Regulatory Support: How Government can Support Net-Zero Goals
The following is the fifth part of an eight-part series to dive deeper into the eight key takeaways from the Net-Zero Emissions Opportunities for Gas Utilities report. If you are interested in the full report, you can learn more at https://www.aga.org/netzero.
In February 2022, the American Gas Association (AGA) released a bold vision for the future that details how America’s natural gas, natural gas utilities and delivery infrastructure are essential to meeting our nation’s greenhouse gas emissions reduction goals. Building on the industry’s ambitious Climate Change Position Statement from January 2020, Net-Zero Emissions Opportunities for Gas Utilities presents a national-level approach that leverages the unique advantages of gas technologies and distribution infrastructure.
Several modeled pathways are analyzed to underscore the range of scenarios and technology opportunities available as the nation, regions, states and communities develop and implement emissions reduction plans. The study details eight key findings including:
Smart policies and regulations will be essential for natural gas utilities to achieve net-zero emissions
As we look to reaching a cleaner energy future and net-zero emissions targets, a broad mix of regulatory and policy drivers will be needed to initiate, sustain, and support achieving those goals.
New policies and regulations could help to define and structure requirements and incentives for emissions reduction targets. The success of any emissions reduction plan will depend highly upon the structure and support of public policy at every level, and federal, state or local policies should be designed to consider and leverage our nation’s extensive natural gas infrastructure and efficient end-use applications in meeting greenhouse gas emissions targets.
Natural gas utilities invest $4.3 million per day in energy efficiency programs to help customers make their homes more efficient, including steps like installing tighter-fitting windows and doors, upgrading insulation and purchasing increasingly more efficient natural gas appliances. Greater energy efficiency means that customers can do more with less energy, driving down greenhouse gas emissions. Expanding regulatory support for energy efficiency initiatives is one way that local, state, and federal governments can ensure natural gas utilities and customers are prioritizing lowering their carbon footprint on the path to net-zero greenhouse gas emissions.
Natural gas utilities deliver energy to customers and communities efficiently and affordably. And as they work to provide choices and reliable energy to customers, many companies are advancing innovative technologies in their systems, including renewable natural gas and hydrogen. Regulations that would allow for voluntary opt-in to programs that would make use of these technologies would be a way to further reduce emissions and provide agency to customers wanting to leverage their utility for a lower carbon footprint.
Hybrid gas-electric heating systems are another area where regulatory support can play a significant role. Hybrid systems can provide space heating using an electric air-sourcing pump paired with a natural gas furnace and utilize integrated controls that optimize the energy consumption, emissions and the cost of the system throughout the year. Hybrid heating can also help provide many of the decarbonization benefits of all-electric heat pumps while offering additional flexibility and resiliency on days with low renewable generation by switching to gas heating to reduce cold weather electric peaks. This way gas and electric utilities can work collaboratively to maintain heat reliability for customers and maintain affordable energy bills during cold periods.
To enable this best-of-both-worlds approach, a new and more flexible regulatory paradigm will be required. Leveraging residential direct gas use and electricity together in decarbonization plans would help alleviate certain challenges associated with an electrification-only approach, including the logistical and cost barriers that retrofitting existing buildings and systems bring to the table, not to mention grid constraints.
Gas utilities and the gas infrastructure have unique benefits they can offer in America’s efforts to decarbonize our energy mix and meet emissions reduction goals. Regulators have a responsibility to ensure customers have safe and reliable energy, thus they can help states, cities, and utilities meet emissions goals faster while providing higher reliability and lowering costs to customers with proper regulatory support.