, thus unable to meet the marginal power loads on the grid. Wind and solar power only produced 20% of the actual nameplate capacity of these power plants from eGRID 2018 data, so new wind or solar power plants would have to be sized significantly larger than existing fossil fuel plants that they would be replacing. In addition, massive electric storage installations would be required to meet both short and long term intermittent loads. All this extra infrastructure in renewable generation and storage is accompanied by significant economic and environmental impacts. OBJECTIVE: To prepare communication and marketing materials that utilities and equipment vendors need to more effectively alert and educate stakeholders, trade allies, regulatory officials, and end users to the limitations of the beneficial electrification effort. CUSTOMER BENEFITS: Natural gas appliances & technologies offer consumers a choice of energy source, lower energy costs, low environmental impact, reliability/resiliency and, improved comfort/convenience. Natural gas should be included as part of a balanced energy solution to reduce carbon emissions. CONSORTIUM FOCUS: Consortia products and materials will embody messaging to educate and influence stakeholders, trade allies, regulatory officials, and end users. Consortium members will decide which type of products and messaging are best suited to their service territories. Potential themes to be incorporated into consortia products include: • Consumer choice of energy sources • The high cost of electrification including appliance conversion cost, electrical upgrades, and costs to improve the electric grid to handle the anticipated higher electric load • Resiliency/redundancy • RNG & hydrogen to reduce carbon content of the natural gas pipeline • Debunking the myths around natural gas for the average consumer: What beneficial electrification really means • Environmental benefits as a result of the direct use of natural gas and source to site emissions • Appliance comparisons including comfort, heat-up / recovery times, lifestyle and preference • Pathways to decarbonize CONSORTIUM PRODUCTS: This consortium will produce multiple print & electronic collateral pieces highlighting the benefits of natural gas use while identifying the drawbacks of electrification. These pieces are primarily for the benefit of individual consortium members to use in their service territories. The consortium will also be a forum for members to share positions, strategies, and other efforts they are undertaking in their respective service territories to ensure that natural gas remains a viable option for residential, commercial, and industrial customers. Proposed deliverables include: • 10 Handouts (one-page, two-pagers or fact sheets) • 8 Videos (Six 30 second videos & two 60 second videos) • 2-4 Infographics • One-time magazine • 6 social media friendly customizable ads • 10 customizable articles • 1-2 customizable PowerPoint presentations • 1-2 Studies • Customer webinars CONSORTIA CHAMPIONS: To be elected from the consortia membership INVESTMENT: The investment in this consortium is $15,000 per member with a target of 8-10 members. This opportunity is open to all ESC utility members. For more information, contact: Eric Burgis, Energy Solutions Center, 400 North Capitol N.W., 4 th Floor, Washington, DC 20001, Phone: 610-796-1946, e-mail: eburgis@escenter.org