The California Roadmap to a Carbon Free Future for the Built Environment

By Steven Guttmann and Ted Tiffany

Steven Guttmann, PE, BCxP, is a LEED Fellow.

Ted Tiffany is LEED AP BD+C certified.

May 8, 2019 | Governance, Resources | 0 comments

Participants of COP21 (Paris, 2015) agreed that limiting the average global temperature rise to 1.5 degrees Celsius was an absolute imperative, and that this goal would require that human-produced emissions peak in 2020 and get to zero (yes, ZERO!) by 2050. California set the decarbonization train in motion in 2006 with passage of the California Global Warming Solutions Act (California Assembly Bill 32). While much progress has been made, many recognize that the pace of change must accelerate if the worst effects of carbon in the atmosphere are to be avoided (see Figure 2).

 

Figure 1- Relative Cost Effectiveness of GHG Reduction Strategies
Source: California Energy Commission

 

 

In March of 2018, a small group of California building industry professionals met to organize an Affiliate Event to the Global Climate Action Summit. Frankly, the word “decarbonization” was new to most of them. The Summit took place in San Francisco in September, 2018. A year and a Summit later, the concept of decarbonization has become mainstream in the building industry in California. The Building Decarbonization Coalition (BDC) was born out of pre-Summit efforts to accelerate the implementation and achievement of AB32 and COP21 goals, and to respond to the demand for policy, technology, and expertise to be well-aligned in support of these goals.

Figure 2 – California’s GHG Reduction Targets
Source: BDC Roadmap

The BDC consists of a diverse assembly of energy providers, public interest advocates, manufacturers, contractors, workers, builders, local governments, real estate interests and investors spanning California’s building community. In February 2019, the Coalition released “A Roadmap to Decarbonize California Buildings”.

The Roadmap promotes the following principles to guide California in achieving its goals:

  • EQUITABLE AND AFFORDABLE: Deliver building decarbonization equitably and affordably to all communities to prevent disproportionately burdening customers least likely to be able to overcome the awareness and capital costs barriers.
  • ALIGNED: All stakeholder (customer, contractor, utility, agency, manufacturer) value propositions for building decarbonization must be recognized and aligned to achieve the speed and scale of transition California needs.
  • GRID FRIENDLY: Ensure building decarbonization solutions serve as a benefit to the grid, especially the need to reliably integrate renewable energy into California’s power supply at least cost.

Recommendations from the Roadmap include:

  • California should adopt a Zero Emission Building Code for the residential sector by 2025, and commercial sector by 2028.
  • California should build the market share for underlying technologies to hit the following targets:
    • Increase the share of high efficiency heat pumps for space heating from five percent (5%) of sales in 2018 to fifty percent (50%) in 2025 and one hundred percent (100%) in 2030.
    • Increase the share of high efficiency heat pumps for domestic water heating from one percent of sales in 2018 to fifty percent in 2025 and one hundred percent in 2030.

The Roadmap is a recognition that the primary strategies employed to date in California – improvements in energy efficiency and an increase in renewable energy production – have been effective at stemming the growth of GHG emissions in the State, even as the population and GDP grew from 2006 to 2016, but are not adequate to achieve California’s emissions targets by 2030 or 2050 (see Figure 3). The focus must be expanded to include building electrification and grid harmonization.

 

Figure 3 – California GHG Emissions Reductions versus Population Growth, Energy Use, and GDP
Sources: Energy Information Administration, California Department of Finance, California Air Resources Board, and Statista

 

Building Electrification

We are on the path to obtain all of California’s electricity from carbon-free resources by 2045. This transition makes it possible for the built environment to achieve carbon neutrality by converting systems that are currently powered by fossil fuels to already available technologies powered by electricity.

Decarbonizing other fuel sources is much more complicated and costly. There is a concerted effort to replace natural gas with renewable biogas and captured methane from landfills, wastewater treatment facilities, and dairies, but these sources cannot fully serve our current and future needs. As a result, we must pursue all-electric buildings to achieve meaningful decarbonization of the built environment.

A range of barriers can prevent this vision from being achieved, and the Roadmap advances a theory of change to overcome them, including setting ambitious targets, policy alignment, coordinated marketing, retail price reductions, upstream incentives to manufacturers and builders, clear market signals to suppliers, financing solutions (especially for underserved communities), and coalition building. The Roadmap outlines specific goals and identifies specific actions to overcome each of the main barriers to building decarbonization (see Figure 4). The Roadmap’s initiatives will increase demand for electric-powered technologies for building services, will ensure that customers and builders receive value from pursuing these options, ensure that supply chains are able to meet rising demand, and that public policies (Codes, utility rate structures, etc.) are aligned with these results.

 

Figure 4 – Key Initiatives from the BDC Roadmap
Source: BDC Roadmap

 

Grid Harmonization

A growing percentage of energy distributed on the grid in California is being supplied by renewable energy generation (mostly solar and wind). Meanwhile, our base load generation systems (primarily nuclear and natural gas plants) must stay in operation since they cannot easily, or cost effectively, be turned on and off in response to short term fluctuations in demand and solar production. The need to have energy production available to respond to short term energy demand results in the need to either curtail solar resources during the daytime or sell excess solar to other Western states at a loss (yes, we are essentially paying others to take our excess solar energy).

 

Figure 5 – The “Duck” Curve. Source: California Independent System Operator (CAISO).

 

This operational limitation of our energy generation resources has resulted in a generation profile known as the “duck curve.” In the belly of the duck (the middle of the day), solar production is driving down the use of convention power generation facilities. Ironically, in the short term, increasing electricity usage during the middle of the day through building electrification, as well as creating building systems that are responsive to grid capacity, are essential components of a strategy to facilitate our reliance on a grid supplied by a growing percentage of renewable energy.

In order for buildings to make the desired contribution to the State’s decarbonization goals (until such time that we can rely on 100% carbon-free grid power), electricity generation systems, building systems, and the grid that connects them have to be responsive to a new model of energy resource management. All-electric buildings will accomplish this through demand-responsive building controls and energy storage systems (grid and building scale) that are conscious of the carbon-signature of the power supplied by the grid (see Figure 6).

 

Figure 6. Carbon intensity on the grid in California. The emissions intensity of electricity varies by season and time of day. This figure shows the relative emissions intensity of electricity consumption compared to natural gas use. For Building Decarbonization to fully realize its potential as a reducer of emissions, measures need to use electricity when the emission intensity of the energy is low (green) instead of when it is high (red).

 

To this end, another key initiative is underway: the GridOptimal Initiative. The New Buildings Institute (NBI) is working with utilities, national labs, and engineers to help develop tools for designers to create buildings that are responsive to grid carbon signatures.

When a building is designed or retrofitted with demand responsive controls, on-site solar electricity production, battery storage and/or thermal storage, these technologies can be deployed to mitigate carbon emissions from the grid in real time. A building can be programmed to reduce grid stress that causes fossil-fuel fired plants to increase generation capacity; for example, LED lights can be slightly dimmed in times of grid stress with little impact to building function. Pre-cooling homes in the middle of the day when solar is available and allowing temperatures to rise slowly through the evening demand peak can also reduce HVAC power usage with simple control strategies. Thermal energy storage in commercial buildings can accomplish the same result.

Also, a building can be programmed to react to excess solar on the grid, and be a resource for storing renewable energy.  Buildings with on-site PV coupled with battery storage can prioritize storage or on-site deployable loads (such as electric vehicle charging stations or domestic hot water production) to absorb energy before exporting it onto the grid.

For this to become cost effective and affordable, utility rate structures must be aligned to the carbon content of the electricity delivered, so that cost optimization and carbon reduction are synchronized. Currently, rate structures throughout the country are designed for demand management, and commodity costs aren’t aligned with carbon content.

Decommissioning the Natural Gas Supply System

As if there aren’t enough barriers to building electrification, there is a new consideration that is getting attention: decommissioning of the natural gas system. Reducing gas use in buildings could lead to a reduction in the gas customer base and a diminished need for the state’s gas infrastructure. With increased building electrification, legacy gas investments may no longer be recoverable from utility  customers through rates, potentially causing substantial investment value to be “stranded.” If not addressed proactively, “stranded” gas assets can complicate the effort to transition the state away from excessive reliance on gas and its incompatibility with California climate goals.

The Environmental Defense Fund (EDF) tackled this issue head on in their recent report “Managing the Transition: Proactive Solutions for Stranded Gas Asset Risk in California”. The EDF report lays out the state of the existing infrastructure, strategic targeting of electrification, development of pathways for early asset retirement, and alternative uses of the existing assets. The EDF report doesn’t come close to “solving” the challenge; the report’s stated goal is to “play a convening role” to start the discussion of decommissioning the natural gas system.

Conclusions

Fires, floods, and failing infrastructure is causing California to feel the urgency of addressing climate change, and the push for solutions is on a fast pace. Building electrification is gaining popularity for one simple reason: we know how to make “clean” electricity.

The next few decades of work are going to require these initiatives to be funded, implemented, and will require successfully balancing the interests of all stakeholders – public and private. It’s an enormous effort, but there are signs that the Building Decarbonization Coalition’s approach of engagement coupled with research, policy development, and consumer inspiration, is already moving the state towards fast, fair action to accelerate the development of zero-emission homes and buildings that will help California cut one of its largest sources of climate pollution, while creating safe, healthy and affordable communities. Hopefully, California can provide an international template for future action at a global scale, because California alone cannot mitigate the effects of global greenhouse gas emissions.

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