Report: Clean, Cost-Effective Heating Technologies Critical to Meeting California’s Climate Goals

High-Efficiency Heat Pumps Can Also Help Make Housing More Affordable

SAN FRANCISCO – Californians can save as much as $1,500 in installation costs, plus hundreds of dollars on their utility bills, by switching to clean space- and water-heating technologies now but super-high-efficiency electric heat pumps must become mainstream over the next 12 years to meet the state’s clean energy goals, according to a report published today.

The analysis by Synapse Energy Economics shows that if one-third of California’s buildings converted to space and water heating technology primarily powered by renewably generated electricity by 2030, heating emissions would fall by 7 million metric tons annually – equivalent to avoiding the annual emissions from 1.5 million cars or the pollution from nearly four 500-megawatt gas power plants running around the clock.

The report, “Decarbonization of Heating Energy Use in California Buildings: Technology, Markets, Impacts, and Policy Solutions, was commissioned by the Natural Resources Defense Council (NRDC). It is the first in-depth analysis of the economics and grid impacts of reducing the emissions from burning fuel onsite for heating interior spaces and providing hot water for showers and other uses in California.

“Roughly 90 percent of California’s furnaces and hot water heaters are fueled by gas or propane,” noted NRDC building decarbonization senior scientist Pierre Delforge. “Given that buildings account for one-fourth of California’s greenhouse gas emissions, and most of that comes from energy used for space and water heating, it’s critical that we increase our use of cost-effective, clean alternative technologies available today, like heat pumps.

“In light of the recent dire warnings from the Intergovernmental Panel on Climate Change, we need to move quickly to avoid climate chaos. Here’s a place where California can once again show the world what can be done to further decarbonize our society.”

Heat pumps, which move heat rather than burning fuel to create it, include equipment for space heating (which are already broadly adopted in commercial buildings), water heaters, and clothes dryers.

Because they are so much more efficient than gas-powered heating equipment, heat pumps save significant amounts of energy and emissions. They also can cost up to $1,500 less to install in homes. The economics of heat pumps for individual customers is a more complex question and varies widely depending on the building, occupants’ usage, their utility rates, and whether the structure has solar panels, the report said. Greater savings – which also can make housing more affordable -- are achieved when pairing electrification with some energy efficiency upgrades, time-varying electric rate designs, and by using solar panels to supply the larger electric load.

“The technology is available to cost-effectively and dramatically reduce emissions from California buildings,” says Dr. Asa Hopkins, the Synapse report lead author. “The state’s challenge will be to rapidly grow the markets for heat pumps for water and space heat in order to have a material impact on emissions by 2030.”

Other technologies like solar thermal, which uses the sun to heat water, and induction stoves also can reduce dependence on fossil fuels and help meet California’s new goal to become carbon-neutral by 2045, which will require a shift to clean electric heat, according to the report.

The report highlights four policy areas for the California state government, local jurisdictions, and utilities to jumpstart the market for cleaner heating technologies and help make it accessible and affordable to all Californians:

  • Raise awareness and educate: Consumers, policymakers, product distributors, and building contractors need to be familiar with the availability, benefits, and how to install clean electric heating.
  • Set targets and develop plans: The clean heating market needs certainty and stable investment to expand. Two recently passed California laws are an important first step. But more is needed, particularly to help owners of existing buildings switch to clean heating.
  • Remove regulatory and market barriers: Incentives for distributors and retailers, along with financing and utility rate designs for electric heating, are among the ways the state can address cost and product availability hurdles.
  • Transform the market: Revising building codes to encourage clean heating technologies in new buildings, investing in further research, and encouraging concurrent energy efficiency upgrades can lend additional support to clean heat technologies.

The full report can be found here:

Delforge’s blog on the report is here.


The Natural Resources Defense Council (NRDC) is an international nonprofit environmental organization with more than 3 million members and online activists. Since 1970, our lawyers, scientists, and other environmental specialists have worked to protect the world's natural resources, public health, and the environment. NRDC has offices in New York City, Washington, D.C., Los Angeles, San Francisco, Chicago, Bozeman, MT, and Beijing. Visit us at and follow us on Twitter @NRDC. 



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