The Ad Hoc Gist: Winter’s Electric Future
Welcome back! In this quarter’s Gist, we focus on the spike in home heating costs this winter, and how the so-called “Build Back Better” bill moving through Congress could accelerate the electrification of winter.
In AHG news, we’re hiring for a VP of Utilities and Energy (ping me if interested). We’ve also added new Ad Hoc’ers Annie Gilleo, Principal and Kate Scott, Associate/Extern, and new senior advisors Steve Malnight, Will Craven, and Olya Anguelov.
Have feedback on the Gist or an idea for our next one? Drop me a line at email@example.com.
In the new year we’ll move to a monthly edition of the Gist. So stay tuned.
December 8, 2021
Build Back Better and the Politics of Rising Home Heating Costs
This winter, rising home heating costs are an acute pain point:
- 50-80% of U.S. residential fuel consumption occurs in winter.
- Natural gas, which heats nearly half of U.S. homes, nearly doubled in price this year and is now merely up by half.
- Households in the Northeast and Upper Midwest that use propane for heat could spend upwards of 94 percent more on their energy bills than they did a year ago.
The federal cavalry is too late to help this winter, but if Congress can pass Build Back Better before the holidays, they’ll provide a new year’s gift to Americans who are suffering through the worst heating bills in a decade. We need to end this volatility once and for all -- and with it, a heap of carbon emissions. Gone, the fossil furnace in the basement. In its place, geothermal and air source heat pumps, plus other products that can lower home heating costs for millions of households.
Build Back Better (the House passed version) is powerful:
- Households would get 30% off a new geothermal heat pump, and 30% off a home battery. They could get up to another $14,000 in rebates to electrify home heating by installing an all-electric air-source or geothermal heat pump.
- Coupled with 30% off home solar and a new $1200 incentive for energy efficiency, we’re talking about a major potential shift in home climatenomics.
The impact in leading states will be super-sized, while laggards miss out:
States that already have ambitious electrification goals and incentives will win big, like New York, Massachusetts, and Maine. States like Colorado, Illinois, and Minnesota, which passed new legislation this year to incentivize fuel switching, will follow fast. Then there will be states that still need to be pried open, like Michigan and Pennsylvania, where fuel switching incentives are forbidden. C’mon guys!
A pack of startups are ready to pounce:
- Dandelion makes it explicit: “Upgrade to geothermal and never buy heating oil, propane, or natural gas again.”
- Sealed is marketing energy efficiency as an aspirational quality-of-life tune-up.
- BlocPower is installing heat pumps and efficiency in low and middle income buildings.
- Stash and Stow are rolling combined battery/heat pump products out of the lab.
- Gradient’s sleek window modules provide heating & AC via heat pumps and next-gen refrigerants.
- Radiator Labs has a hybrid electrification approach for buildings that will be the hardest to fully electrify.
In summary, we’re about to do some serious judo on the way millions of households stay warm. None of this will happen overnight. We’re not going to mothball billions of dollars in existing gas infrastructure tomorrow. We’ll also need companies to balance escalating winter peak demand so we don’t repeat a Texas-like debacle. But the electric winter is coming; our climate demands it.
The Ancient Romans also tackled home heating innovation: the remains of a “hypocaust” HVAC system near Limassol, Cyprus. (Photo: Encyclopædia Britannica)
News from Our Network
From our clients:
NBC News featured Aeroseal helping owners of a 1927 home save money in time for winter.
AiDash announced $27 million in Series B funding by G2VP for its satellite-based vegetation management platform for utilities.
BlocPower announced a partnership with Ithaca, New York, pop. 30,000, to electrify ALL of the city’s buildings.
Pano AI gets kudos from Aspen fire authorities on NBC News Denver, and T&D World reports on their pilot with PG&E and Portland General Electric.
Octopus Energy raised an astounding $600 million from Al Gore’s Generation Fund to bring its customer-centric software to US utilities and build a more efficient heat pump.
Axios featured ev.energy’s efforts to turn EVs into virtual power plants, saving both drivers and utilities money and carbon.
Charm CEO Peter Reinhardt and Stripe Head of Climate Nan Ransohoff were interviewed (in front of a flock of sheep) by CNBC at COP26 on the importance of carbon removal.
David Roberts calls out Singularity’s work in his piece on the big new thing in meeting 24/7 carbon-free energy targets.
Friends & Colleagues:
Ran Nussbacher, founder of DC-area eatery Shouk (pro tip: try the mushroom shawarma) takes a jab at Elon Musk while extolling the virtue of a plant-based food on CBS Sunday Morning.
After a year traveling the world, Josh Green took his EV asset finance company Inspiration out of stealth mode and raised $200 million.
Meghan Nutting, EVP at Sunnova, was honored by Energy Secretary Jennifer Granholm for her clean energy impact; we’re a long way from grad school, friend.
Gregg Dixon and his relentless squad of demand response gurus at Voltus are going public via a $1.3 billion SPAC.
Alexandria, VA, my hometown, ranked 3 on CNBC’s top 10 list for cities that have converted the most office space post-pandemic into housing (955 units!).
Reasons for Hope, Reasons for Despair
Hope.... Democracy needs a local news revival so I’m pleased to see Axios Local expanding to 25 cities. Let’s get off of social media and back to news about our communities.
Despair… The fact that Belarus’ Alexander Lukashenko can threaten to cut off natural gas to western Europe is another reason we need to get off this stuff forever.