Your Handbook on Building Electrification: Steps to a Cleaner, Cheaper Way to Heat our Homes

Building electrification (a.k.a. “building decarbonization” or “beneficial electrification”) means replacing natural gas with cleaner, more efficient and more affordable electric alternatives to heat our homes and cook our food. 

For the average consumer this ultimately means replacing your gas stove with an electric or induction model; buying an electric water heater; and switching out your gas furnace or boiler with a highly efficient electric heat pump. But let’s take it step by step. No doubt these are significant household changes that require thoughtful planning – electrification doesn’t happen overnight. The good news is there are a lot of excellent actions to take in the meantime. This handbook is designed to help you develop a step-by-step plan to fight climate change and lower your utility bills now, working up to the day when you’re ready to electrify.

Why electrify? 

As your gas-fired appliances near the end of their lives, electrification is a great opportunity to make deep cuts in your energy bills, protect your health and do your part to fight climate change. About 80 percent of Illinois homes now heat with natural gas, and we pay a steep price for that dependence.    

Natural gas is bad for our bottom lines. Unlike cleaner forms of energy, gas prices are more volatile than electricity, and the boom-bust cycle of this fossil fuel hits us with periodic price spikes and higher heating bills. Making matters worse, gas utilities in Illinois have launched aggressive capital programs, forcing their customers to pay billions of dollars to maintain aging pipes. “The bill gets bigger and bigger,” one gas customer wrote to CUB. “I can’t afford to pay at the rate they are raising it and can’t stay in my house with no heat…This is outrageous and unacceptable.”

Natural gas is bad for our health. Gas stoves could be exposing tens of millions of people  to pollution levels in their own homes that are so damaging they would break outdoor air quality standards, according to a review of studies by Physicians for Social Responsibility, the Rock Mountain Institute, Sierra Club and other groups. This indoor air pollution impacts generations: one study found that children in homes with gas cooking had a 42 percent increased risk of suffering asthma symptoms. 

Natural gas is bad for our planet. The United Nations’ Intergovernmental Panel on Climate Change has already declared that we have to act now to prevent the most catastrophic and expensive effects of climate change. It’s impossible to effectively fight climate change if most homes burn fossil fuels. 

The bottom line: The natural gas status quo is unsustainable. But every challenge poses an opportunity. With proper planning, fighting climate change and improving the air we breathe could help make deep cuts in our energy costs. 

In 2021, CUB’s research team released a study showing Chicago homeowners could enjoy lifetime savings of about $25,000 to $50,000 by switching their homes from gas to an efficient alternative that is gaining popularity for its cost-savings potential: electric heat pumps. 

Beyond making this change in your own home, eliminating natural gas across the state over the next few decades requires proper planning to make sure the transition doesn’t leave anyone with higher bills. Think of the most vulnerable energy customers–people with lower and fixed incomes who are already battered by high bills and don’t have the means to go all electric. This complexity, coupled with the urgency of climate change, is exactly why we need to begin planning now. 

These are big challenges, but we shouldn’t be paralyzed by them. We hope this handbook offers a clear, straightforward discussion about building electrification and concrete steps on how to cut costs and fight climate change. 

What are heat pumps?

A heat pump would be the most economical and environmentally friendly choice for switching your home from natural gas to electric heat. This section introduces you to these devices. 

How heat pumps work (Ground source vs Air source)

Heat pump systems are gaining popularity as a money-saving and environmentally friendly alternative to fossil fuel-based heating and cooling systems. But what are heat pumps and how do they operate? Are they a viable alternative to traditional heating and cooling? 

Fundamentally, heat pumps are a method for heating and cooling your home in a more energy-efficient, and environmentally friendly manner. Similar to a refrigerator, heat pumps use electricity to transfer heat from cool spaces to warm spaces, and vice versa. The devices are more economical than their traditional counterparts because they simply move heat, rather than produce their own warm air. Heat pump systems come in one of two principal types: air source and ground source.

Air source heat pumps

These devices transfer heat between the outside air and the inside of your home. Compared to traditional electric furnace or radiator heating, air pumps can reduce your costs by up to 50%, and many are capable of dehumidifying homes better than standard air conditioning systems. While traditional heat pumps use the ductwork already installed in many homes, mini-split heat pumps are capable of accomplishing the same goal in homes without ducts.

Geothermal (ground source)

These pumps can achieve even better efficiency by transferring heat between your home and the ground. Though more expensive than their air-source counterparts, geothermal pumps have very low maintenance costs since they take advantage of the relatively stable temperature of the ground. Geothermal pumps can reduce overall energy use by 30% to 60%.

Can heat pumps work in cold climates?

One of the most common misconceptions about heat pumps is the idea that they do not adequately work in cold-weather conditions, and therefore are not a viable option in regions like the Midwest. This is not true. 

Due to technology upgrades over the last decade, many leading models are now capable of operating at temperatures as cold as -10 degrees F.  For comparison, the average winter temperature in Chicago is about 26 degrees and in the Southern Illinois city of Carbondale it’s 33 degrees to 40 degrees. The development of variable speed inverter-driven compressors and other improvements make heat pumps capable of working almost anywhere–they have even passed field tests in northern Minnesota and the Arctic Circle. 

The benefits of using heat pumps

Heat pumps are an excellent way to heat and cool your home for a variety of reasons: comfort, savings, health and the environment.

Comfort

Due to drastically-improving updates in heat-pump technology, these systems are capable of working in even the most extreme temperature climates. For example, in Norway, which has an average winter temperature of about 20 degrees F, one in four people use heat pumps. And unlike a furnace or boiler, heat pumps also dehumidify and cool a home. In fact, an analysis by the Rocky Mountain Institute (RMI)  found that heat pumps kept Seattle homes comfortable and safe during a June 2021 heat wave that hit residents with temperatures up to 108 degrees F.  Because heat pumps constantly circulate air, they can keep your entire home at a comfortable temperature.

Economics

Energy efficiency–heat pumps are 50% to 60% more efficient compared to a traditional furnace or boiler–making the devices a wise choice for your bottom line. In a 2021 study, CUB found that heat pumps could provide a typical Chicago household a lifetime savings of anywhere from $24,716 to $47,104 depending upon the size and age of the home. “Cutting the pipe” and switching from gas to electric heat would pay for itself within three to eleven years, depending upon other energy improvements or upgrades in the home, according to CUB’s analysis.

Meanwhile, RMI found that all-electric homes with heat pumps are overall cheaper investments compared to households that rely upon a mix of electricity and natural gas for heating and cooling. Analyzing all-electric options in Minneapolis, which is even colder than Chicago, RMI found that all-electric households are cheaper to construct, and have consistently lower maintenance costs than those with gas furnaces and appliances. 

Health

In addition to a variety of economic benefits, heat pumps also are better for our health.   There is mounting evidence that cooking with gas produces unreasonably high levels of toxic particulate matter, nitrogen dioxide, carbon monoxide, and formaldehyde, all of which threaten our health. RMI found that burning a gas stove for one hour can produce nitrogen dioxide levels that exceed indoor guidelines as well as national standards for outdoor air quality.

Alarmingly, RMI linked the typical use of gas stoves to a 42% increase in rates of childhood asthma and a wide variety of additional health problems, including learning deficits, changed lung function and cardiovascular effects. All of this means that electrifying our homes with heat pumps can better protect the health of occupants, especially those most susceptible to pollution-related harm.

Environment

In addition to improving health outcomes and keeping you comfortable, electric heat pumps help individual homes fight climate change. Our climate challenges are big, and may seem overwhelming, but energy writer David Roberts says the current technology, including heat pumps, is already capable of switching to all-electric homes and taking the necessary step to cut our reliance on fossil fuels.

Elevate Energy, an Illinois nonprofit that promotes efficiency, and RMI identified heat pumps as an important part of Illinois’ statewide efficiency and carbon emission reduction goals. The historic Climate and Equitable Jobs Act (CEJA) sets a goal of Illinois reaching 100 percent clean energy by 2045, and electrifying homes plays a key role in achieving a cleaner and healthier energy future for all Illinois residents. 

Elevate and RMI showed that by electrifying 500,000 households (including the use of heat pumps), Illinois can avoid up to 28 million metric tons of carbon emissions by 2050.

Electrification: Getting started

  1. Complete your checklist of energy efficiency upgrades. Making your home as energy efficient as possible will maximize savings before you switch from natural gas. Plus, it’ll help when the time comes to purchase a heat pump: An energy efficient home may require a smaller, less expensive pump. (The formula that helps determine the appropriate size of a heat pump includes how much insulation your home has, for example.) See section X for a checklist. Also, visit CUB’s Clean Energy page,  CitizensUtilityBoard.org/clean-energy, for tips and programs to help make your home energy efficient.
  2. Manage your energy use. A key part to saving money while promoting a cleaner energy system is not just paying attention to how much energy you use, but also when you use it. Thanks to smart upgrades to the power grid, Illinoisans can now  access programs that save you money if you can put off the bulk of your electricity usage to times when electricity demand is lower. By reducing peak electricity demand, these “demand response” programs, including Hourly Pricing and Peak Time Savings, help make the grid cleaner and more reliable, and they help you save money. We recommend that all customers sign up for one or both of these programs.
  3. Use more renewable energy. The electricity flowing into our homes comes from a number of sources–from the cleanest (wind and solar) to the dirtiest (coal and natural gas)–at any given moment. Alternative electricity suppliers sell “renewable energy credits,” which allow you to support wind power being added somewhere to the grid. But often those plans are overpriced and support old, out-of-state renewable energy generation. However, thanks to strong Illinois policy developments, such as passage of the Future Energy Jobs Act and the Climate & Equitable Jobs Act, renewable energy has become much more accessible. For example, there are now strong incentives available to install panels on your property. If you can’t install panels–maybe you don’t have enough sun–then consider Illinois’ community solar program, which allows you to benefit from solar energy. Learn more at CUB’s Clean Energy page, at CitizensUtilityBoad.org. 

Energy efficiency checklist

The cheapest, cleanest kilowatt-hour (kWh) is the one you never use. The first step in electrification is making your home as efficient as possible. Start out with small actions and work up to major upgrades. 

  • Sign up for your utility’s Home Energy Assessment program (ComEd’s program, for example, installs LED bulbs, programmable thermostat, low-flow showerheads and faucet aerators and hot water pipe insulation.)
  • Switch out your most-used lights to LED bulbs. Thanks to strong energy efficiency law in Illinois, LEDs are offered with in-store discounts and many utility customers can get them for free through a home energy assessment. (Check with your utility.) 
  • Adjust your thermostat to your home’s optimal energy-saving temperature. In the winter, set it to 68 degrees when you’re home and awake. In the summer, set it to 78 degrees. When you’re asleep or away, bump it down or up, according to the season. According to the Department of Energy, setting your thermostat back 7 to 10 degrees from its normal setting for 8 hours a day can save you up to 10 percent a year on heating and cooling costs.
  • Clean/replace your furnace filters.
  • Phantom load is the energy burned on appliances that are plugged in but not in use. The U.S. The Department of Energy says 10 percent of your bill can be chalked up to devices not in use, such as a cellphone charger plugged into the wall but not charging a phone; a coffee pot that’s not brewing but has indicator lights still burning. Regularly turn off and unplug appliances not in use, and use a power strip for your entertainment center and/or computer system.
  • Wash your clothes in cold water. Cut down on dryer use by using a clothesline or drying rack. (If you use the dryer, make sure to clean the lint trap between loads.)
  • Insulate your hot water pipes and hot water heater, and put the heater on the warm setting (120 degrees).
  • Seal leaks by adding caulk around windows and weatherstripping around door frames. And seal the ductwork throughout your house.
  • Buy a programmable or smart thermostat—making sure to get a model that can be compatible with a heat pump if you want to electrify. Also, see if your utility offers a rebate. Such thermostats can save you 10 percent on your energy bills.
  • Check your wall and attic insulation. The U.S. Department of Energy warns that you could suffer significant heat loss through your home’s attic if the insulation levels are less than the recommended minimum. If the insulation is even with or below the attic floor joists, it’s time to add more.
  • Get a home energy audit. A first step is to see if your utility offers a free “home energy assessment.” That’s different from a full-blown audit, but still valuable. Usually this free service involves a trained technician making energy efficiency improvements–installing LED light bulbs, a low-flow shower head, even a programmable thermostat. Home energy audits, on the other hand, are much more comprehensive—and they’re not free. Still, such a service can be a worthwhile investment, because it pinpoints what parts of your home’s heating and cooling system and building structure are inefficient. They also enable the auditor to determine what upgrades to your home will help you save the most energy and have the fastest payback period. You can find good auditors through the internet–and through the recommendations of like-minded friends.
  • Visit your utility’s websites and check out what incentives or rebates are available for appliances, home improvements and other purchases. Purchasing a new, Energy Star-approved appliance is a big decision, but you should see substantial savings on your bill. If you have older appliances, such as your refrigerator, dishwasher, and clothes dryer, they likely take a big bite out of your energy budget.

Visit CUB’s Clean Energy page, at CitizensUtilityBoard.org, for more information.

Heat pump shopping tips

If you’re ready to shop for a heat pump, this section offers some guidance to make the purchase that’s best for your home.

Selecting a type

  • Air-source
    • Pros: The most popular and affordable option.
    • Cons: You may need an additional heat source if temperatures in your area regularly drop below 10 to 25 degrees Fahrenheit, depending on the unit specifications.
  • Split-Ductless
    • Pros: Require minimal construction and a great option for single-room additions or homes without ductwork.
    • Cons: Oversized or incorrectly located air handlers can cause short cycling, which wastes energy and poorly maintains temperature and/or humidity control.
  • Geothermal
    • Pros: Long lasting, requiring little maintenance, and effective in extreme climates.
    • Cons: Most expensive option and not practical for small lots, certain subsoils or landscaping conditions.

Pay attention to the details

  • Base your heat pump size on a recommendation from a heating and cooling professional.
    • If your heat pump is the wrong size, it won’t heat or cool effectively and will increase your energy bills.
    • A heating and cooling professional should use an Air Conditioning Contractors of America Manual J calculation to determine the right size, which considers your home’s foundation, wall thicknesses, insulation values, windows and air filtration.
    • Proper installation by a professional will help reduce problems and increase savings.
  • Research special features that may be important to your needs.
    • Compatibility with a smart or programmable thermostat to adjust the temperature automatically as needed.
    • Variable speed fans keep the air moving at a comfortable velocity, minimizing cool drafts and maximizing savings. (You can keep this on the “auto” setting.)
    • Zone control systems, often found in larger homes, use automatic dampers to allow the heat pump to keep different rooms at different temperatures.
  • Look for the Energy Star label for a heat pump you’re considering, and read the energy efficiency rating.
    • Cooling efficiency is measured by SEER (Seasonal Energy Efficiency Ratio).
    • Heating efficiency is measured by HSPF (Heating Seasonal Performance Factor).
    • You should consider buying a heat pump that is at least 15 SEER and 8.5 HSPF. The most-efficient heat pumps are 18 to 27.5 SEER and 8.5 to 12.5 HSPF.

Heat pump maintenance tips

Once you install a heat pump, your work isn’t finished. Maintain the unit for best efficiency and cost savings.

  • Perform minor maintenance at home.
    • Clean the supply and return registers in your home, and straighten their fins if bent. Power down the fan to clean as needed.
    • Clean and change filters following the manufacturer’s recommendation.
    • Clean outdoor coils occasionally and remove vegetation or clutter from around the outdoor unit.
  • Properly insulate and weatherproof your home for efficiency.
    • Insulate walls, crawlspaces and attics to retain heating and cooling.
    • Properly seal your ductwork in crawl spaces and attics.
    • Check your ducts for air leaks and patch with duct mastic.
  • Have a professional technician service your heat pump at least once a year.
    • Check for problems with low airflow, leaky ducts, or incorrect refrigerant charge.
    • Refrigeration systems should be leak-checked at installation and during each service call, especially for split-system heat pumps, which are charged in the field.

Policy recommendations: How do we assure a fair, equitable transition?

Building electrification is gaining traction across the country as an effective tool to reduce greenhouse gas emissions and improve indoor air quality. The Climate and Equitable Jobs Act (CEJA) establishes a path for Illinois to achieve a 100% carbon-free power sector by 2045. As the state incorporates more renewables to meet this goal, building electrification becomes a way to utilize those renewable resources connected to the electric grid.

Since natural gas is currently Illinois’ primary heating fuel, heat pump technology plays a critical role in building electrification. In fact, RMI found that 10 states account for nearly 60 percent of greenhouse gas emissions from buildings–and  Illinois ranks third for total annual natural gas delivery in buildings, indicating that there is a lot of work to be done. With the expansion of heat pump technology and building electrification, certain considerations need to be at the forefront in order to protect customers and allow for an equitable transition.

Prioritize emissions reductions rather than further gas investments. New spending should support carbon-free alternatives to gas such as weatherization and electric heat pumps. Any further spending on gas should focus on safety and leak-reduction needs rather than replacing or building out more gas infrastructure. Prioritizing clean energy investments instead of increased spending on gas infrastructure can help protect utility ratepayers from bearing the cost of infrastructure that is incompatible with climate change goals.

Stop constructing new gas-fueled homes and buildings. Research from RMI found that constructing new, all-electric homes in four U.S. cities, including Chicago, had lower costs than homes connected to gas. Constructing new all-electric homes avoids the cost of gas mains, services, and meters that are ultimately foisted on consumers. All-electric new construction buildings present an efficient step to ensure that we are not investing more money into gas infrastructure.

Advocate for municipalities to adopt stronger building efficiency standards. The Climate & Equitable Jobs Act (CEJA) calls for the development of a “stretch energy code,” which will allow for individual municipalities to require a higher level of energy efficiency in buildings than the standard energy code. Although this process is currently underway, advocating for more stringent efficiency codes can help to ensure that new residential buildings are more efficient and electric. 

Plan for a cost-efficient transition for gas-fueled buildings. Electrification is not something that will happen overnight, but requires thoughtful planning to hold down costs for consumers. Rather than replacing all your gas-fueled appliances immediately, replace a gas appliance at the end of its life. For example, installing a heat pump is cheaper than having to replace both an old furnace and central air conditioner at the same time. Additionally, in a retrofit scenario like this, the homeowner’s costs over the lifetime of the appliance are reduced. 

Protect the most vulnerable customers in this transition. As more people “cut the pipe” and disconnect from their gas completely, energy policy must protect the rights and the well-being of the remaining gas utility customers who don’t yet have the means to transition to cleaner, more affordable heating options. Typically the costs to operate and maintain the gas system is split among customers via the charges on their gas bills. As electrification gains more popularity, these gas costs will be spread over fewer customers, forcing the most vulnerable consumers–low to moderate income households who can’t afford to electrify–to pay higher gas bills. Gas customers who face a financial barrier to electrification will need assistance in order to shield them from the rising cost of gas. Equity concerns must be at the forefront of policies to ensure that no one gets left behind in this clean energy future. 

Energy policy must prioritize equity. Beyond reducing carbon emissions, building electrification provides benefits to underserved communities such as improved air quality, reduced energy burden, improving comfort at home and providing living-wage jobs. Given that electrification involves major home investments and upfront costs, it’s challenging to ensure the transition is done equitably, so  low- to moderate-income households have access to its benefits.  

The Climate & Equitable Jobs Act (CEJA) allows utilities to include building electrification measures in their energy efficiency programs. This means that Illinois’ electric utilities may start to offer and promote electrification programs, provided that they reduce the total energy consumption at the premises and provide bill savings. Under CEJA,  25% of energy savings claimed by electric investor-owned utilities must come from lower-income customers. Policies that prioritize underserved communities are vital to equitably pursue electrification. 

Community engagement is a must to do electrification right. Community engagement–neighborhood events and other outreach strategies in partnership with communities–helps to educate consumers about building electrification, and it educates advocates and policymakers on the barriers preventing people  from electrifying their homes. Engagement can identify a lower income community’s needs and priorities, and thus strengthen the design and delivery of programs that strive to aid in the electrification in neighborhoods that need it the most.

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