The Role of Gas Efficiency in the Time of Electrification

Energy efficiency programs need to prioritize: Improving the efficiency of building “envelopes;” addressing the pressing needs of under-resourced (low-income) communities and communities of color; and eliminating incentives for building new homes that use gas.

Credit: iStock/taniche

Transitioning most of our energy uses to clean electricity in an equitable manner is necessary to meet our 2050 climate goals. But what is the role of gas energy efficiency programs as we move to electrify America’s buildings? The short answer is there are still plenty of economic, climate, and energy benefits to pursue as long as utilities and their regulators adhere to a few simple guidelines: Prioritize improving the efficiency of building “envelopes,” addressing the pressing needs of under-resourced (low-income) communities and communities of color; and eliminating incentives for building new homes that use gas. 


For years, energy efficiency has been one of the energy sector’s silver bullets. Investing in efficiency improvements has held America’s energy use constant over the last 15 years despite a 33 percent increase in GDP, saved households an average of $500 each year on utility bills, and created 2.4 million U.S. jobs. As we reduce the use of fossil fuels directly in our homes and buildings by installing appliances that can run on 100 percent clean electricity, efficiency will still be an important tool for avoiding unnecessary electric system costs in the future.

Efficiency’s Role in Equitable Building Electrification

To stabilize our climate and successfully transition to a thriving clean energy economy, we need to eliminate virtually all greenhouse gas (GHG) emissions from the buildings where we live and work. This likely means replacing nearly every fossil fuel-burning appliance with one that can run on electricity generated from clean sources such as wind and power. Given the magnitude of this challenge, we must ensure that none of our energy investments are at cross-purposes to this goal. For efficiency funding that is not tied to a specific fuel—programs that don’t care whether a home uses gas or electricity—this means focusing on and fully funding the transition to efficient, all-electric technologies that are key to meeting our climate goals. It also means prioritizing the smooth, equitable transition of under-resourced and Black, Indigenous, People of Color (BIPOC) communities that have disproportionately higher energy burdens off of the fossil fuel system.

As more people transition to all-electric buildings, the costs of maintaining the gas system will rise for those still dependent on it. If we do not prioritize the people who are least able to afford new all-electric equipment in this transition, we risk leaving them holding the bag on a system with a decreasing customer base and increasing costs.  

Focus on Building Efficiency for Long-Term Success

Gas efficiency programs are funded by gas utility customers. They commonly offer rebates for new efficient gas appliances and fund weatherization and other building efficiency upgrades. A recent American Council for an Energy Efficient Economy (ACEEE) report, makes several helpful recommendations for improving the efficacy and cost-benefit of those programs. In particular, we agree that “going forward, building shell improvements in existing buildings will be particularly important to reduce costs and emissions,” and that increased partnerships and cost-sharing between gas and electric utilities is necessary to fully realize the benefits of this type of investment.

However, the report does not suggest how to balance the short-term benefits of some efficient gas appliances with the reality that those appliances will operate—and produced GHG emissions—for 10 to 20 years.

One way to strike this balance is to focus gas programs on improving the efficiency of the buildings, rather than on the appliances within them. That includes insulating buildings, reducing air infiltrations, improving ventilation, and upgrading windows. Envelope efficiency helps homes and businesses stay warmer in the winter, cooler in the summer, and improve indoor air quality while reducing energy costs, regardless of the type of energy. Envelope upgrades improve the quality of life of residents, especially those living in housing that is in disrepair due to historic underinvestment, and make it easier and cheaper to switch those buildings and residents to 100 percent clean electricity when the time is right.

Because continuing to install long-lived gas appliances is incompatible with meeting our climate and equity goals, gas efficiency funds should no longer go toward any fossil gas equipment unless there is a clear social, health, or equity concern or crisis that cannot be effectively addressed with efficient all-electric solutions. All-electric equipment should be the preferred solution and all available efforts (including envelope efficiency) should be leveraged to make those clean electric options work for residents.

How to Avoid Locking People into a Polluting Gas System

Gas efficiency programs, like all clean energy initiatives, should prioritize the BIPOC and low-income communities that have historically been underserved. With regards to appliance rebates, this means first and foremost doing everything possible to help these residents move off the fossil gas system while saving money. However, in some cases, largely depending on local weather and electricity costs, providing immediate relief from disproportionate energy burdens and unhealthy living conditions may involve installing new, highly efficient gas appliances. The decision to install gas or electric appliances should be weighed carefully and be based on the following three key factors:

  • The short-term cost to residents of electrifying home energy uses in areas with high utility rates.   
  • A full accounting of the long-term costs of maintaining a safe and reliable gas delivery system.
  • The risk that a new gas appliance will lead to higher energy costs in the future for the customer receiving that appliance.  

Continuing to install gas equipment at the same time we’re working to reduce our dependence on all fossil fuels risks leaving the most vulnerable customers to pay the rising costs of an underutilized gas system. To prevent this, California consumer advocates recently asked regulators to investigate when efficiency programs reserved for low-income customers should sunset their gas appliance incentives in favor of clean electric options. We should be asking these questions about every energy efficiency program in every state and ensuring that BIPOC leaders are helping set and adopt the solutions for their own communities.

Building Clean from the Start Is More Important Every Day

Finally, we should not be investing any more of our energy efficiency funds on helping new buildings pipe for and install gas appliances. Most of the buildings that will house us in 2050 have already been built—which is why how we operate and upgrade those buildings today is so important to securing a stable climate future. But we will continue to build new homes and offices in the meantime, and it is vital that those buildings do not continue to further our dependence on polluting fossil fuels.

Building efficient, healthy, all-electric buildings will mean lower energy costs from the start. This will be particularly important for affordable housing for under-resourced households as it ensures their energy costs are minimized from the get-go and that they are insulated from having to finance the rising costs of the gas system as electrification of existing buildings takes hold.

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