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This article originally appeared in Stateline.
A 60-mile pedestrian and cycling trail in Arkansas, an electric street sweeper in Oregon and truck parking facilities in Florida don’t appear to have much in common — let alone any similarity with a conversion of California highways to toll roads or a roundabout in Michigan.
But all of the projects will be paid for by the Carbon Reduction Program, a five-year, $6.4 billion federal program to reduce the tailpipe emissions that contribute to global warming. The program, known as the CRP, was authorized in the 2021 Bipartisan Infrastructure Law, the $1.2 trillion federal investment in everything from roads and bridges to the electrical grid.
The CRP is small in comparison to, say, the infrastructure law’s $40 billion pledge to fix the nation’s bridges. Yet it could be mighty for bringing to life what are known as transportation alternatives, or small-scale infrastructure designed to take cars off the road and therefore reduce emissions. They include sidewalk installation and improvements, pedestrian walkways, bike lanes and trails, and bike share programs.
It takes much less money to make an impact on transportation emissions with such programs, said Kevin Mills, vice president of policy at Rails-to-Trails Conservancy, which advocates for money for walking and bicycling trails and has been keeping a close eye on how the CRP will boost funding for its priorities.
“This program has a big purpose and not a great amount of money given the task before us,” Mills said. “What becomes important is that we make the most of what’s a fairly modest-sized new program so that we can prove its value and hopefully grow it going forward. That puts a premium on things that will give you a big bang for the buck.”
While the broader infrastructure bill was under consideration, many U.S. House Democrats wanted it to devote even more money to climate change-related measures and less to highway projects. After it passed, 16 Republican governors grumbled about an internal Federal Highway Administration memo that encouraged states to emphasize existing repairs, public transit and bike lanes over projects to expand highways.
In the coming weeks, states must submit carbon reduction strategies that demonstrate how they’ll use federal money to reduce transportation emissions. In their strategies, states will be required to identify specific projects and approaches to reach the goals in their CRP plans, said Elle Segal, an advocacy outreach director at Rails-to-Trails Conservancy. The federal program requires that states explain by Nov. 15 how they’ll reduce emissions.
States have some leeway to shift as much as 50% of the money for carbon reduction toward other federally funded transportation projects that don’t have an explicit greenhouse gas reduction component. Some states have done just that, to the disappointment of climate activists and progressive transportation planners. (States also can transfer money from those other federal formula programs to the carbon reduction program.) In some cases, a transfer is a temporary measure and money will shift back; dollars for carbon reduction began flowing to states a year before the carbon reduction strategy plans were due and some states hadn’t yet outlined their priorities for cutting emissions.
In Maryland, the state is focusing on three areas to reduce transportation sector emissions, said Deron Lovaas, who leads the Environment and Sustainable Transportation program for the Maryland Department of Transportation. The most pressing strategy, he said, is to increase the number of electric vehicles on the road, beginning with cars, sedans, pickup trucks and SUVs, followed by medium- and heavy-duty vehicles. That includes steering federal money to electrify the vehicle fleet used by state and local governments.
Up next is reducing overall traffic or vehicle miles traveled. That involves an “array of measures,” Lovaas said, including investments in public transportation, such as rail, bus and shuttle service, and making sidewalks and roads safer for bicyclists and pedestrians and those in wheelchairs.
It’s critical that states go on the record about what they’re doing with their carbon reduction strategies, he said. That will allow states to learn from each other and will provide accountability for how federal money is being spent to reduce greenhouse gas emissions.
“It’s an important document because carbon reduction from transportation is challenging and requires a multi-year strategy,” Lovaas said. “So that’s how we’re seeing this document. We’re seeing it as important not just for informing the Carbon Reduction Program, but also reflective of Maryland’s broader strategy to decarbonize transportation.”
Many states — including California, Colorado and Massachusetts — already had laws in place that address transportation emissions. Washington’s approach to its CRP strategy, for example, builds upon its 2021 State Energy Strategy. In Oregon, the state’s Carbon Reduction Strategy evolved from its 2013 plan to reduce carbon emissions by 2050 and a statewide transportation strategy that was updated this year. Statewide greenhouse gas emissions goals are codified in state law and executive order in Oregon, as well.
“We built the carbon reduction program on that strong base of actions,” said Brian Hurley, a mitigation program manager with the Oregon Department of Transportation. “We did not have to start from scratch.”
A description by the Minnesota Department of Transportation may best reflect a hard truth in many parts of the country when it comes to carbon reduction policies, regardless of political affiliation: “Land use patterns and unsafe, inconvenient alternatives make driving alone the most convenient choice for many Minnesotans. Cars in Minnesota are mostly powered by fossil fuels, which emit carbon pollution and other air pollutants.”
“Some states are actually way ahead of us federally, in terms of their level of climate ambition and the creativity that they’ve brought to this and the steps they’ve taken,” Transportation Secretary Pete Buttigieg told The Washington Post last year. “Others, we’re pulling along and really working to encourage them.”
Florida Gov. Ron DeSantis, a Republican, this summer vetoed a budget provision that would have allowed state agencies to seek federal money through a U.S. Environmental Protection Agency grant to improve energy efficiency in buildings. But Florida hasn’t turned down $320.4 million in CRP transportation funding the state will receive over five years. In its Carbon Reduction Strategy, Florida plans to call for reducing single-occupancy vehicle trips as well as for making it easier to use vehicles or modes of travel with lower emissions. The state’s strategy will also call for using construction techniques with lower emissions.
Florida will use $46 million to build 26 truck parking areas with commercial EV charging stations and other amenities. Safe places for truckers to rest have long been at a premium, but the growth in e-commerce has put even more trucks on the road, further straining the parking supply. And without a place to stop for federally mandated rest periods, truckers spend additional time on the road looking for safe places to park, which means more time spewing CO2 out of tailpipes. Truck parking shortages are considered a “national safety concern” by the Federal Highway Administration’s Office of Freight Management and Operations.
Florida is also planning to invest big in its SUN Trails system, Huiwei Shen, the chief planner at the Florida Department of Transportation, said during a Rails-to-Trails Conservancy seminar earlier this year. The non-motorized, shared-use paths received a one-time infusion of $200 million from the state legislature this year.
“It’s a great time for trails in Florida,” Shen said. “It would contribute greatly towards the vision of a statewide interconnected trail system in Florida, and we want to be the No. 1 trail destination internationally.”
In Oregon, the state has $82 million to spend over five years. It set aside $13 million of that for projects in smaller cities and rural areas and for tribes; the federal program requires 65% of the money to go to larger metropolitan areas. Since the bulk of the money will go to parts of the state with more congestion, the state DOT wanted to help smaller communities make some progress on reducing carbon emissions, too, said Rye Baerg, a climate program coordinator with the Oregon Department of Transportation. Among the projects are e-bike lending libraries, solar streetlights and even electric-powered street cleaners sized specifically to clean pedestrian and bike paths so that they’re safer and therefore more attractive to users.
“We had a lot of counties, a lot of small cities, interested in charging and those types of things,” Baerg said. “I think that we saw a lot of interest in our first round of call for projects and I expect to see even more interest now that people know what types of things we’re funding and have a better sense of what the program is next year.”
The small changes add up, said Lovaas, with the Maryland transportation department. For example, if Maryland invests in a new transit line using Carbon Reduction Program money, it can multiply the effect of municipal or state policies that encourage transit-oriented development, Lovaas said. Invest in safe street programs, he added, and it reduces the number of trips people make by car and reduces their emissions.
“So for the short trips, you actually can replace them with walking or biking or rolling or some non-motorized mode,” he said. “You add all that together and you get a pretty big effect.”
Correction: Buildings account for about 40% of Minnesota’s total energy consumption. An earlier version of this story misattributed the figure to heating only.
Michael Overend and Lucy Grina love to show visitors around their home, a modest four-bedroom rambler, built in 1965 on a gravel road just north of Duluth, Minnesota.
The couple’s pride, however, did not always extend to one feature: the utility bills.
“We were embarrassed about how much heat this old house was leaking,” Overend said, “and we were cold a lot.”
Today, the couple is among a small but growing number of northern Minnesota homeowners finding comfort and savings by pairing energy-saving weatherization with an all-electric heating and cooling system known as a heat pump.
Heat pumps are highly efficient, two-in-one appliances that can both heat and cool a home, even in a notoriously cold climate such as northern Minnesota. The technology will likely be a key component of the state’s climate strategy, as buildings are a significant contributor to the state’s greenhouse gas emissions.
While still a niche, utilities, contractors, and advocates expect the technology to take off as more incentives become available and more people become familiar with what it can do.
For Overend and Grina, it started with consulting an expert on building super-efficient homes. They had raised two children in their home, but as they retired they had to decide whether to keep the house and improve its livability or buy elsewhere.
The first step was to get an energy audit, and then contractors plugged holes and added insulation and efficient windows. Eventually, the home was so tight they had to install an air exchanger to keep the air fresh and healthy. That’s standard practice in energy-efficient home construction these days.
Next came the heat pump. The systems have been around for decades, but their performance and efficiency improved by leaps and bounds in recent years. Those improvements, along with growing awareness about climate change and the hazards of burning fossil fuels indoors, have helped raise the appliance’s profile in recent years.
Heat pumps are more efficient than furnaces because they don’t make heat; they move it from one place to another, the same as refrigerators do. The outdoor unit looks essentially like a standard air conditioner. It has a coil filled with refrigerant and a fan that blows air across the coil. The indoor unit also has a coil and a fan. As the refrigerant moves through the system, a compressor pressurizes it and then allows it to expand, causing it to shift between a gas and a liquid. This enables it to absorb heat outdoors and release it inside.
In the summer, the system can be reversed, removing heat from inside more efficiently than a standard air conditioner can.
The most advanced heat pumps can extract heat from the air even on very cold days. This is because of newer, variable-speed, inverter-driven compressors. They are more efficient because they run continuously at varying speeds to match the heating or cooling load in the house, rather than stopping and starting as most furnaces do.
Overend said his system keeps the house toasty down to 20 degrees below zero Fahrenheit. There are backup electric radiators, and the system can switch automatically to the backups, but Overend said they hardly ever come on.
Overend said the new system — including removing the old furnace, installing the two heat pumps and some new ductwork, and adding the air exchanger and a new water heater — cost the couple about $25,000, and it has lowered the home’s energy use by 40%.
Savings depend on the type of system the heat pump is replacing. Homeowners who rely on propane can save as much as 30% on home heating costs; those using electric resistance (baseboard) heat can save as much as 50%, according to the Air Source Heat Pump Collaborative, a project of the Minneapolis-based nonprofit Center for Energy and Environment and major utilities in the state.
The collaborative’s manager, Rabi Vandergon, said rebate applications for heat pumps spiked in 2020 during the COVID-19 pandemic, as more people focused on home improvement. Supply chain problems slowed sales some, but numbers are up again this year, he said.
“We expect to see another jump,” Vandergon said. “People want to help with climate change, especially if it doesn’t hurt their pockets.”
Vandergon said the new systems are most valuable for rural residents currently served by propane or electric baseboard heating. The financial case is less clear to natural gas customers, but he’s excited about the rebate and tax credit programs soon to be available through the federal Inflation Reduction Act and Minnesota’s landmark 2023 energy legislation.
Homeowners can save more when they combine heat pumps with dual-fuel programs offered by some utilities. Minnesota Power, for example, offers customers a lower rate in exchange for the ability to stop the heat pump during times of high energy demand, forcing the home to switch to backup heat from another source.
Limited research and the increasing confidence of experienced installers are persuading homeowners that heat pumps really can work in cold climates.
HVAC contractor Chad Thompson has been installing heat pumps since he started Twin Ports Custom Climate just across the border in Superior, Wisconsin, 20 years ago. He’s witnessed monumental improvements in technologies and equally encouraging changes in consumer attitudes.
“The capabilities of the new units have gotten probably 10 times better over the last 10 to 15 years,” Thompson said.
Sales growth has occurred mainly by word of mouth. Things took off during the pandemic, Thompson said, while the region’s increasingly hot and humid summers have probably prompted interest, too. Others are motivated by climate change and the desire to stop burning fossil fuels.
The number of applications for utility company rebates for heat pumps in Minnesota more than doubled over four years, from just over 2,000 in 2019 to 4,600 in 2022, according to the Air Source Heat Pump Collaborative. And sales of heat pumps in the U.S. surpassed sales of natural gas furnaces in 2021, according to the International Energy Agency.
In the northeastern part of the state, Minnesota Power is bullish on heat pumps, offering rebates for the last several years. The company holds annual training events for contractors to learn from experts and manufacturers, and it requires customers to use preferred contractors to get a rebate.
“We want to encourage customers installing electric heat to do something that’s high efficiency, something that’s beneficial to the grid,” said Minnesota Power’s Jon Sullivan, lead worker in customer programs and services. “This technology really helps us along the path to 100% carbon-free energy. It’s also beneficial for other customers who want to cut back fuel combustion as much as possible.”
In 2017, Minnesota’s buildings consumed 40.6% of the total energy used in the state, according to the Minnesota Department of Commerce. Most of that comes from homes, where heating and cooling use more than half of the energy consumed. In spite of efforts to boost efficiency, energy use in buildings is increasing in Minnesota.
Advocates say switching to electric cars and appliances is among the most impactful things a homeowner can do to combat climate change. That’s because electricity is increasingly generated from clean sources. In Minnesota, all electricity sold will be required to come from clean energy by 2040.
As for Overend and Grina, they’re thinking about possible next steps, including an electric vehicle and possibly battery storage to tap during power outages.
“Ten years ago, I had no hope,” Overend said. “I thought climate change was too big for anyone — or for all of us — to solve. I’ve learned that there truly is hope. What we do as individuals makes a very, very tiny contribution to the overall picture. But we can be an important example to our friends, our family, our community.”
Vermont Gas Systems is offering to install electric heat pumps in their customers’ homes, the latest example of how state policy is nudging the utility to adapt its business model.
In order to comply with the state’s climate mandates, the utility is building a broader portfolio of thermal systems that will help both the business and its customers make the transition to a decarbonized future, said Richard Donnelly, the company’s director of energy innovation.
“We offer natural gas, energy-efficient products, weatherization, renewable natural gas, heat pump water heaters, and now heat pumps,” he said.
Expanding its offerings also puts the company in a good position to comply with the state’s new Clean Heat Standard, which became law last week after the legislature overrode a veto by Republican Gov. Phil Scott. Once implemented in 2025, the law will require fuel dealers to reduce the amount of fossil fuel they sell over time, or earn “clean heat credits” by doing things that offset building emissions, such as weatherization services and installing heat pumps.
Under the new heat pump program launched this month, the state’s only natural gas utility will use its in-house service technicians to install centrally ducted, cold-climate heat pumps in qualifying homes. The highly efficient systems use electricity, rather than fossil fuels, to heat and cool homes.
Customers will be able to either buy or lease the systems at rates that factor in the heat pump rebates available through the state’s utilities in partnership with Efficiency Vermont.
“We’ll process that rebate up front for a purchase, and bake it into our lease prices as well,” Donnelly said.
Each system will use the home’s existing ductwork, and be integrated with the homeowner’s gas furnace, which will serve as a backup heating source during extremely cold weather. A smart thermostat will automatically switch back and forth between the heating sources according to the customer’s settings.
“We are offering our customers an opportunity to diversify their heating system, adding in the benefits of resiliency,” Donnelly said. “This is also an opportunity to reduce their carbon footprint.”
In order to qualify, homes must already have ductwork that delivers heat through vents. They must also have a fairly efficient furnace.
An estimated 14,000 of the utility’s 55,000 customers could be eligible. Most homes in the company’s service area have hydronic heating systems with radiators or baseboard radiators; Donnelly said the company will begin offering heat pump solutions for those customers in the future.
The new program comes just over a year after Vermont Gas announced it would begin installing electric heat pump water heaters for its customers. The company is also looking for a site to test its first fossil fuel-free networked geothermal project, another possible business to branch into as the state moves away from fossil fuels.
“As a distribution utility, energy efficiency utility, and integrated energy services provider, Vermont Gas is uniquely positioned to help its customers take advantage of the latest and most cost-effective technology,” said Dylan Giambatista, the company’s public affairs director.
Vermont’s climate mandates call for reducing greenhouse gas emissions by 26% from 2005 levels by 2025, 40% from 1990 levels by 2030, and 80% by 2050.
“We are going to need a lot of different partners” to meet those goals, said Johanna Miller, energy and climate program director for the Vermont Natural Resources Council. “To the degree that our utilities like Vermont Gas will lean into and help their customers cut costs and cut carbon, I think that that is important.”
Gas heating customers switching to electric heat pumps won’t necessarily save money, at least for now. While the heat pumps are more efficient, gas is currently the cheaper source for heating, Donnelly said.
But the company is developing an online calculator that will allow customers to see how setting the system to swap over to the furnace at 20 degrees versus, say, 25 degrees will compare in terms of carbon reduction and heating costs. They will also be able to measure the carbon and cost impact of adding in renewable natural gas.
“A lot of our customers are motivated by carbon reduction, but they don’t know how much a heat pump would help in terms of their overall consumption,” Donnelly said. “We’re taking that role to educate.”
Giambatista said he installed a heat pump in his 1945 house last fall. He set the smart thermometer to swap over to his gas furnace when temperatures dropped to 25 degrees. Over the winter his gas usage dropped by about 60% compared to previous years, he said.
To date, about 45,000 ducted and ductless heat pumps have been installed in Vermont under the state’s rebate program, according to Phil Bickel, HVAC and refrigeration program manager at Efficiency Vermont.
They are primarily in homes that heat with fuel oil, the majority of homes in the state.
“We’ve seen the cost of all fossil fuels go up and down over the years,” Bickel said. “The main thing about making the switch to heat pumps is it provides a little bit more of a stable cost. They are three times more efficient than oil or propane, and they also provide the low carbon benefit, as well as the cooling benefit.”
Efficiency Vermont does recommend that homeowners maintain a backup source for heat. The heat pumps work well down to about -15 degrees, “but in Vermont, there are those times when we are going to have a long cold snap,” Bickel said.
The following commentary was written by research and modeling manager Rachel Goldstein and modeling analyst Daniel O’Brien of Energy Innovation Policy & Technology LLC. See our commentary guidelines for more information.
California’s new clean-vehicle policy will transform the world’s second largest car market, drive a nationwide electric vehicle (EV) revolution, save consumers money, and clean the air. New Energy Innovation Policy & Technology LLC research shows if the 16 “Section 177” states follow California’s plan to phase out fossil-fueled car sales by 2035, EVs could compose more than 80 percent of all new car sales across the United States in 2050.
This accelerated EV transition could extend this policy’s benefits far beyond California, creating hundreds of thousands of new jobs, preventing thousands of pollution-induced deaths, saving drivers hundreds of dollars every year, and cutting the greenhouse gas equivalent of removing an entire year’s worth of today’s car emissions.
Section 177 of the U.S. Clean Air Act allows California Air Resources Board (CARB) to enact more stringent emissions standards than those set by the U.S. Environmental Protection Agency. In August 2022, CARB approved the new Advanced Clean Cars II rule (ACC II) requiring all new cars sold in the state be zero-emission vehicles (ZEV) by 2035. California sells more cars and trucks than any other state, driving major implications for nationwide car sales and transportation emissions.
The Clean Air Act also allows other states to “piggyback” off California’s standards, helping cut emissions from vehicles inside their borders — 16 states have opted to follow earlier cleaner car standards. These Section 177 states and California make up 38 percent of the U.S. auto market, meaning ACC II adoption could transform how Americans drive. While some states automatically adopt new CARB rules, others, like Maryland, New Jersey, New Mexico, and New York require proactively adoption via legislation, executive order, or regulatory action.
Energy Innovation modeled the impacts of the new ZEV rule using its free, open-source Energy Policy Simulator model. The results showed that if all 17 states adopt ACC II, annual U.S. transportation emissions could fall 53 percent by 2050 versus today’s levels, equivalent to avoiding the emissions of 13 coal plants operating for the next 30 years.
CARB’s decision followed the 2022 Inflation Reduction Act (IRA), which extended and expanded the federal EV tax credit up to $7,500. The IRA eliminated a restriction that only automakers that have sold less than 200,000 EVs can qualify for the credit and created a separate $4,000 tax credit for used EVs.
These incentives will drive consumer demand in the near term, while spurring domestic battery and EV manufacturing. But overcoming long-term adoption challenges requires ZEV standards. Following the tax credit expiration in 2032, annual EV sales could fall to pre-IRA, business-as-usual levels without ACC II adoption.
Drivers of fuel-burning cars are handcuffed to volatile gas prices. Gas prices fluctuated as much as 25 percent since 2022, largely due to Russia’s invasion of Ukraine. OPEC and Russia recently announced plans to cut 1.6 million barrels of oil production per day by the end of 2023, aiming to push prices even higher.
EVs are already cheaper to finance and own than gas-powered vehicles the day they are driven off the lot in most states, even if they have a higher sticker price. EVs need less maintenance and charge on the electricity grid, which has greater price stability and lower prices than the oil market. Previous Energy Innovation modeling found EV owners average $6,000 in savings over the vehicle’s lifetime thanks to lower fuel and maintenance costs.
If all 177 States adopt ACC II, U.S. households could save an average of $238 annually, with savings concentrated in states that adopt the standard and offer robust EV incentives. For example, households in in New Jersey, which boasts one of the country’s highest EV tax incentives, could save $682 every year when the state implements ACC II.
ACC II adoption in all 17 states could also create more than 300,000 jobs nationwide through new EV supply chain and domestic manufacturing facilities investments.
National economic changes due to ACC II as compared with an IRA baseline
Shifting away from fuel-burning vehicles will also cut toxic nitrogen oxides, volatile organic compounds, and particulate matter emissions which harm human health. Air quality improvements from ACC II could prevent as many as 160,000 asthma attacks and 5,000 deaths nationwide by 2050.
Improved public health will feed back into the economy. In New York, adopting the ACC II rules could prevent up to 55,000 health-induced lost workdays. These benefits will be particularly prevalent in communities of color, which experience pollution-related health impacts at significantly higher rates than the national average.
With model ZEV standards ready to adopt, state policymakers can floor it toward an electrified transportation future, delivering considerable benefits for their residents. But complementary policies are critical to ensure rapid EV adoption. Each state can further support EV market growth by developing charging infrastructure, offering state incentives for EVs, and hosting supply chain manufacturing facilities.
EV adoption is still contingent upon the buildout of a widespread, equitable charging network that ensures access to quick charging. Coordination between state and local governments, utilities, and the private sector can help build out charging infrastructure across all neighborhoods and help overcome a major obstacle to EV purchases in rural areas.
State policymakers should pair IRA tax credits with state incentives to make EVs even more price competitive. Means-based rebates and tax credits, like those in California’s Clean Cars 4 All program, should be funded to support EV access for low- and middle-income communities. Policymakers can also support the growth of their EV markets and bring more jobs home by incentivizing EV supply-chain manufacturing to their states. These facilities can bring new jobs and sources of tax revenue to their communities.
Vehicle markets are rapidly moving towards EV adoption, and states with supporting policies will be best positioned to take advantage of the benefits. ACC II will accelerate that transition, driving down carbon emissions and other tailpipe pollution while saving customers money. State lawmakers should move swiftly to adopt the ACC II rules — any delay forgoes jobs, savings, and cleaner air for their residents.
New electric vehicle rebates are expected to become available in Massachusetts in early summer, some nine months after lawmakers passed a bill calling for the incentives’ immediate implementation.
The state has said funding and logistical obstacles have delayed the launch of the new provisions, which will add higher incentives for low-income car buyers, create a rebate for the purchase of used electric vehicles, and establish a system for providing rebates at the point of sale, lowering the upfront cost of the vehicle.
Advocates have been understanding of the complications with rolling out these provisions but are eager for the new components to take effect.
“I am sympathetic, but if we want to hit not our climate goals — our climate requirements — we really need these coming online as soon as possible,” said Kyle Murray, Massachusetts program director at climate nonprofit the Acadia Center.
Massachusetts has ambitious goals for reducing its transportation-related greenhouse gas emissions. The state’s clean energy and climate plan sets a goal of slashing vehicle emissions by 86% from 1990 levels by 2050. One of the major strategies for getting there is increased adoption of electric vehicles: The plan calls for all new vehicles sold in the state to be electric by 2035. The state has also set a target of having 900,000 electric vehicles on the road by 2030.
To those ends, the state’s electric vehicle incentives have long been considered among the best in the country. The Massachusetts Offers Rebates for Electric Vehicles program, or MOR-EV, was launched in 2014, providing rebates of $2,500 on eligible purchases or leases. For a time the rebates dropped to $1,500 due to funding issues, before returning to their original level in 2020.
The climate law passed in 2022 called for expanding these incentives in several ways. The base rebate was increased to $3,500 and the price cap for eligible vehicles was raised to $55,000, changes that have already been implemented. Other changes have been more difficult to put into effect.
Though the law authorizing the program was passed in August 2022, the legislature didn’t provide any additional funding until November.
“The administration was a bit handcuffed in that they couldn’t set up a program they weren’t sure they’d have the money for,” Murray said.
At the same time, implementing the new provisions required enough updates to the program software that the state had to put out a call for proposals from vendors to handle the changes. In March, the state chose to continue working with the existing vendor, the Center for Sustainable Energy, and the final program design is now underway with the first components rolling out this summer, according to information from the state Department of Energy Resources.
“I am hoping for a July 1 roll-out of all the new features the program requires to satisfy legislative intent,” said state Sen. Michael Barrett, a champion of the 2022 climate bill.
A new rebate will provide an additional $1,500 to low-income residents who buy or lease a qualifying vehicle, though the state is still determining details including what income levels will be eligible and how income will be verified. A used vehicle rebate and an enhanced rebate for consumers trading in a vehicle with an internal combustion engine are also expected this summer, though, again, details have not yet been released.
While advocates have generally expressed understanding for the lengthy implementation process, this lingering uncertainty has also frustrated some.
“That lack of specificity makes it really hard to help people figure out what car to buy when,” said Anna Vanderspek, electric vehicle program manager for the Green Energy Consumers Alliance. “Overall, we wish they would have moved faster and been clearer about which changes would occur when.”
A major uncertainty that remains is whether the new provisions will be effective retroactively, considering the delays in implementation. Barrett is a strong proponent of retroactive rebates.
“We passed a new law last year with an immediate effective date,” he said. “I think consumers had a right to rely on the statute we wrote.”
Vanderspek, however, does not like the idea of retroactivity. Anyone who bought an electric vehicle since last August clearly did not need the state-sponsored financial incentive to do so, she noted. It makes more sense to use the finite pot of rebate money to help nudge new consumers toward clean vehicles, rather than paying out for cars already on the road, she said.
Whatever form the new provisions take, a variety of factors beyond the state’s control will also affect how quickly electric vehicle adoption accelerates. Supply chain shortages have been making it more difficult for eager buyers to acquire electric vehicles. A generous $7,500 federal incentive in the Inflation Reduction Act sparked optimism, but the Treasury Department announced last week that just 14 models are eligible for that tax credit.
Still, Murray is confident that the combination of public sentiment, state incentives, and federal tax credits will soon make a measurable difference.
“We’re definitely going to see it really start to tick up,” he said.
A tribal clean energy developer hopes an electric vehicle infrastructure grant can help two Upper Midwest reservations move forward after recent pipeline battles.
Bob Blake is executive director of the nonprofit Native Sun Community Power Development and a member of the Red Lake Band of Chippewa (Ojibwe) Indians in northwest Minnesota. His organization will share a new $6.7 million federal award with another group serving the Standing Rock Indian Reservation, a few hundred miles southwest along the North and South Dakota border.
“[Fossil fuel companies] are going to build oil pipelines, and we’re going to build an EV charging network pipeline,” Blake said. “We’re going to build the future as they build the past.”
The money, from the U.S. Department of Energy’s Vehicle Technology Office, will be used to purchase vehicles for both tribes, as well as to install more than 120 charging stations linking tribal lands, tourist byways and regional hubs.
The project brings potential economic benefits, a chance to improve energy self-sufficiency, and a “different narrative” for communities that have been consumed by pipeline protests in recent years, Blake said. Standing Rock was the site of massive 2016 protests against the Dakota Access Pipeline, and Red Lake was a focal point in this year’s fight against Enbridge’s recently completed Line 3 replacement project.
The EV infrastructure is part of a larger strategy to move to self-power the reservations with wind and solar. The Red Lake Band has several solar installations on government buildings installed by native contractors led by Blake and solar entrepreneur Ralph Jacobson. A Standing Rock entrepreneur built North Dakota’s first major solar array, and the tribe’s renewable energy authority is raising money for a 259-megawatt wind farm.
Clean energy jobs and training could help Standing Rock’s struggle with high poverty and unemployment rates, said Joe McNeil, general manager for the Standing Rock Renewable Energy Authority. Chargers at casinos would serve the growing number of visitors driving electric vehicles, he said. Standing Rock may buy electric buses to shuttle people around the reservation but will not use them to pick up casino patrons in Bismarck or Fargo because charging could cause timing issues, he said.
Native Sun and Standing Rock Renewable Energy Authority will install 59 fast chargers and 63 slower-charging Level 2 stations. Blake said he wants stations placed at popular spots on reservations and in smaller towns between destinations where charging hubs might spur other economic development.
“It’s going to be an economic force, especially in these impoverished areas,” Blake said.
The grant money will also be used to purchase 19 electric vehicles for use by tribal governments and pay for outreach that includes 52 events over the next three years. Blake said the vehicles would consist of school buses and public transit vehicles to transport tribal members to medical or other appointments within the reservation. The tribes and several partners will study how they operate in a climate that can be severely cold in winter.
ZEF Energy will build the charger network. Megan Hoye, vice president of business development, said the grant would expand Minnesota’s charging network built with money from the Volkswagen settlement. The tribes’ plan expands the state’s charging network farther north and allows cost-sharing to install faster chargers at some sites, she said.
Hoye said the inter-tribal network will invest significantly in fast chargers instead of slower and more common Level 2s in the Upper Midwest. The faster chargers, she said, will better meet consumer expectations. As Minnesota’s charging network enters a second phase, money from the tribal network could enhance existing charging hubs and make them “faster chargers or even ultra-fast chargers,” Hoye said. “There’s an opportunity for a kind of synergy.”
The inter-tribal network brings other benefits. Hoye said the network will help, especially in North or South Dakota, neither of which have well-established charging networks. The plan calls for some Level 2 chargers at government buildings in preparation for potential fleet electrification.
Lester Shen, senior research engineer at the Center for Energy and Environment, worked on the grant and will assist with data collection. The routes chosen for charging hubs connect lesser served areas that should spur greater EV adoption and match well the Biden administration’s efforts to spread transportation electrification to even remote outposts, he said.
Among the barriers to more EVs has been a lack of chargers and the distance between them, Shen said. However, the investment in chargers allows drivers more options in remote areas. “The reality is transportation drives the economy,” Shen said. He added that the investment should also spur more community college training to prepare students for jobs in the industry.
Both Blake and McNeil agree that EVs offer training and employment opportunities. They have been working with local tribal community colleges on wind and solar jobs training and have plans to ask them to add EV courses. In addition, McNeil wants a local community college involved in data collection on vehicle performance that the tribe can share with car dealerships in the region selling EVs.
Jon Hunter, senior director of clean air at the American Lung Association, also worked on the grant proposal. He said challenges remain, including a need to ensure tribal chargers will not overlap but augment the charging plans developed by Minnesota Power and Otter Tail Power. These utilities serve areas where the tribes may want to operate chargers.
The proposal also has environmental benefits. “This is a great opportunity to demonstrate the benefits that electric vehicles offer to drivers and fleets while also reducing harmful tailpipe emissions that can cause problems for people with respiratory diseases like asthma and chronic obstructive pulmonary disease, which are often more common in Indigenous Peoples,” Hunter said.
Since the Dakotas stand near the bottom in EV adoption rates and rural communities have yet to embrace EVs, outreach will be a priority for the project. Hunter said the American Lung Association would support the tribal outreach efforts as the project moves forward through ride-and-drives and other activities.
For Blake, the pipeline protests served a purpose in enlightening people to the environmental degradation and continued reliance on fossil fuels that result from pipeline construction. Now, he wants the EV project to fight climate change in a different way. “This is about jobs, workforce development and giving people opportunities they never had before,” he said. “Those tangible things, to me, are very, very important.”
A coast-to-coast electric vehicle road relay recently stopped in Cleveland and highlighted the need for equity in the transition to electric vehicles.
Drive Electric Northeast Ohio welcomed the Route Zero Road Trip for its June 11 stop at the new headquarters of the Cleveland Foundation.
The foundation chose the location to promote equitable growth in the Midtown and Hough neighborhoods, a historically redlined area where a majority of residents are Black and median household incomes are less than half of Ohio’s statewide median.
The Route Zero Road Trip is an electric vehicle tour from Los Angeles to Washington, D.C., that began last month. Drive Electric Northeast Ohio worked with the Cleveland Foundation to host the stop at the foundation’s new headquarters, which features a solar-powered carport, to draw attention to the neighborhoods and the importance of making sure that people at all income levels can take advantage of the shift toward electrification.
“We believe everyone should be able to access EVs and to have a clean energy charging infrastructure providing benefits beyond just a clean, quiet, fun ride,” said Michael Benson, vice president of Drive Electric Northeast Ohio. He’s also a co-owner of Command Consulting, a Wadsworth firm that advises on electrification, microgrids and shared services.
Beyond being electric car enthusiasts, Drive Electric Northeast Ohio focuses more broadly on electrification, Benson said, particularly the “chicken-egg problem of EVs and EV charging.” Ideally, he said, batteries could store electricity from solar arrays, which then could charge electric vehicles.
Both solar energy and the development of electric car charging in the area appealed to Keith Benford, who attended the Route Zero Road Trip event and said he lives in the Midtown-Hough neighborhood.
“It’s the new technology. They’re going with all-electric cars. And we can kind of capitalize on that by having charging stations in our area, and having the solar arrays.” Benford said. “We’ve got a lot of building that’s going to happen around here in our neighborhood. And that would be a perfect opportunity when the buildings come up to have solar.”
People in the Hough neighborhood have already shown interest in developing clean energy. The Hough Block Club has been working for several years to develop a community-based solar array in the area.
“Everyone in that group is committed to the project, but the timeline is getting stretched out a little bit longer,” said Jonathan Welle, executive director of Cleveland Owns, which has provided technical assistance to the Hough Block Club. While there’s no definite date for completion, the Hough Block Club had an environmental assessment completed earlier this year, Welle added.
Neither Cleveland Owns nor the Hough Block Club organized the electric car event on June 11. Yet Welle agreed that Hough and other disadvantaged neighborhoods should be at the table as electrification, the move to electric vehicles, and other parts of the clean energy transition continue.
The neighborhood “has been a center of disinvestment and capital strike for decades, due to racism and systemic injustice,” Welle said. So, he added, residents there can help create a new system to avoid those problems.
The City of Cleveland’s Office of Sustainability & Climate Justice also is working to get more electric vehicle charging capacity in the city’s neighborhoods. A charging station opened last fall at the Frederick Douglass Recreation Center in the Lee-Harvard neighborhood. The Cleveland Foundation’s chargers are currently available only to staff and visitors.
Several others are in the works, said Elizabeth Lehman, who is the built environment project manager at the city’s Office of Sustainability & Climate Justice. Two stations with a total of four ports will be at the Canal Basin parking lot near the Cuyahoga River. A station with two ports will go in at Cleveland Hopkins Airport’s red lot. And charging stations for the West Side Market and the downtown Willard Garage are part of a recently approved project by the Northeast Ohio Area Coordinating Agency, whose list of planned charging sites also includes dozens more locations throughout its five-county planning area, including several Cleveland Public Library branches.
Additionally, the city of Cleveland requested bids earlier this year for installing electric chargers throughout the city. “We hope to have a vendor selected soon,” Lehman said. “This project will also help us to determine the total number of stations that we hope to have available citywide over the next couple of years.”
The city’s bidding documents note that preference will be given to contractors who plan to work in communities that are marginalized, underserved and overburdened by pollution, based on the federal government’s Climate and Economic Justice Screening Tool. The tool shows most areas in the city are disadvantaged and would qualify under the criteria.
Preference will also go to contractors who can propose a no-cost or low-cost rate structure for low-to-moderate income consumers, specifically for those who use charging stations within the city’s business districts, the bidding materials said.
A March addendum to the bidding materials also noted the city’s intent to support the winning bidder in pursuing federal funding under the Bipartisan Infrastructure Act. The Joint Office of Energy and Transportation’s website currently shows July 28 as the deadline for some of those grants.
A small but growing number of Minnesota electricians are finding steady work installing residential electric vehicle chargers.
Minnesota has around 35,000 electric vehicles on the road today, but that number is expected to rapidly grow in the coming years as more models become available. The state is using federal funds to help build out a public charging network along major highways, but even so, research suggests most drivers are likely to mostly charge at home.
Some will simply have to plug into an existing outlet in their garage, but many will need electrical upgrades, especially those with older homes or those who want to take advantage of faster charging times. Participating in certain utility programs may also require the installation of new equipment.
That’s creating an opportunity for electricians like Adam Wortman of St. Paul, who installed an electric vehicle charger at the home of a clean energy advocate four years ago and has since retooled his business to focus almost solely on similar projects.
“It’s where I see the demand,” Wortman said, “and from a business standpoint, it’s nice to have a specialty,”
It’s unclear exactly how many electricians have decided on a similar path, but anecdotally it’s more than a few. The International Brotherhood of Electrical Workers Local 292 has trained and certified more than 400 electricians over the past two years to install commercial electric vehicle chargers along state and federal highways, but residential installations are more commonly non-union contractors.
“What I’ve seen is that with more electric cars and with more of the demand for electric car chargers, a lot of these smaller shops seem to be picking up work,” said Andy Snope, business representative and legislative and political director for IBEW Local 292. “They are getting a niche and a reputation.”
The market for electricians installing vehicle chargers is bifurcated into commercial and residential projects. He and others estimated that dozens of electrical firms install chargers, but just a handful focus primarily on chargers. Firms attract jobs through word-of-mouth advertising and references from vehicle manufacturers or utilities such as Xcel Energy.
“It seems like kind of an underworld niche for electrical contractors who are usually smaller but are getting a lot of this work, which is great for a small business,” he said.
Paul Hanson, energy service sales representative for Connexus Energy, said the cooperative recommends that customers getting vehicle chargers reach out to Wortman and a handful of other contractors who specialize in installations and have had good reviews over the years. Hanson said he’s started hearing from solar and heating and cooling companies that want to get on the utility’s list of preferred charging installers.
“Everyone is trying to get their hand into the electric vehicle market,” Hanson said, adding that Connexus saw a 90% increase from 2021 to 2022 in members enrolled in its off-peak vehicle charging program.
Electricians working on vehicle chargers generally gain their first experience working with Tesla, which had the first electric vehicles on the market. Many electricians bought Teslas early and discovered other buyers were struggling with firms that knew anything about chargers.
Bryan Hayes, founder and owner of Bakken Electric LLC, bought a Tesla in 2012 and moved from providing general residential electrical services to installing vehicle chargers. Though Hayes had been an electrician for two decades, he wanted a change.
“My reason for doing it was more ideological,” he said. “I wanted to do something that leaves a legacy of making the world a little better place than I found it.”
Hayes built a staff of six electricians who have installed over 4,000 chargers in the Twin Cities region, ranging from garages to apartment buildings to downtown Minneapolis ramps. His projects come from recommendations from electric vehicle manufacturers and word-of-mouth advertising.
One area of growth has been installing chargers in multifamily buildings. Hayes created a separate company, U.S. Charging, to partner with Tesla to install its commercial chargers in multifamily buildings. “Condominiums and apartments [and] hotels are now a big focus of my business,” he said.
St. Paul-based Sherman Electric owner Jim Sherman has installed thousands of vehicle chargers and collaborated with Xcel Energy on its Accelerate at Home charging program several years ago. Installations represent 40% of his business, with working at restaurants a second specialty.
“I think the market is getting more specialized and more niche than ever,” Sherman said. “I know contractors that only work on hospitals, and I know contractors that only do apartment buildings.”
Part of the specialization comes from building codes that have become stricter and more demanding. Sherman and his staff of four assistants developed expertise and an understanding of building codes by concentrating on vehicle charging and a handful of other industry sectors, primarily restaurants.
The charging sector is new enough that inspectors often call Sherman with questions and situations they encounter. Homeowners who suffered poor installations pay him to correct the mistakes.
The biggest challenge lately has not been codes or charger technology but instead educating newer EV customers. The early electric vehicle buyers had few questions because they had done their homework and understood the technology.
“My average phone call now is about 20 minutes to sell a customer because I have to educate them about how [the charger] works, how the cars work, how the cars charge, how the power works — everything,” Sherman said. “The early adopters, the Tesla people, knew their stuff. Now it’s getting to be a wider, broader range of people driving electric vehicles.”
In the Twin Cities, home and multifamily building owners typically pay $2,000 to $3,000 to install a Level 2 charger, which provides from 20 to 50 miles per charging hour. Level 1 charging, in contrast, requires a common outlet and no electric system upgrade but charges vehicles at just two to five miles per hour.
Wortman said Level 2 chargers can require homeowners with attached garages to add another circuit to their electric panels. He installs a separate meter for detached garages and usually upgrades the building to a 240-volt system. Then, typically, he has the homeowner pay Xcel or their utility to drop a line from its transmission grid to power detached garages.
While there’s no average day for Wortman, he usually has two to three installations lined up. Many times, he and other electricians will pick up small jobs like changing out or adding plugs or other repairs in addition to installing chargers.
Clients say electricians are hard to schedule for smaller jobs and are happy to pay them to do extra work, he said. He and other electricians also consult with clients on federal tax and utility rebates they can use to reduce their costs.
Multifamily apartments and condos present different obstacles. Electricians sometimes must connect chargers to the electric systems of clients living several floors above the garage. Or they work on managed charging that moves electricity around to different cars, a common solution to serve the growing number of EV drivers living in apartments and condominiums.
Hayes has directed much of his business to working with multifamily clients and Wortman and other electricians see it as the next frontier.
Despite continuing a lawsuit over the state’s clean car standards, the Minnesota Automobile Dealers Association recently hired an electric vehicle program director.
The organization believes it is the first dealer association in the country to add a staff member assigned explicitly to electric vehicle issues. Its vice president of public affairs, Amber Backhaus, said the position developed over the past two years as demands by dealers for expertise and information on electric vehicles grew.
Backhaus said the dealer association does not agree with “supply side mandates,” but does not see that as contradictory to preparing for the market shift that is already well underway.
“Electric vehicles are the wave of the future and our dealers are excited to sell them, but there are a lot of things they need to do to prepare to be able to sell them,” she said. “We get a lot of questions from dealers and we thought it would make sense to bring somebody in-house who could put together those resources and answer their frequently asked questions.”
The association selected Steve Nesbit, a former executive who oversaw electric vehicles and renewable energy programs at an electric cooperative and worked at an auto dealership. Nesbit said he sees his role as helping dealers “support the sale of electric vehicles and keep their business model operating.”
Nesbit worked for Wright-Hennepin Cooperative Electric Association for 12 years, focusing on renewable energy and community solar for part of his time there. Before taking the association job, he worked for an energy technology company and an auto dealer.
The association has been a long-term member of Drive Electric Minnesota, an initiative of the Great Plains Institute. M. Moaz Uddin, a policy specialist at the institute, said the addition of Nesbit will help “bridge the gaps between dealerships and utilities” and make for a smoother transition to vehicle electrification.
While electric vehicles will play a crucial role in decarbonizing transportation, they will not be the only solution. Minnesota needs to continue efforts to create low-carbon fuels and communities where residents can walk or use transit, bicycles and other transportation modes instead of cars, Uddin said.
Nesbit starts his role as the association continues fighting the state’s clean cars standards in a case heard in November at the Minnesota Court of Appeals. Last year, Minnesota adopted the clean cars standards developed by the California Air Resources Board, a move requiring dealers to make more electric vehicles available starting in 2024. The Minnesota Pollution Control Agency oversees the new rule.
Auto dealers and Republicans have criticized the Walz administration’s embrace of the California model. The federal government only permits California to have its own auto emission regulations. However, it allows other states to follow the Golden State’s rules or those of the U.S. Environmental Protection Agency.
More than a dozen states have embraced the tougher rules, but California’s decision to ban the sale of internal combustion engine vehicles in 2035 has left several states, including Minnesota, debating whether to return to the federal standard. Backhaus expects the appeals court to release a decision early next year, which comes after the association lost an earlier challenge in federal court last year.
Fresh Energy, which publishes the Energy News Network, is one of six organizations that have signed on to a brief of amici curiae in support of the tougher standards. Fresh Energy policy staff do not have access to the Energy News Network’s editorial process.
Both Backhaus and Nesbit say the lawsuit does not diminish the association’s embrace of electric vehicles nor its desire to help members overcome challenges. Dealers may not like the speed of the transition, Nesbit said, but they understand the need to educate sales and service staff on the new technology.
They must learn how to speak to consumers about the strengths and weaknesses of electric vehicles in weather conditions in Minnesota, such as brutally cold winters that can diminish battery charges quickly, he said.
Backhaus said automobile manufacturers have begun requiring dealers to have chargers onsite and new equipment in repair shops. Dealers will need new lifts — because electric vehicles weigh more than internal combustion vehicles — and a retraining program for their mechanics. Ford recently announced new requirements could cost individual dealerships $1.2 million in upgrades, she said.
Minnesota dealers work with 65 different investor-owned, cooperative and municipal-owned utilities, Backhaus said. Some utilities, especially those owned by municipalities, have little experience with electric vehicles or chargers. Auto sellers will need onsite chargers, as will their clients.
“Hopefully, we can also educate utilities serving our dealers, so this is a smooth transition,” Backhaus said.
Tom Leonard, incoming chair of the association and president of Fury Motors in the Twin Cities, has become a big fan of electric vehicles and of the association adding a staff expert devoted to training, education and advocacy. The lawsuit, he conceded, may have led Minnesotans to believe dealers don’t want to sell electric vehicles.
“That’s a massive misperception that has been maybe played more in the media than in the car dealership world,” he said. “Car dealers are very pro-electric vehicles, zero-emission vehicles. We don’t want to be behind what’s coming at us.”
Leonard said he will have to upgrade his dealership, which sells Chrysler, Jeep and Dodge vehicles. The association has been working with manufacturers about how infrastructure charging investments work in Minnesota, for example by pointing out that state funding requires the public to have access to the equipment. Many dealerships must start installing chargers and new equipment early next year to meet 2023 car company deadlines, he said.
Backhaus said auto manufacturers have not yet created programs to help dealers pay for upgrades. The association plans to look for funding for members through federal and state sources. The Inflation Reduction Act offers a 30% tax credit from charger installations, but some of the other initiatives come with “a lot of red tape,” she said.
The association plans to continue advocating for legislation in Minnesota to offer incentives for electric vehicle purchases and develop a program to help dealers pay for upgrades. Rep. Zack Stephenson, a Minneapolis Democrat, has sponsored legislation that offers rebates for buyers and assists in helping dealers pay for programs certifying employees to sell electric vehicles.
In the next few years, Backhaus would like to see dealers have the educational background, infrastructure and services in place to sell EVs.
“We want them to be able to talk to their consumers about how [electric vehicles] work and that they’re not a scary, unknown thing,” she said.
Many individuals and households have at least one outdated appliance — a refrigerator, a water heater or a window-mounted air conditioner that they hold onto because of the expense involved with replacing them. Yet the money they save is often more than canceled out by higher utility bills.
Upgrading outdated appliances can help low-income households stay in their homes by reducing their utility bills — and by extension, lowering their overall housing costs. The money saved can be used toward other necessities such as food or transportation to work or school.
However, it can take years for a new appliance to pay for itself through energy savings. Without incentives, it often simply doesn’t make financial sense for a low-income household to upgrade outdated appliances solely to save on energy bills. This is especially true for renters or homeowners who are unsure about how long they will remain in a given location, or who are unsure about whether they can take new appliances with them when they move.
The challenge is in bridging the gap to bring the necessary up-front investment in energy-efficient appliances within reach. That’s where organizations like Elevate and Meadows Eastside Community Resource Organization, also known as MECRO, come in. They coordinate resources such as incentives offered by utilities, grants and low-interest loans, and make them available for low-income households to eliminate this dilemma.
Through its headquarters in Chicago’s West Loop, along with offices in downstate Illinois, Michigan, Missouri, Wisconsin, Oregon and California, Elevate works to help homeowners and owners of multifamily units across the country obtain financing to improve the energy efficiency in their homes and buildings. MECRO is located on the busy 79th Street commercial corridor of Chicago’s Southeast Side and focuses its services on residents in the community. (The name Meadows in the MECRO acronym is in honor of Rufus and Everlena Meadows, the parents of Sharon “Sy” Lewis, founder and executive director of MECRO.)
Through a collaboration with the City of Chicago, ComEd and Elevate, the National Renewable Energy Laboratory utilized its trademarked ResStock tool and place-based data to develop residential energy efficiency strategies for the city’s residential building stock, primarily comprised of bungalows and other single-family homes built before 1942. Through the Chicago Advanced Building Construction project, a series of simulations was executed, which generated up to $49 billion in potential utility bill savings. An especially significant finding was that sizable savings could be achieved through installing heat pumps and other off-the-shelf technologies.
An old refrigerator uses up to three times as much electricity as a newer, energy-efficient model. Energy-certified clothes dryers use 20% less electricity than a standard dryer. Certified clothes washers require between 40% and 50% less energy and 55% less water to operate than conventional washers.
Utilities such as ComEd and Ameren in Illinois provide a number of incentives for ratepayers — such as rebates for trade-ins of old appliances — to facilitate the switch for customers to energy-efficient appliances.
Elevate has a number of funders that provide grants to heavily incentivize or provide upgrades at no cost for homeowners. In addition, in areas where utility incentives aren’t in place, the Community Development Financial Institutions Fund can provide financing, according to Jackie Montesdeoca, director of building electrification for Elevate.
“There are models where we can have a lender include energy efficiency as part of the overall rehab. We do that in the Chicago area, but that’s a model that can be replicated [in other locations]. … The underwriters or the loan officers know that high-efficiency equipment or adding a little more insulation than code requires is going to make that building more resilient [with] lower operating costs, as opposed to a building that didn’t go through those measures in their rehab,” Montesdeoca said.
According to U.S. Census Bureau data cited in a 2020 report by the American Council for an Energy-Efficient Economy, utility costs for poor households averaged 8.1% of their income, versus just 2.3% of income spent by more affluent households on utility bills.
While the lion’s share of these expenditures was for heating and cooling, household appliances accounted for a significant percentage of utility costs as well.
A comprehensive energy efficiency upgrade that includes replacing outdated appliances can translate to savings of 30% or more, according to Montesdeoca.
Yet many eligible households remain unaware of these programs, or have the mistaken belief that they do not qualify, according to Lewis.
“One of the things that I really try to push is that all of these programs are available, [but there is a] lack of information. You would think somebody who lives in Beverly” — a middle-class, racially diverse community on Chicago’s far Southwest Side — “wouldn’t be income-eligible and they wouldn’t be suffering from housing insecurity. They are. It does not matter. There are very affluent neighborhoods where people are suffering. You know, it’s a lot when you’re making a hundred thousand dollars, [but] there are eight people in your house,” Lewis said.
Reducing utility bills by replacing outdated household appliances is a vital tool in enhancing housing affordability through the knock-on effect in freeing up funds that were formerly needed for those bills — funds that can be used for other necessities that enhance overall housing affordability. Even small improvements, such as installing aerators on faucets or converting incandescent lighting to LEDs, can contribute to cumulative money savings, Lewis said.
“So, with these little aerators people think, oh, that’s just something cute. No, it’s not. It is saving you water. It’s saving you gallons and gallons and gallons of water. Is it impactful? Yes, absolutely. Will it be able to keep more people in their homes? Absolutely. Because this is now an expense that they do not have to pay on their property, that they can invest on their bills, that they can invest in their property,” Lewis said.
Nonetheless, many would-be beneficiaries find it difficult to justify the expense to replace a functional refrigerator or water heater. A lack of awareness about available incentives also contributes to resistance. It’s often necessary to educate people about how the return on investment combined with available incentives and other resources actually helps them save money in the long run, Montesdeoca said.
“Owners need a clear expectation of estimated savings related to their upfront investment. We work to make the process easy for them and break down costs along with identifying the funding gap. For a lot of small multifamily owners … these owners don’t have a lot of cash flow to play around with. So if we aren’t bringing incentives, grant dollars, or some kind of financing as a resource it is hard to otherwise make that project work. The best scenario is that we can connect the owner to the problem and the financial tools that can help get to solutions,” Montesdeoca said.
Many energy efficiency incentives are geared toward single-family homes, but multi-family building owners and renters also struggle with high utility bills. Energy-efficient upgrades for multifamily units are essential in retaining affordable housing, according to Karen Lusson, staff attorney for the National Consumer Law Center, with offices in Boston and Washington D.C.
“The multifamily building market has always been a larger challenge. With the single family, it’s about reaching the homeowner and convincing the homeowner that this makes sense. Ideally, weatherization [and related] services should be provided at zero cost to the homeowner. In terms of the multifamily building owner, there can be variances in terms of the copays. There can be sliding scale copays for the building owner. But if we’re trying to increase the availability of affordable housing, we want to make sure those incentives are large enough, and those copays aren’t so big that they lose interest, or turn down these opportunities to invest in energy efficiency,” Lusson said.
Both ComEd and Ameren provide incentives for energy-efficient appliances for multifamily units as well as for single-family homes — working in Chicago and surrounding communities in collaboration with organizations like Elevate and MECRO.
Marcia Ellis is the owner of a six-unit property in Chicago’s New City community area located on the city’s Southwest Side. The legacy building, which was constructed in 1924, has been in the family since 1984. Ellis received a free energy assessment through Elevate, a loan through Community Investment Corporation and $44,697 in incentives from ComEd and Peoples Gas Energy Efficiency Programs to cover the cost of lighting retrofits, roof and pipe insulation, bathroom and kitchen aerators, LED lighting, a new high-efficiency boiler and other improvements. The return on investment? An estimated $2,380 in estimated annual savings, not to mention happy tenants.
MECRO worked with a senior in the community to improve the energy efficiency of her 100-year-old three-flat. Along with weatherstripping, insulation and replacement doors, the dwelling was fitted out with all-new appliances in each unit, according to Lewis.
“She gets three new air conditioners. … And she’s got a freezer in the basement that you could put a body in. It’s not energy efficient. She got a brand-new freezer. She got a stove and a refrigerator for three units, and a deep freezer. And she had her grandson’s college refrigerator. It’s not energy efficient. So, she got one of those. She got a new furnace and a new water heater. So, every appliance in her house is energy efficient.
“I visit her from time to time. You can tell the difference. You can literally tell the difference,” Lewis said.
And while making the conversion from gas or other carbon-based heating fuels to electric increases overall electric bills, making the switch can make up the difference by eliminating a gas bill altogether, according to Emma Baumgart, senior associate for communications at Elevate.
“With electrification [there] is the added benefit of having no gas bill. And especially in Chicago, People’s Gas has high fixed costs on your bill, where even if you’re not using any gas, you still are paying that monthly charge. And so that’s an added benefit of going fully electric. You still have fixed costs on your electric bill, but it’s just one instead of two. So obviously your electric bill goes up when you are converting to all electric, but by completely removing that fixed cost is another way that electrification can help with affordability,” Baumgart said.
For Lewis, a lifetime resident of Chicago’s Southeast Side, her work with MECRO in enabling residents to remain in their homes represents one way of investing in the well-being and stability of the community she calls home.
“Those things that impact the quality of life, impact how low-income housing exists in our community and how people are able to stay in their places and live comfortably,” Lewis said.
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