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What Is Driving Changes In California Energy Policy?

Image from iStock

California is pushing hard to cut its carbon footprint.  Senate Bill 32 (passed in 2016), requires the state
to reduce greenhouse gas (GHG) emissions to 40 percent below 1990 levels by
2030; in 2018, former Governor Brown signed SB
which set a target to make the state completely carbon neutral by 2045.

Because of this, we’ve recently seen a sudden and urgent push to electrify multiple energy sectors across the state. But why is electrification such a crucial strategy? The California Air Resources Board (CARB) has identified emission sources statewide in their scoping report. See the chart below from their 2019 Executive Summary.

As you can see from the illustration above, the transportation sector is, without question, the largest source of emissions in the state. What may surprise you is that nearly 10 percent of emissions statewide are from residential and commercial buildings. If we consider the impact of natural gas leaks in the transportation and distribution system, the contribution from buildings is even more significant. According to a Natural Resources Defense Council report, factoring in these “fugitive methane leaks” makes buildings responsible for almost 25 percent of emissions statewide—the second or third largest contributor, depending on whose numbers you see.

Given that buildings and transportation are two of the largest
sources of emissions, it should come as no surprise that one of the most
promising policy strategies for reducing the state’s carbon footprint is
electrification. While there are other tactics, such as using biofuels and
renewable natural gas, at this time none can scale to the degree
electrification can. The advantage of electricity is that it can be generated
from zero-emission, renewable sources such as wind, solar, geothermal, and

An effective GHG emission reduction plan in California will have
to address transportation, especially passenger vehicles, which represent 28
percent of emissions statewide. Electric mobility is coming, and it can’t
happen fast enough. Electric vehicles (EVs) are a realistic option and are
superior to their internal combustion (ICE) counterparts in many ways. The
handwriting is on the wall, and most major vehicle manufacturers either already
offer or are actively developing EVs. However you feel about EVs, you have to
give Tesla credit for disrupting the market and being the first to deliver
reliable and desirable alternatives to internal combustion vehicles.

Electric vehicles are often promoted as “zero-emission” transportation, which is a bit misleading. While it’s true that EVs have no tailpipe emissions, they still rely on electricity, which is often produced by burning things. If you can produce electricity for your EV with low or no emission sources, such as solar panels, then it genuinely is zero-emission.

However, as soon as you plug an EV into the electric grid, you need to consider the source of the electricity and how “clean” it really is. In certain parts of the country, EV emissions can be worse than internal combustion. In California, the addition of multiple renewable, low emission, or zero-emission power generation sources has transformed the electric grid into the cleanest source of energy in the state, making electrification of the transportation sector an obvious choice.

Now that we’re beginning to electrify transportation, it should
come as no surprise that buildings are next. In buildings, thermal loads (a
fancy way saying energy consumption related to heat) are the largest source of

Heating and cooling buildings, or space conditioning, takes a lot of energy. What might be less obvious is that water heating, something most of us seldom consider and often take for granted, is also a large energy user. In California today, most of the energy for space heating and hot water production is from fossil fuels, in particular, natural gas. Cooling, in most cases, comes from electrically powered air conditioning units or large chillers, both of which rely on refrigerants to move heat from one location to another.

To address GHG emissions in buildings, we need to consider the
emissions of the energy source used to manage thermal loads. As mentioned
earlier, the cleanest energy source in the state is our electric grid. Therefore,
it makes sense to electrify buildings, much like we are electrifying the
transportation sector.

In addition to reducing GHG emissions, there are other benefits
of electrification, such as efficiency and safety.

Most electric heating and cooling solutions rely on moving heat from one location to another. A great example is your refrigerator, which doesn’t generate cold air; instead, it removes heat.  As the name implies, a refrigerator uses refrigerant to move hot air from inside an insulated box to the floor of your kitchen. This transfer of heat is managed by a small pump called a compressor and the flow of refrigerant. The entire device, including the compressor, heat exchangers, and the refrigerant, is called a heat pump. Heat pumps are a very effective way to move heat. Another example of a heat pump is an air conditioner. Air conditioners work the same way as a refrigerator; the difference is the volume of heat they move and the location. Air conditioners use refrigerant to transfer hot air from inside your home to outside, thus cooling the space down.

The real benefit to heat pumps is they can be more than 100
percent efficient. If the heat pump can move more heat than the energy it
consumes, mostly from powering the compressor, it is over 100 percent efficient.
Modern heat pumps are commonly 300 percent and more efficient. In some advanced
applications, they are achieving nearly 500 percent efficiency! In contrast,
the combustion process can never be 100 percent efficient, which boils down to
physics, as there are always by-products to combustion.

As you can imagine, using high-efficiency heat pumps to meet
thermal loads in buildings will have a significant impact on energy consumption
and, therefore, emissions. Another advantage of electric heat pumps is safety,
as there is no on-site combustion.

So, what are the most logical policy steps a state should take to
reduce greenhouse gas emissions from buildings? The first is to eliminate or
discourage fossil fuels and on-site combustion. The next step is to encourage
the use of the most efficient heat sources available for thermal loads - which
we have previously identified as heat pumps. And finally, policymakers should
promote on-site electrical production from renewable sources such as wind and

The good news is, this is the policy direction we’re seeing now in California. Heat pump water heaters are getting a ton of attention and dollars these days. I often refer to them as the gateway to electrification. Heat pump space conditioning is more complicated due to sizing and ductwork but is nonetheless a time-tested technology. And finally, we have to state the obvious and include energy efficiency in the mix, as the cleanest energy available is the energy you don’t consume.

Hopefully, this will help make sense of what is happening at the
state policy level and why electrification is such a priority. 2030 is not far
away, and it will take an all options approach to meet the GHG reductions
outlined in SB 32.

If the earth were the size of a basketball, the entire atmosphere, that we depend on for life, would be as thick as a layer of plastic wrap. Think about that for a moment. The days of burning things and dumping the waste products into our atmosphere must stop unless we all want to live on another planet. Transitioning off fossil fuels and encouraging electrification will be a crucial strategy for reducing our impact, and we need to embrace this trend.

What are your thoughts? Email us at

Charles Cormany
Executive Director
Efficiency First California