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</div> </div> </div> <div class="row-fluid-wrapper row-depth-1 row-number-2 "> <div class="row-fluid "> <div class="span12 widget-span widget-type-cell page-center content-wrapper" style="" data-widget-type="cell" data-x="0" data-w="12"> <div class="row-fluid-wrapper row-depth-1 row-number-3 "> <div class="row-fluid "> <div class="span8 widget-span widget-type-cell blog-content" style="" data-widget-type="cell" data-x="0" data-w="8"> <div class="row-fluid-wrapper row-depth-1 row-number-4 "> <div class="row-fluid "> <div class="span12 widget-span widget-type-custom_widget " style="" data-widget-type="custom_widget" data-x="0" data-w="12"> <div id="hs_cos_wrapper_module_1523032069834331" class="hs_cos_wrapper hs_cos_wrapper_widget hs_cos_wrapper_type_module widget-type-blog_content" style="" data-hs-cos-general-type="widget" data-hs-cos-type="module"> <div class="blog-section"> <div class="blog-post-wrapper cell-wrapper"> <div class="blog-section"> <div class="blog-post-wrapper cell-wrapper"> <div class="section post-header"> <h1><span id="hs_cos_wrapper_name" class="hs_cos_wrapper hs_cos_wrapper_meta_field hs_cos_wrapper_type_text" style="" data-hs-cos-general-type="meta_field" data-hs-cos-type="text">Top 2024 Trends in Legislative and Regulatory Building Electrification Policy</span></h1> <div id="hubspot-author_data" class="hubspot-editable" data-hubspot-form-id="author_data" data-hubspot-name="Blog Author"> <span class="hs-author-label">Posted by</span> <a class="author-link" href="https://blog.advancedenergyunited.org/author/sarah-steinberg-and-kate-shonk">Sarah Steinberg and Kate Shonk</a> on Sep 4, 2024 12:41:36 PM </div> </div> <span id="hs_cos_wrapper_blog_social_sharing" class="hs_cos_wrapper hs_cos_wrapper_widget hs_cos_wrapper_type_blog_social_sharing" style="" data-hs-cos-general-type="widget" data-hs-cos-type="blog_social_sharing"> <div class="hs-blog-social-share"> <ul class="hs-blog-social-share-list"> <li class="hs-blog-social-share-item hs-blog-social-share-item-twitter">  <a href="https://twitter.com/share" class="twitter-share-button" data-lang="en" data-url="https://blog.advancedenergyunited.org/top-2024-trends-in-legislative-and-regulatory-building-electrification-policy" data-size="medium" data-text="Top 2024 Trends in Legislative and Regulatory Building Electrification Policy">Tweet</a> </li> <li class="hs-blog-social-share-item hs-blog-social-share-item-linkedin">  <script type="IN/Share" data-url="https://blog.advancedenergyunited.org/top-2024-trends-in-legislative-and-regulatory-building-electrification-policy" data-showzero="true" data-counter="right"></script> </li> <li class="hs-blog-social-share-item hs-blog-social-share-item-facebook">  <div class="fb-share-button" data-href="https://blog.advancedenergyunited.org/top-2024-trends-in-legislative-and-regulatory-building-electrification-policy" data-layout="button_count"></div> </li> </ul> </div> </span> <div class="section post-body"> <span id="hs_cos_wrapper_post_body" class="hs_cos_wrapper hs_cos_wrapper_meta_field hs_cos_wrapper_type_rich_text" style="" data-hs-cos-general-type="meta_field" data-hs-cos-type="rich_text"><p><span data-contrast="auto"><img src="https://blog.advancedenergyunited.org/hs-fs/hubfs/Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png?width=730&height=365&name=Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png" width="730" height="365" loading="lazy" alt="Blog Developments in Building Electrification Policy Worth Watching" style="height: auto; max-width: 100%; width: 730px;" srcset="https://blog.advancedenergyunited.org/hs-fs/hubfs/Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png?width=365&height=183&name=Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png 365w, https://blog.advancedenergyunited.org/hs-fs/hubfs/Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png?width=730&height=365&name=Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png 730w, https://blog.advancedenergyunited.org/hs-fs/hubfs/Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png?width=1095&height=548&name=Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png 1095w, https://blog.advancedenergyunited.org/hs-fs/hubfs/Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png?width=1460&height=730&name=Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png 1460w, https://blog.advancedenergyunited.org/hs-fs/hubfs/Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png?width=1825&height=913&name=Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png 1825w, https://blog.advancedenergyunited.org/hs-fs/hubfs/Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png?width=2190&height=1095&name=Blog%20Developments%20in%20Building%20Electrification%20Policy%20Worth%20Watching.png 2190w" sizes="(max-width: 730px) 100vw, 730px"></span></p> <p><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>Over the course of 2024, </span><span>Advanced</span><span> Energy United </span><span>has been</span><span> </span><span>tracking and often engaging</span><span> </span><span>on</span><span>,</span><span> clean </span><span>building </span><span>policy developments </span><span>across the country</span><span>.</span><span> </span><span>As market and technology trends </span><span>evolve at </span><span>breakneck pace, </span><span>it’s</span><span> up to states to</span><span> either</span><span> </span><span>harness the momentum to deliver for consumers</span><span>,</span><span> or to</span><span> let outdated </span><span>policies </span><span>stymie </span><span>economic growth and </span><span>spiral </span><span>energy </span><span>costs out of control.</span><span> </span></span></p> <p><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>In this blog, </span><span>we’ve</span><span> rounded up</span><span> several </span><span>emerging </span><span>trends</span><span> </span><span>related to building electrification </span><span>worth watching in legislatures, at Public Utility Commissions, and among executive </span><span>offices</span><span> as they confront these issues in real time.</span></span></p> <p><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span><em>Click on the headers below to learn more about these trends:</em></span></span></p> <p style="font-weight: bold;"><a href="#Legislative" rel="noopener">Legislative Trends</a></p> <ol> <li><a href="#LegislativeTrend1" rel="noopener">Energy efficiency and weatherization are recognized as necessary pieces of the electrification puzzle</a></li> <li><a href="#LegislativeTrend2" rel="noopener">The potential for gas system shrinkage prompts efforts to modernize gas utility regulations</a></li> <li><a href="#LegislativeTrend3" rel="noopener">States take action to reduce barriers to heat pump adoption</a></li> <li><a href="#LegislativeTrend4" rel="noopener">Low-income electrification programs address high energy burdens in environmental justice communities</a></li> <li><a href="#LegislativeTrend5" rel="noopener">Thermal energy networks present new opportunities</a></li> <li><a href="#LegislativeTrend6" rel="noopener">Grid modernization and modern distribution system planning are being acknowledged as necessary for a reliable electric grid</a></li> </ol> <p style="font-weight: bold;"><a href="#RTTitle" rel="noopener">Regulatory Trends</a></p> <ol> <li><a href="#RT1" rel="noopener"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>Gas rate cases feel the heat</span></span><span data-ccp-props="{"134233279":true,"201341983":0,"335559739":0,"335559740":240}"> </span></a></li> <li><a href="#RT2" rel="noopener"><span data-ccp-props="{"134233279":true,"201341983":0,"335559739":0,"335559740":240}"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">“Non-Pipeline Alternatives” take center stage</span> </span></a></li> <li><span data-ccp-props="{"134233279":true,"201341983":0,"335559739":0,"335559740":240}"><a href="#RT3" rel="noopener"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">“Future of Gas” Proceedings continue asking questions</span></a> </span><br><span data-ccp-props="{"134233279":true,"201341983":0,"335559739":0,"335559740":240}"></span></li> </ol> <p><a href="#RT4" rel="noopener" style="font-weight: bold;">Bonus: Administrative and Federal Funding Trends</a></p> <ol> <li><a href="#AFFT1" rel="noopener">Home Energy Rebates</a></li> <li><a href="#AFFT2" rel="noopener">Climate Pollution Reduction Grants</a></li> </ol> <hr><a id="Legislative" data-hs-anchor="true"></a> <p style="font-weight: bold; font-size: 20px;">Legislative Trends</p> <p style="font-weight: normal;"><span data-contrast="none" xml:lang="EN-US" lang="EN-US"><span>Each year, thousands of bills are filed in legislatures</span><span>, </span><span>but</span><span> only a fraction become law. Clean energy and building laws are no different</span><span>, but even among the legislation that </span><span>doesn’t</span><span> make it over the finish line, </span><span>the patterns </span><span>we’ve</span><span> outlined provide insight on policymakers’ priorities.</span></span></p> <p style="font-weight: normal;"><em><span data-contrast="none" xml:lang="EN-US" lang="EN-US">In the overview below, bills with no asterisks means the bill has not made it out of one chamber, bills with one asterisk have passed one house of its legislature, two asterisks means that the bill has passed both chambers, and three means the bill has been signed into law.</span></em></p> <a id="LegislativeTrend1" data-hs-anchor="true"></a> <p style="font-weight: bold;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">1. Energy efficiency and weatherization are recognized as necessary pieces of the electrification puzzle</span></p> <p style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>In 2024, bills related to </span><span>energy efficiency and weatherization programs were some of the most </span><span>frequently</span><span> </span><span>filed</span><span>. </span><span>Given the </span><span>new challenges facing our energy system</span><span>, including</span><span> incoming </span><span>loads </span><span>from electrifying</span><span> buildings</span><span> and transportation</span><span>, </span><span>i</span><span>t’s</span><span> clear </span><span>that </span><span>states are thinking about </span><span>these measures </span><span>as the key to</span><span> affordability, peak load management, and system-wide cost containmen</span><span>t</span><span>. </span></span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p style="font-weight: normal;"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">11 states and the District of Columbia have introduced or passed legislation that have energy efficiency or weatherization components, and four states have signed those bills into law: </span> </span></p> <ul> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>Maryland </span></span><a href="https://app.insightengine.org/bills/md-hb864-2024-regular-session-2024-02-02?bill_search_id=1852772" target="_blank" rel="noreferrer noopener"><span data-contrast="none" xml:lang="EN-US" lang="EN-US"><span data-ccp-charstyle="Hyperlink">HB864</span></span></a><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>*** </span><span>directs both gas and electric utilities to develop efficiency, demand-response, and beneficial electrification programs. </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>In Michigan, <a href="https://app.insightengine.org/bills/mi-hb5028-102nd-legislature-2023-09-20?bill_search_id=1833894" target="_blank" rel="noreferrer noopener">HB5028</a>*** invalidates any homeowner’s association (HOA) agreement that prevents home energy-saving improvements or modifications.  </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>In Virginia, <a href="https://app.insightengine.org/bills/va-hb746-2024-regular-session-2024-01-09?bill_search_id=1852774" target="_blank" rel="noreferrer noopener">HB746</a>*** requires the State Corporation Commission to establish new energy efficiency savings targets every three years informed by an energy efficiency potential study.  </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>North Carolina <a href="https://app.insightengine.org/bills/nc-s802-2023-2024-session-2024-05-02?bill_search_id=1833894" target="_blank" rel="noreferrer noopener">S802</a>*** authorizes a statewide Commercial Property Assessed Capital Expenditure Program that allows for low-cost and long-term financing for energy efficiency and resilience projects.</span></span></li> </ul> <p><span data-contrast="auto">For bills that did not, or have not yet, passed in 2024, Pennsylvania </span><a href="https://app.insightengine.org/bills/pa-hb1615-2023-2024-regular-session?bill_search_id=1825673"><span data-contrast="none">HB1615</span></a><span data-contrast="auto">* would establish a minimum energy efficiency standard for commercial and residential products sold within the state. Hawaii </span><a href="https://app.insightengine.org/bills/hi-hb1828-2024-regular-session-2024-01-18?bill_search_id=1825662"><span data-contrast="none">HB1828</span></a><span data-contrast="auto">* would update the state’s energy efficiency standards and target dates and establish interim goals for energy use reduction. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">In Washington, </span><a href="https://app.insightengine.org/bills/wa-hb1391-2023-2024-regular-session?bill_search_id=1825662"><span data-contrast="none">HB1391</span></a><span data-contrast="auto">* would establish a navigator program to help building owners access electrification and energy efficiency services. Massachusetts </span><a href="https://app.insightengine.org/bills/ma-s2838-193rd-general-court-2024-06-25?bill_search_id=1825918"><span data-contrast="none">S2838</span></a><span data-contrast="auto">* adds assessments of energy consumption, efficiency, and greenhouse gas emissions in buildings owned by an authority or state agency. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Continuing, both New York and the District of Columbia have seen bills introduced related to resiliency projects, which tighten building envelopes and keep indoor temperatures comfortable while also flattening energy usage spikes during extreme weather – another form of energy efficiency. New York </span><a href="https://app.insightengine.org/bills/ny-s08535-2023-2024-general-assembly-2024-02-09?bill_search_id=1826027"><span data-contrast="none">S08535</span></a><span data-contrast="auto"> would create a “green affordable pre-electrification program” for owners or tenants otherwise ineligible for efficiency or resiliency incentives due to structural or code violations. District of Columbia </span><a href="https://app.insightengine.org/bills/dc-b25-0793-25th-council-2024-04-22?bill_search_id=1825729"><span data-contrast="none">B25-0793</span></a><span data-contrast="auto"> would create pathways to improve efficiency and resiliency in historic buildings while working with the Historic Preservation Review Board. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <a id="LegislativeTrend2" data-hs-anchor="true"></a> <p style="font-weight: bold;">2. <span data-contrast="auto" xml:lang="EN-US" lang="EN-US">The potential for gas system shrinkage prompts efforts to modernize gas utility regulations</span></p> <p><span data-contrast="auto">Another clear trend focuses on modernizing gas utility regulations and planning for a gas system in decline. As more buildings upgrade to electric appliances, states are considering the effects this has on gas infrastructure, and how to manage system shrinkage within a regulatory framework currently designed to incent only growth.  </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Two of the most notable bills in this category come from Washington and Illinois. Washington </span><a href="https://app.insightengine.org/bills/wa-hb1589-2023-2024-regular-session?bill_search_id=1833620"><span data-contrast="none">HB1589</span></a><span data-contrast="auto">***, which was signed into law in March, modernizes utility regulations by requiring large gas companies to file gas decarbonization plans with modified depreciation schedules. The bill also requires dual-fuel utilities to file electrification plans, allows dual-fuel utilities to consider merging their gas and electric rate bases, and encourages electric utilities to work with gas companies to identify opportunities for electrification. Illinois </span><a href="https://app.insightengine.org/bills/il-sb3935-103rd-general-assembly-2024-04-29?bill_search_id=1833894"><span data-contrast="none">SB3935</span></a><span data-contrast="auto"> is a monumental, omnibus clean heat bill that would establish a clean heat standard mandating gas utilities reach zero emissions by 2050, modernize gas utilities’ obligation to serve, establish gas efficiency standards, update the state’s gas planning and ratemaking frameworks, end gas appliance incentives, create a state navigator program, and so much more. While the bill has only been introduced, it’s expected to be a major focus heading into 2025. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Another state considering a clean heat standard is New Jersey, via </span><a href="https://app.insightengine.org/bills/nj-a3374-2024-2025-regular-session?bill_search_id=1833934"><span data-contrast="none">A3374</span></a><span data-contrast="auto">. The bill would establish a standard for gas utilities and other heating fuel suppliers, requiring clean heat credits to demonstrate compliance with the standard account for 80% of greenhouse gas emissions by 2050. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Separately, a legislator in Massachusetts introduced </span><a href="https://app.insightengine.org/bills/ma-h3203-193rd-general-court-2023-02-16?bill_search_id=1833894"><span data-contrast="none">H3203</span></a><span data-contrast="none">,</span><span data-contrast="auto"> which would establish a thermal transition fund to replace gas appliances in the state with electric counterparts, as well as mitigate pre-weatherization barriers and upgrade electric service as needed. The bill would also introduce studies on decarbonization pilot programs </span><span data-contrast="none">that would replace aging or leaking natural gas infrastructure and to determine customer rates for gas companies that facilitate conversion from gas to electricity.</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">In Colorado and California, two bills to minimize the costs of gas system shrinkage through pilot projects have gained momentum. Colorado </span><a href="https://app.insightengine.org/bills/co-hb1370-2024-regular-session-2024-03-11?bill_search_id=1825716"><span data-contrast="none">HB1370</span></a><span data-contrast="auto">*** was signed into law in May, directing the Colorado Energy Office to identify and work with communities and local governments for neighborhood-scale decarbonization pilot projects. Likewise, recently passed California </span><a href="https://app.insightengine.org/bills/ca-sb1221-2023-2024-session-2024-02-15?bill_search_id=1825716"><span data-contrast="none">SB1221</span></a><span data-contrast="auto">** would require gas utilities to identify neighborhoods for decarbonization pilots, and update the state’s obligation to serve for those communities within the program. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">New York </span><a href="https://app.insightengine.org/bills/ny-s02016-2023-2024-general-assembly-2023-01-18?bill_search_id=1826027"><span data-contrast="none">S2016</span></a><span data-contrast="auto">* would have also modernized the state’s obligation to serve, promoted neighborhood-scale transitions to clean heating, created a 6% energy burden cap, and repealed the statutory line extension allowances for gas utilities, colloquially known as the “100-foot rule.” Maine </span><a href="https://app.insightengine.org/bills/me-ld2077-131st-legislature-2023-12-20?bill_search_id=1833894"><span data-contrast="none">LD2077</span></a><span data-contrast="auto">** takes the study approach, requiring the Public Utility Commission, in combination with the Governor’s office, to evaluate the need and role of natural gas in the state and review emerging technologies. Finally, New Hampshire </span><a href="https://app.insightengine.org/bills/nh-hb1431-2024-regular-session-2023-12-06?bill_search_id=1825899"><span data-contrast="none">HB1431</span></a><span data-contrast="auto">***</span><span data-contrast="auto"> </span><span data-contrast="none">creates a new gas distribution planning process (along with an electric integrated distribution system planning process) with required assessments of demand-side management programs and non-pipeline alternatives.</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <a id="LegislativeTrend3" data-hs-anchor="true"></a> <p style="font-weight: bold;">3. <span data-contrast="auto" xml:lang="EN-US" lang="EN-US">States take action to reduce barriers to heat pump adoption</span></p> <p><span data-contrast="auto">Given federal incentives and rebates, and their </span><a href="https://www.canarymedia.com/articles/heat-pumps/heat-pumps-outsold-gas-furnaces-again-last-year-and-the-gap-is-growing"><span data-contrast="none">impressive rise in market share</span></a><span data-contrast="auto"> over the last two years in a row, it’s no surprise we’re seeing a trend in legislation related to heat pumps. Some states have passed legislation related to homeowner’s associations approval of heat pumps, some have introduced bills related to fuel switching, some have introduced rebate programs, and some are looking at heat pump deployment targets. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Washington and Michigan have both signed bills into law that restricts homeowner associations (HOAs) from prohibiting heat pump adoption. Washington </span><a href="https://app.insightengine.org/bills/wa-sb5973-2023-2024-regular-session-2024-01-04?bill_search_id=1825729"><span data-contrast="none">SB5973</span></a><span data-contrast="auto">*** makes a specific callout for prohibiting unreasonable restrictions on heat pumps. Michigan </span><a href="https://app.insightengine.org/bills/mi-hb5028-102nd-legislature-2023-09-20?bill_search_id=1833894"><span data-contrast="none">HB5028</span></a><span data-contrast="auto">*** more broadly prohibits HOA restriction of any energy-saving improvements or modifications, including, but not limited to, air source and ground source heat pumps. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">In Virginia, </span><a href="https://app.insightengine.org/bills/va-sb737-2024-regular-session-2024-01-19?bill_search_id=1825673"><span data-contrast="none">SB737</span></a><span data-contrast="auto">*** adds electrification to electric utilities’ energy efficiency programs, including building and industrial end uses like heat pumps, and encourages stacking of programs with Inflation Reduction Act (IRA) rebates for electrification upgrades. The law also establishes on-bill tariff programs to finance home upgrades. New Jersey </span><a href="https://app.insightengine.org/bills/nj-s249-2024-2025-regular-session-2024-01-09?bill_search_id=1860856"><span data-contrast="none">S249</span></a><span data-contrast="auto"> would require electric utilities to file beneficial electrification plans to help customers covert fossil-fuel appliances to high-efficiency electric and heat pump alternatives, and includes a directive to the Board of Public Utilities to create direct incentives for heat pumps.</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">New York </span><a href="https://app.insightengine.org/bills/ny-s08504-2023-2024-general-assembly-2024-02-06?bill_search_id=1825729"><span data-contrast="none">S8504</span></a><span data-contrast="auto">* would authorize the New York State Energy Research and Development Authority to administer grants or loans for the cost of switching residents with propane or fuel-oil heating systems to heat pumps. Similarly, Minnesota </span><a href="https://app.insightengine.org/bills/mn-hf4574-93rd-legislature-2023-2024-2024-03-04?bill_search_id=1850124"><span data-contrast="none">HF4574</span></a><span data-contrast="auto">* would introduce mechanisms for public utilities to implement efficient fuel-switching measures, like heat pumps, for a financial incentive. Minnesota Governor Walz also signed </span><a href="https://app.insightengine.org/bills/mn-sf4942-93rd-legislature-2023-2024-2024-03-13?bill_search_id=1857439"><span data-contrast="none">SF4942</span></a><span data-contrast="auto">*** into law, which appropriates funds for a heat pump rebate program. The Minnesota legislature also introduced a bill to create a geothermal heat pump rebate program; </span><a href="https://app.insightengine.org/bills/mn-hf4689-93rd-legislature-2023-2024-2024-03-07?bill_search_id=1852777"><span data-contrast="none">HF4689</span></a><span data-contrast="auto"> would work in conjunction with the Inflation Reduction Act to provide rebates based on building type. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">A final bill within this category is Connecticut </span><a href="https://app.insightengine.org/bills/ct-hb05004-2024-general-assembly-2024-02-29?bill_search_id=1833894"><span data-contrast="none">HB05004</span></a><span data-contrast="auto">, a package of climate-related measures which included a heat pump deployment target and a “Future of Gas” proceeding. Negotiations around the bill stalled at the last minute, leaving it dead for the remainder of 2024.</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <a id="LegislativeTrend4" data-hs-anchor="true"></a> <p style="font-weight: bold;">4. <span data-contrast="auto" xml:lang="EN-US" lang="EN-US">Low-income electrification programs address high energy burdens in environmental justice communities</span></p> <p><span data-contrast="auto">As more residents electrify and leave the gas system, those left behind will have to shoulder a larger share of their gas utility’s total system costs. The consumers unable to electrify, typically low-income residents, renters, and fixed-income seniors, will experience increasingly expensive gas bills, a situation known as the “utility death spiral.” This problem is exacerbated by gas utilities’ continued expansion of their pipeline systems. As a result, it is not surprising that we are seeing a focus on the early electrification of low-income and other vulnerable households, and measures to mitigate overall energy burdens challenges within clean heat legislation. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Two bills have been signed into law: first, the District of Columbia </span><a href="https://app.insightengine.org/bills/dc-b25-0119-25th-council-2023-02-02?bill_search_id=1826046"><span data-contrast="none">B25-0119</span></a><span data-contrast="none">***, which</span><span data-contrast="none"> </span><span data-contrast="auto">creates a Healthy Homes Program to install electric appliances for low- and moderate-income households and prohibits the Housing Authority from installing gas appliances through the Rental Assistance Demonstration Program. Second, in Connecticut, </span><a href="https://app.insightengine.org/bills/ct-sb00384-2024-general-assembly-2024-03-07?bill_search_id=1833894"><span data-contrast="none">SB00384</span></a><span data-contrast="auto">*** expands the role of the Low-Income Energy Advisory Board to develop weatherization assistance and utility rates as well as provide recommendations related to low-income energy services. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Separately, New York and Washington have both introduced bills concerning low-income energy burdened communities. New York </span><a href="https://app.insightengine.org/bills/ny-s02016-2023-2024-general-assembly-2023-01-18?bill_search_id=1826027"><span data-contrast="none">S2016</span></a><span data-contrast="auto">* would establish an energy burden cap, requiring low-to-moderate income customers be protected from bearing energy burdens greater than 6% of their income, including and the cost to purchase and operate electric appliances. Washington </span><a href="https://app.insightengine.org/bills/wa-hb1391-2023-2024-regular-session?bill_search_id=1826034"><span data-contrast="none">HB1391</span></a><span data-contrast="auto">* would establish a building energy upgrade navigator program tasked with prioritizing energy efficiency programs and services for low-income communities, a measure that Illinois </span><a href="https://app.insightengine.org/bills/il-sb3935-103rd-general-assembly-2024-04-29?bill_search_id=1833894"><span data-contrast="none">SB3935</span></a><span data-contrast="none"> also includes. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">There are two additional bills of note. California </span><a href="https://app.insightengine.org/bills/ca-sb1054-2023-2024-session-2024-02-08?bill_search_id=1826044" target="_blank" rel="noreferrer noopener"><span data-contrast="none" xml:lang="EN-US" lang="EN-US">SB1054</span></a><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">* was originally introduced as an initiative to provide financial assistance to low-income households for electrification upgrades. The bill has since been amended to require gas corporations to pass greenhouse gas allowance credits to residential customers. In Connecticut, </span><a href="https://app.insightengine.org/bills/ct-sb00301-2024-general-assembly-2024-02-29?bill_search_id=1833894" target="_blank" rel="noreferrer noopener"><span data-contrast="none" xml:lang="EN-US" lang="EN-US">SB00301</span></a><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"> would establish a fund to provide retrofits to multifamily residents in environmental justice communities, but the bill did not make it over the finish line. The introduction of both bills shows the salience of environmental justice issues, all while highlighting that more work is needed to address energy burdens. </span></span></p> <a id="LegislativeTrend5" data-hs-anchor="true"></a> <p style="font-weight: bold;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">5. Thermal energy networks present new opportunities</span></p> <p style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">Thermal energy networks are an attractive new offering on the building electrification scene, potentially allowing for the opportunity to electrify communities in a holistic and equitable manner, using the skills of gas pipeline workers, and leveraging supercharged system efficiencies to minimize impact to the electric grid at large.  </span></p> <ul> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>In Maryland, </span><a href="https://app.insightengine.org/bills/md-hb397-2024-regular-session-2024-01-17?bill_search_id=1825679" target="_blank" rel="noreferrer noopener"><span data-ccp-charstyle="Hyperlink">HB397</span></a><span>*** </span><span>requires gas utilities to </span><span>submit</span><span> proposals for pilot thermal energy networks, including measures for funding to cover electrification and weatherization costs for participating customers. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}">Similarly, in Washington, <a href="https://app.insightengine.org/bills/wa-hb2131-2023-2024-regular-session-2024-01-04?bill_search_id=1825716" target="_blank" rel="noreferrer noopener">HB2131</a>*** allows gas utilities to recover costs for operating thermal energy networks, and authorizes thermal energy networks to satisfy a gas utility’s obligation to serve.  </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}">In New Jersey, <a href="https://app.insightengine.org/bills/nj-a5442-2022-2023-regular-session?bill_search_id=1825679" target="_blank" rel="noreferrer noopener">A5442</a>*** directs the Board of Public Utilities to conduct a study on the feasibility of “large-scale geothermal systems” (aka, thermal energy networks). All three of these bills have been signed into law. </span></span></li> </ul> <p><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}">Other bills that have been introduced on the topic are Rhode Island <a href="https://app.insightengine.org/bills/ri-h7285-2024-regular-session-2024-01-26?bill_search_id=1825716" target="_blank" rel="noreferrer noopener">H7285</a> that would enable utilities to issue plans on thermal energy network investments and Vermont <a href="https://app.insightengine.org/bills/vt-h0669-2023-2024-session?bill_search_id=1825716" target="_blank" rel="noreferrer noopener">H0669</a> that would give the Public Utility Commission jurisdiction over utility thermal energy networks. In Minnesota, <a href="https://app.insightengine.org/bills/mn-hf4759-93rd-legislature-2023-2024-2024-03-07?bill_search_id=1851782" target="_blank" rel="noreferrer noopener">HF4759</a>, <a href="https://app.insightengine.org/bills/mn-hf4688-93rd-legislature-2023-2024-2024-03-07?bill_search_id=1851763" target="_blank" rel="noreferrer noopener">HF4688</a>, and <a href="https://app.insightengine.org/bills/mn-hf4423-93rd-legislature-2023-2024-2024-02-28?bill_search_id=1851780" target="_blank" rel="noreferrer noopener">HF4423</a> would, respectively, establish a grant program for geothermal systems by political subdivisions, set up a thermal energy network deployment work group to explore how natural gas utilities can develop thermal energy networks, and require innovation plans filed by gas utilities to include thermal energy network pilot projects in disadvantaged communities. For all three of these states, legislative sessions are complete, and these bills did not make it passed introduction.  </span></span></p> <a id="LegislativeTrend6" data-hs-anchor="true"></a> <p style="font-weight: bold;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">6. Grid modernization and modern distribution system planning are being acknowledged as necessary for a reliable electric grid </span></p> <p style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">Building electrification, which moves a customer off one energy system (the gas network) and onto another (the electric grid), creates opportunities and new challenges for states and utilities, mainly on the electric distribution system. This explains our final legislative trend of the year: grid modernization and modern distribution system planning.  </span></p> <ul> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>Colorado </span><a href="https://app.insightengine.org/bills/co-sb218-2024-regular-session-2024-04-24?bill_search_id=1825893" target="_blank" rel="noreferrer noopener"><span data-ccp-charstyle="Hyperlink">SB218</span></a><span>*** </span><span>was signed into law in </span><span>May and</span><span> includes requirements for electric utilities to modernize their distribution systems to support decarbonization goals. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}">New Hampshire <a href="https://app.insightengine.org/bills/nh-hb1431-2024-regular-session-2023-12-06?bill_search_id=1825899" target="_blank" rel="noreferrer noopener">HB1431</a>*** was also signed into law, requiring electric and gas utilities to submit integrated distribution plans to ensure reliability and consistency with state energy goals.  </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}">Less successful, Maryland <a href="https://app.insightengine.org/bills/md-sb1083-2024-regular-session-2024-02-02?bill_search_id=1833935" target="_blank" rel="noreferrer noopener">SB1083</a> did not make it past introduction, but the bill sought to require the Public Service Commission to oversee electric distribution planning.  </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}">New Jersey <a href="https://app.insightengine.org/bills/nj-s258-2024-2025-regular-session-2024-01-09?bill_search_id=1833937" target="_blank" rel="noreferrer noopener">S258</a> would require electric public utilities to implement grid modernization plans, and <a href="https://app.insightengine.org/bills/nj-a2384-2024-2025-regular-session?bill_search_id=1833938" target="_blank" rel="noreferrer noopener">A2384</a> would create a New Jersey Grid Modernization Task Force to plan for grid modernization in anticipation of increased demand.  </span></span></li> <li style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}">New York <a href="https://app.insightengine.org/bills/ny-a06253-2023-2024-general-assembly-2023-04-03?bill_search_id=1825899" target="_blank" rel="noreferrer noopener">A6253</a>* would create the New York state grid modernization commission requiring a study of research, development, and demonstrations of electric grid modernization.   </span></span></span></span><br><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"></span></span></span><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"></span></span></li> </ul> <hr><a id="RTTitle" data-hs-anchor="true"></a> <p style="font-weight: bold; font-size: 20px;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">Regulatory Trends</span></p> <a id="RT1" data-hs-anchor="true" style="font-weight: bold;"></a> <p style="font-weight: bold;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}">1. Gas rate cases feel the heat </span></span></p> <p><span data-contrast="auto">Across the country, gas utilities are asking to raise rates on customers: </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <ul> <li><span data-contrast="auto">In </span><a href="https://www.wfsb.com/2024/04/02/natural-gas-utilities-asking-illegal-items-rate-increase-request-i-team-finds/"><span data-contrast="none">Connecticut</span></a><span data-contrast="auto">, Connecticut Natural Gas and Southern Connecticut Gas are asking to collect $6 to $13 more per month from each gas customer. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></li> <li><span data-contrast="auto">In </span><a href="https://www.opb.org/article/2024/05/20/oregon-electricity-ultilites-cost-portland-general-electric-northwest-naturals/"><span data-contrast="none">Oregon</span></a><span data-contrast="auto">, Portland General Electric wants to increase rates 7.4% next year, and Northwest Natural wants to raise rates by 18%, on top of recent increases to the tune of 20%. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></li> <li><span data-contrast="auto">Customers of </span><a href="https://kansasreflector.com/2024/06/14/theres-too-much-profit-customers-decry-proposed-natural-gas-rate-increase/"><span data-contrast="none">Kansas Gas Service</span></a><span data-contrast="auto"> face either a 10.41% rate increase or a 8.25% rate increase, depending on how much gas they use month to month. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></li> <li><span data-contrast="auto">NorthWestern Energy in </span><a href="https://www.ktvh.com/news/montana-psc-wants-more-information-on-northwestern-energy-rate-increase-request"><span data-contrast="none">Montana</span></a><span data-contrast="auto"> has proposed a $5/month increase on gas bills this year, and another $4/month to add to bills in 2025. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></li> <li><a href="https://www.austinmonitor.com/stories/2024/07/major-gas-bill-hike-to-be-contested-by-city-this-fall/"><span data-contrast="none">Texas Gas Service</span></a><span data-contrast="auto"> is asking for regulators to approve an increase of up to $10/month for Austin-area customers.</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></li> <li><a href="https://www.southwestledger.news/news/2021-winter-storm-uri-bonds-total-approximately-45b-0"><span data-contrast="none">Oklahoma</span></a><span data-contrast="auto"> regulators approved adding between $5.72 and $7.82/month for the next 25 years to customers of Oklahoma Natural Gas to pay off debt accrued during Winter Storm Uri.</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></li> <li><a href="https://www.michigan.gov/ag/news/press-releases/2024/01/09/michigan-ag-nessel-intervenes-in-dtes-requested-gas-rate-increase"><span data-contrast="none">DTE</span></a><span data-contrast="auto">, a Michigan-based utility, is requesting a 10% increase to its residential gas customer rates.</span></li> </ul> <p><span data-contrast="auto">Though the reasons for the rate hikes vary, they reflect a larger challenge facing the gas industry – infrastructure projects are accelerating to maintain, replace, and expand pipeline networks. The costs associated with these projects are far outpacing customer growth and quantity of gas sold, making each unit of gas increasingly expensive to deliver to homes and businesses. But other factors are at play as well. Texas Gas Service </span><a href="https://www.austinmonitor.com/stories/2024/07/major-gas-bill-hike-to-be-contested-by-city-this-fall/"><span data-contrast="none">explained</span></a><span data-contrast="auto"> on its website: </span><span data-contrast="none">“</span><span data-contrast="none">demand has grown faster than supply can keep up with, coupled with the general state of the economy, war in Ukraine and extreme weather events, we see higher prices across the globe. In fact, natural gas prices are nearly 100% higher than a year ago.”</span><span data-contrast="none"> </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Nonetheless, opposition to the rate hikes is widespread. </span><a href="https://www.wfsb.com/2024/04/02/natural-gas-utilities-asking-illegal-items-rate-increase-request-i-team-finds/"><span data-contrast="none">Connecticut</span></a><span data-contrast="auto"> journalists dug through utility filings to find that utilities were requesting to recover travel and meal costs for their board of directors, investor relation fees, and membership dues to trade associations that violate provisions of a state law passed in 2023 (</span><a href="https://app.insightengine.org/bills/ct-sb00007-2023-general-assembly-2023-01-04?bill_search_id=1849052"><span data-contrast="none">Senate Bill 7</span></a><span data-contrast="auto">). In </span><a href="https://www.opb.org/article/2024/05/20/oregon-electricity-ultilites-cost-portland-general-electric-northwest-naturals/"><span data-contrast="none">Oregon</span></a><span data-contrast="auto">, ratepayer advocates and citizen groups worry that consistent, year after year increases on </span><i><span data-contrast="auto">both</span></i><span data-contrast="auto"> electric and gas bills are making it impossible for vulnerable residents and families to keep up. Customers in </span><a href="https://kansasreflector.com/2024/06/14/theres-too-much-profit-customers-decry-proposed-natural-gas-rate-increase/"><span data-contrast="none">Kansas</span></a><span data-contrast="auto"> highlight executive pay, ballooning administrative costs, and debt financing as factors that make the rate hikes unjust. </span><a href="https://www.ktvh.com/news/montana-psc-wants-more-information-on-northwestern-energy-rate-increase-request"><span data-contrast="none">Montana</span></a><span data-contrast="auto"> regulators sent the rate hike request back to the utility after determining that the application didn’t meet “minimum filing standards,” because it failed to include financial data and information on how the plan would impact its own customers. The </span><a href="https://www.michigan.gov/ag/news/press-releases/2024/01/09/michigan-ag-nessel-intervenes-in-dtes-requested-gas-rate-increase"><span data-contrast="none">Attorney General in Michigan</span></a><span data-contrast="auto"> is wary that repeated rate increases may demonstrate that DTE’s plans “are more aligned to shareholder benefits than ensuring ratepayers can keep their homes warm all winter.”</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">There’s good reason to expect that further tumult in the gas utility industry is forthcoming, and these rate hikes are just the beginning. All eyes will be on customers, utility regulators, governors, and state legislatures to see if and how they respond, and further, what those responses might means for the future of affordable heat. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <a id="RT2" data-hs-anchor="true"></a> <p><span style="font-weight: bold;"> 2. <span data-contrast="auto" xml:lang="EN-US" lang="EN-US">“Non-Pipeline Alternatives” take center stage</span> </span><span data-contrast="auto"></span></p> <p><span data-contrast="auto">Emerging as the next big thing in gas utility planning, non-pipeline alternatives (NPAs) are resources, or portfolios of resources, that can defer, reduce, or avoid the need traditional pipeline projects. They can include demand-side interventions, such as energy efficiency, gas demand response, appliance electrification, or gas rates, or supply side resources such as propane, local injections of gas resources, trucking compressed or liquified natural gas, and more. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Early examples demonstrate that NPA projects, while challenging to design and implement, can net significant benefits. In July 2023, Consolidated Edison filed two benefit-cost analyses for new NPA programs, the </span><a href="https://app.insightengine.org/dockets/ny-22-00218-22-g-0065/documents/ny-22-00218-22-g-0065-D-38ef563ceac12fa1da2fa79f4420e2f627193dcf?version=beta&filing_search_id=1835228"><span data-contrast="none">Con Edison Energy Exchange Program</span></a><span data-contrast="auto"> and the </span><a href="https://app.insightengine.org/dockets/ny-22-00218-22-g-0065/documents/ny-22-00218-22-g-0065-D-cff80ed738628f7238cdd42ff7e2d733a53a4c6c?version=beta&filing_search_id=1835228"><span data-contrast="none">Con Edison Electric Advantage Program</span></a><span data-contrast="auto">, proving the theory: NPAs can save millions of dollars in avoided costs, lower customer bills, and reduce peak day gas capacity needs. Earlier in the year, Colorado Public Utility Commissioners wrote in a </span><a href="https://app.insightengine.org/dockets/co-23m-0234g/documents/co-23m-0234g-D-1d4eee6ae52ebe4651f0e9bb3860680188a71745?version=beta&filing_search_id=1849066"><span data-contrast="none">formal order</span></a><span data-contrast="auto"> on Xcel Colorado’s first-ever Gas Infrastructure Plan, “The Commission is encouraged by how cost effective many of the presented NPA portfolios appear, especially given that they have several assumptions, as discussed above, which may make actual cost effectiveness of alternatives more favorable than the calculations presented.”</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">These positive results give proponents hope that NPAs can become a key resource to contain costs during this moment of rapid change in the gas utility industry. However, NPAs are still new to the scene, and many questions remain about 1) when and where NPAs are appropriate and optimal, 2) how to design and implement NPA projects, 3) how to calculate their costs and benefits against the default pipeline project, and 4) how to fit NPAs into ongoing gas utility planning and operations. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">Several states, and their Public Utility Commissions, are at the leading edge of this conversation. They include New York, Massachusetts, Colorado, Minnesota, and Missouri. Though New York utilities have </span><a href="https://app.insightengine.org/dockets/ny-17-02100-17-g-0606/documents/ny-17-02100-17-g-0606-D-384aa8771bafa3ee20d0b8a94ead9c3d8341f23d?version=beta&filing_search_id=1849059"><span data-contrast="none">used non-pipe solicitations</span></a><span data-contrast="auto"> several times in the past to solve for specific pipeline constraints, the Public Service Commission is </span><a href="https://app.insightengine.org/dockets/ny-20-00652-20-g-0131/documents/ny-20-00652-20-g-0131-D-6a2f50d63ed2dea647564b3693089e665a77be4d?version=beta&filing_search_id=1849055"><span data-contrast="none">now looking to create</span></a><span data-contrast="auto"> a comprehensive NPA framework, with stakeholder and local distribution company input, within its overarching Gas Planning Procedures docket. Similarly, Massachusetts is pursuing a formal NPA analysis framework as </span><a href="https://app.insightengine.org/dockets/ma-20-80/documents/ma-20-80-D-6ab1ccb8d4eb03cad915c189606f21abc7fff12c?version=beta&filing_search_id=1849062"><span data-contrast="none">directed</span></a><span data-contrast="auto"> by the Department of Public Utilities (DPU) in April 2024. This decision follows the DPU’s </span><a href="https://app.insightengine.org/dockets/ma-20-80/documents/ma-20-80-D-d40c7408f83ef28fcb607ccbdd3cecbeee2f5df5?version=beta&filing_search_id=1849062"><span data-contrast="none">landmark order</span></a><span data-contrast="auto"> in December 2023, which required local gas distribution companies to conduct NPA analyses for all projects seeking cost recovery as a key component of any prudence determination. Though the gas utilities are the primary obligated party, the DPU made clear that any framework had to be created in consultation with stakeholders. As such, the utilities have </span><a href="https://app.insightengine.org/dockets/ma-20-80/documents/ma-20-80-D-7616345207550277c22749953e44adc374d35519?version=beta&filing_search_id=1849062"><span data-contrast="none">announced</span></a><span data-contrast="auto"> that they are in the final stages of hiring a facilitator to conduct that engagement with interested parties, which is expected to commence this fall.   </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">In the west, the Colorado Public Utilities Commission </span><a href="https://app.insightengine.org/dockets/co-23m-0234g/documents/co-23m-0234g-D-1d4eee6ae52ebe4651f0e9bb3860680188a71745?version=beta&filing_search_id=1849066"><span data-contrast="none">gave the green light</span></a><span data-contrast="auto"> to two significant NPA projects, including one alongside Boulder, Colorado’s famous Pearl Street Mall. After those early positive results from the first set of NPA analyses, the Commission </span><a href="https://app.insightengine.org/dockets/co-23m-0234g/documents/co-23m-0234g-D-d31bf92b01e565fcfeb62455e5d3c2ec5460a2c8?version=beta&filing_search_id=1849067"><span data-contrast="none">directed</span></a><span data-contrast="auto"> Xcel to conduct NPA analyses for all new business and capacity expansion projects that appear in its 2025 Gas Infrastructure Plan. They also encouraged NPA analyses on system safety and integrity projects whenever feasible so that customers do not miss out on potential savings opportunities, and directed the utility to consider how NPAs could include the electrification of Xcel’s gas-only customers (versus the customers for which it is both the electric and gas utility). Lastly, they </span><a href="https://app.insightengine.org/dockets/co-23m-0234g/documents/co-23m-0234g-D-1d4eee6ae52ebe4651f0e9bb3860680188a71745?version=beta&filing_search_id=1849066"><span data-contrast="none">directed</span></a><span data-contrast="auto"> Xcel to conduct at least one competitive solicitation process for its next round of NPAs, to be evaluated by an Independent Evaluator. A newly opened </span><a href="https://app.insightengine.org/dockets/co-24m-0261g?version=beta&docket_search_id=1849064"><span data-contrast="none">docket</span></a><span data-contrast="auto"> is meant to further refine Colorado’s NPA process by allowing Xcel and stakeholders to collaboratively develop a cost-benefit analysis handbook for these new types of projects.</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">In the central states, a new Minnesota </span><a href="https://app.insightengine.org/dockets/mn-21-565/documents/mn-21-565-D-8036349e0562bb43de5bb4771f17a00f90c75209?version=beta&filing_search_id=1848685"><span data-contrast="none">framework</span></a><span data-contrast="auto"> for gas utility integrated resource planning asks utilities to identify two to three significant upcoming capacity expansion projects for which they will conduct a “full alternatives evaluation.” The order applies to CenterPoint, Minnesota Energy Resources, and Xcel Minnesota, a sibling utility to Xcel Colorado. Spire Missouri is anticipated to file its first Gas Integrated Resource Plan later this year, which will include a NPA pilot as per a </span><a href="https://psc.mo.gov/NaturalGas/PSC_Approves_Agreement_Reached_in_Spire_East_ACA_Case--pr-24-20"><span data-contrast="none">settlement agreement</span></a><span data-contrast="auto"> in Spire East’s 2023 rate case.</span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <p><span data-contrast="auto">The addition of NPAs into gas utility planning and rate case frameworks is up for discussion in several additional states, including </span><a href="https://app.insightengine.org/dockets/nv-23-07024?version=beta&docket_search_id=1849072"><span data-contrast="none">Nevada</span></a><span data-contrast="auto">, </span><a href="https://app.insightengine.org/bills/il-sb3935-103rd-general-assembly-2024-04-29?bill_search_id=1849077"><span data-contrast="none">Illinois</span></a><span data-contrast="auto">, </span><a href="https://app.insightengine.org/dockets/ca-r2001007?version=beta&docket_search_id=1849080"><span data-contrast="none">California</span></a><span data-contrast="auto">, </span><a href="https://app.insightengine.org/dockets/ct-23-11-02?docket_search_id=1849074&filing_search_id=1849078&version=beta&workspace=all#search-results-anchor"><span data-contrast="none">Connecticut</span></a><span data-contrast="auto"> and </span><a href="https://app.insightengine.org/dockets/mi-u-21291?filing_search_id=1846396"><span data-contrast="none">Michigan</span></a><span data-contrast="auto">. </span><span data-ccp-props="{"201341983":0,"335559739":0,"335559740":240}"> </span></p> <a id="RT3" data-hs-anchor="true"></a> <p style="font-weight: bold;">3. <span data-contrast="auto" xml:lang="EN-US" lang="EN-US">“Future of Gas” Proceedings continue asking questions</span> </p> <p><span data-contrast="auto">Used in prior years by states including Massachusetts, Rhode Island, New York, Minnesota, Oregon, Washington, Colorado, and Nevada, “Future of Gas” dockets continue to be a popular tool to discuss how a state will respond to new building technology trends and gas industry headwinds. This year, all eyes have been on Illinois, Maryland, and California.</span><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"> </span></p> <p><span data-contrast="auto">In March, the Illinois Commerce Commission kicked off a fully-facilitated, year-long </span><a href="https://www.icc.illinois.gov/programs/Future-of-Gas-Workshop#:~:text=The%20Future%20of%20Gas%20proceeding,system%20may%20need%20to%20adapt."><span data-contrast="none">workshop process</span></a><span data-contrast="auto"> to “evaluate the impacts of Illinois’ current decarbonization and electrification goals on the natural gas system.” Over the course of the spring, stakeholders convened for seven discussion sessions to cover topics from energy efficiency and carbon-free technologies to workforce issues, and manufacturing and industrial uses of natural gas. These initial sessions were used to gather a comprehensive list of topics to discuss during the latter half of the year (the results of which can be found in this </span><a href="https://icc.illinois.gov/api/web-management/documents/downloads/public/future-of-gas/ICC%20Future%20of%20Gas%20Workshops%20Facilitator%20and%20ICC%20Staff%20Report_Final_7-29-2024.pdf"><span data-contrast="none">report</span></a><span data-contrast="auto">). Deeper, more substantive conversations on each key topic are anticipated throughout the rest of the year and into 2026. </span><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"> </span></p> <p><span data-contrast="auto">In July, the Maryland Public Service Commission held an </span><a href="https://www.baltimoresun.com/2024/07/25/future-of-gas-maryland-psc/"><span data-contrast="none">engaging hearing</span></a><span data-contrast="auto"> on the Office of People’s Counsel’s </span><a href="https://webpsc.psc.state.md.us/DMS/case/9707"><span data-contrast="none">2023 petition</span></a><span data-contrast="auto"> to open a docket to “address the planning, practices, and future operations of the gas public service companies” and fast track time-sensitive issues expected to worsen energy affordability in Maryland if left unaddressed. Though the process at the PSC has been sluggish to date, the rest of the state government has used the first half of 2024 to support building decarbonization in a variety of complementary ways: the legislature passed </span><a href="https://app.insightengine.org/bills/md-hb864-2024-regular-session-2024-02-02?bill_search_id=1852036"><span data-contrast="none">a bill</span></a><span data-contrast="auto"> to encourage beneficial electrification, and the Moore administration announced both a zero-emission heating equipment standard and clean heat standard via </span><a href="https://governor.maryland.gov/news/press/pages/governor-moore-signs-executive-order-to-advance-maryland%e2%80%99s-pollution-reduction-plan.aspx"><span data-contrast="none">Executive Order</span></a><span data-contrast="auto">. Watch </span><a href="https://app.insightengine.org/dockets/md-9707?version=beta&docket_search_id=1852042"><span data-contrast="none">Docket 9707</span></a><span data-contrast="auto"> in Maryland for more action over the next several months. </span><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"> </span></p> <p><span data-contrast="auto">In California, two key dockets together address the future of gas and the transition to decarbonized buildings: </span><a href="https://app.insightengine.org/dockets/ca-r2001007?version=beta&docket_search_id=1852044"><span data-contrast="none">R20-01-007</span></a><span data-contrast="auto"> and </span><a href="https://app.insightengine.org/dockets/ca-r1901011?version=beta&docket_search_id=1852044"><span data-contrast="none">R19-01-011</span></a><span data-contrast="auto">. Both have been ongoing for several years, though have continued to stand as the main venue to implement changes to gas and electric utility regulations to support electrification to date. In the former, the California Public Utilities Commission (CPUC) offered a “</span><a href="https://app.insightengine.org/dockets/ca-r2001007/documents/ca-r2001007-D-c4b76b823c9ecfa0ef8a20cacc430a9ed4e388d7?version=beta&filing_search_id=1852047"><span data-contrast="none">Joint Agency Staff Gas Transition White Paper</span></a><span data-contrast="auto">” summarizing statewide efforts and proceeding findings so far. Then, they </span><a href="https://app.insightengine.org/dockets/ca-r2001007/documents/ca-r2001007-D-385f7c498f35ccb9c4b2c036f882a0df2360bc98?filing_search_id=1852047"><span data-contrast="none">asked stakeholders</span></a><span data-contrast="auto"> to help them scope “Phase 3” of the proceeding, which will focus on Gas Transition Scenario Analysis, Long-Term Gas Transition Planning Approaches, and Opportunities for Interim Action. Since then, the CPUC has </span><a href="https://app.insightengine.org/dockets/ca-r2001007/documents/ca-r2001007-D-dee75cf0b518cfd330480a2bcb6247402106121f?filing_search_id=1860971"><span data-contrast="none">decided to close that docket</span></a><span data-contrast="auto">, with the promise of a new one to continue the conversation. In the latter, the CPUC </span><a href="https://app.insightengine.org/dockets/ca-r1901011/documents/ca-r1901011-D-ed6dce8a7dd03e0334c0d880aac5c36d2d986088?version=beta&filing_search_id=1852045"><span data-contrast="none">proposed to discuss</span></a><span data-contrast="auto"> refining their approach to line extension allowances and service line upsizing, creating voluntary zonal decarbonization pilot programs, developing a building decarbonization action plan consistent with the state’s climate and energy goals, and more. </span><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"> </span></p> <hr><a id="RT4" data-hs-anchor="true"></a> <p style="font-weight: bold; font-size: 20px;">Bonus: Administrative and Federal Funding Trends</p> <p style="font-weight: normal;"><span data-contrast="auto" xml:lang="EN-US" lang="EN-US">2024 is the year that Governors and their administrations race to secure federal funding from the Inflation Reduction Act and Bipartisan Infrastructure Law – some available to all who want it, and some available to winners of competitive application processes. Overall, efforts to make our buildings cleaner, more efficient, more resilient, and more affordable have received billions of dollars. Here’s where things stand: </span> </p> <a id="AFFT1" data-hs-anchor="true"></a> <ul> <li style="font-weight: normal;"><a href="https://www.energy.gov/save/rebates" target="_blank" rel="noreferrer noopener"><span data-contrast="none" xml:lang="EN-US" lang="EN-US"><span data-ccp-charstyle="Hyperlink">Home Energy Rebates</span></span></a><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"></span><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"> </span></li> </ul> <p><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>As of August 5</span></span><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span data-fontsize="12">th</span></span><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>, 2024, </span><span>50 states and territories </span><span>had </span><span>applied for early administrative </span><span>support or full program funding</span><span>, </span><span>representing</span><span> </span><span>$3.1 billion</span><span> to help residents install </span><span>clean appliances and make other efficiency upgrades</span><span>. </span><span>Of those, </span><span>15 </span><span>states </span><span>have their </span><span>full </span><span>applications </span><span>submitted</span><span> and pending before the Department of Energy</span><span>, and 8 states have received approval but are still working to launch their programs. Only New York</span><span>, </span><span>Wisconsin</span><span>, </span></span><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>New Mexico,</span></span><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span> </span><span>and Arizona</span><span> </span><span>have made rebates available to residents to date, but more announcements are expected before the end of the year. </span></span><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"><span>In total, the Home Energy Rebates amount to </span><span>roughly </span><span>$8.6 billion</span><span> in direct rebates to mostly low- and moderate-income households to </span><span>purchase</span><span> electric appliances and to make efficiency upgrades to their homes.</span></span><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"> </span></p> <a id="AFFT2" data-hs-anchor="true"></a> <ul> <li><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"><a href="https://www.epa.gov/inflation-reduction-act/cprg-implementation-grants-general-competition-selections" target="_blank" rel="noreferrer noopener"><span data-contrast="none" xml:lang="EN-US" lang="EN-US">Climate Pollution Reduction Grants</span></a><span data-contrast="auto" xml:lang="EN-US" lang="EN-US"></span> </span></li> </ul> <p><span data-contrast="auto">In July, the Environmental Protection Agency announced 25 awardees of Climate Pollution Reduction Grants, dolling out more than $4.3 billion for “community-driven solutions to the climate crisis, reduce air pollution, advance environmental justice, and accelerate America’s clean energy transition.” From those grants, the building sector is set to receive $1.06 billion to deploy approximately 580,000 heat pumps, and improve energy efficiency in 700,000 homes, 250 public buildings, and 50 million square feet of commercial space. Notable projects include the </span><a href="https://portal.ct.gov/deep/news-releases/news-releases---2024/gov-lamont-announces-ct-receives-fed-grant-to-accelerate-adoption-of-affordable-electric-heat-pumps"><span data-contrast="none">New England Heat Pump Accelerator</span></a><span data-contrast="auto">, the </span><a href="https://www.epa.gov/inflation-reduction-act/city-new-haven-connecticut"><span data-contrast="none">New Haven Union Station</span></a><span data-contrast="auto"> networked geothermal heating and cooling project, the </span><a href="https://www.epa.gov/inflation-reduction-act/denver-regional-council-governments-colorado"><span data-contrast="none">Denver Regional Council of Governments Zero-Emission Building Initiative</span></a><span data-contrast="auto">, and the </span><a href="https://www.epa.gov/inflation-reduction-act/state-illinois"><span data-contrast="none">Illinois program</span></a><span data-contrast="auto"> to retrofit 12,000 homes, millions of feet of commercial space, and develop the clean buildings workforce. </span><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"> </span></p> <p><span data-contrast="auto">You can expect to see similar projects take shape in South Carolina, Connecticut and New England, Louisiana, Colorado, Illinois, Washington, Arkansas, Minnesota, Nebraska, Oregon, Alaska, Utah, and the Nez Perce Tribe in Idaho. </span><span data-ccp-props="{"201341983":0,"335559739":160,"335559740":240}"> </span></p></span> </div> <p id="hubspot-topic_data"> Topics: <a class="topic-link" href="https://blog.advancedenergyunited.org/topic/building-electrification">Building Electrification</a> </p> </div> </div>  </div> </div> </div> </div> </div> </div> <div class="row-fluid-wrapper row-depth-1 row-number-5 "> <div class="row-fluid "> <div class="span12 widget-span widget-type-custom_widget " style="" data-widget-type="custom_widget" data-x="0" data-w="12"> <div id="hs_cos_wrapper_module_1593459265801341" class="hs_cos_wrapper hs_cos_wrapper_widget hs_cos_wrapper_type_module widget-type-blog_comments" style="" data-hs-cos-general-type="widget" data-hs-cos-type="module"><span id="hs_cos_wrapper_module_1593459265801341_blog_comments" class="hs_cos_wrapper hs_cos_wrapper_widget hs_cos_wrapper_type_blog_comments" style="" data-hs-cos-general-type="widget" data-hs-cos-type="blog_comments"> <div class="section post-footer"> <div id="comments-listing" class="new-comments"></div> </div> </span></div> </div> </div> </div> </div> <div class="span4 widget-span widget-type-cell blog-sidebar" style="" data-widget-type="cell" data-x="8" data-w="4"> <div class="row-fluid-wrapper row-depth-1 row-number-6 "> <div class="row-fluid "> <div class="span12 widget-span widget-type-custom_widget " style="" data-widget-type="custom_widget" data-x="0" data-w="12"> <div id="hs_cos_wrapper_module_1593459524519402" class="hs_cos_wrapper hs_cos_wrapper_widget hs_cos_wrapper_type_module widget-type-rich_text" style="" data-hs-cos-general-type="widget" data-hs-cos-type="module"><span id="hs_cos_wrapper_module_1593459524519402_" class="hs_cos_wrapper hs_cos_wrapper_widget hs_cos_wrapper_type_rich_text" style="" data-hs-cos-general-type="widget" data-hs-cos-type="rich_text"><h3>Search</h3> <script src="https://cse.google.com/cse.js?cx=009956085972058874511:afj7xh_vpc0" async></script> <div class="gcse-search"> </div></span></div> </div> </div> </div> <div class="row-fluid-wrapper row-depth-1 row-number-7 "> <div class="row-fluid "> <div class="span12 widget-span widget-type-custom_widget " style="" data-widget-type="custom_widget" data-x="0" data-w="12"> <div id="hs_cos_wrapper_module_1593459377615343" class="hs_cos_wrapper hs_cos_wrapper_widget hs_cos_wrapper_type_module widget-type-rich_text" style="" data-hs-cos-general-type="widget" data-hs-cos-type="module"><span id="hs_cos_wrapper_module_1593459377615343_" class="hs_cos_wrapper hs_cos_wrapper_widget hs_cos_wrapper_type_rich_text" style="" data-hs-cos-general-type="widget" data-hs-cos-type="rich_text"><div class="cell-wrapper layout-widget-wrapper"> <h3>About</h3> <p>Advanced Energy Perspectives is Advanced Energy United's blog presenting news, analysis, and commentary on creating an advanced energy economy. 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href="https://blog.advancedenergyunited.org/topic/pucs">PUCs <span class="filter-link-count" dir="ltr">(55)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/this-is-advanced-energy">This Is Advanced Energy <span class="filter-link-count" dir="ltr">(53)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/guest-post">Guest Post <span class="filter-link-count" dir="ltr">(46)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/epa-ghg-regs">EPA GHG Regs <span class="filter-link-count" dir="ltr">(44)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/california-engagement">California Engagement <span class="filter-link-count" dir="ltr">(42)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/advanced-energy-technology-of-the-week">Advanced Energy Technology of the Week <span class="filter-link-count" dir="ltr">(40)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/decision-maker-engagement">Decision Maker Engagement <span class="filter-link-count" dir="ltr">(36)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/transmission">Transmission <span class="filter-link-count" dir="ltr">(35)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/manufacturing-and-infrastructure">Manufacturing and Infrastructure <span class="filter-link-count" dir="ltr">(34)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/advanced-energy-employment">Advanced Energy Employment <span class="filter-link-count" dir="ltr">(23)</span></a> </li> <li style="display:none;"> <a href="https://blog.advancedenergyunited.org/topic/highlights">Highlights <span class="filter-link-count" 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