By Chris Herb
President and CEO
Connecticut Energy Marketers Association
Connecticut regulators have a way of not learning from past mistakes. For us, the new Comprehensive Energy Strategy (CES) 2022 is déjà vu all over again.
In 2012, the Department of Environmental Protection (called DEP then) unveiled the initial draft of its plan to convert 280,000 homes in Connecticut from home heating oil, and propane to natural gas at the ratepayers’ expense; meaning ratepayers would be on the hook for building natural gas pipelines and not the natural gas utilities.
We fought the plan for many reasons:
- It was unfair to ratepayers and would lead to increased bills.
- No environmental studies were commissioned.
- The state government should not be picking winners and losers in the energy market.
- Our industry had a more environmental friendly fuel.
It turns out, we were right. It took ten years, but we finally got our moment to say, “we told you so.”
This year, the state pulled the plug on its failed attempt to convert Connecticut homeowners to natural gas but only after a huge cost to ratepayers and the environment.
Natural gas turned out not to be the “cleaner and cheaper” solution as promised. In fact, Dr. Cary Lynch, Climate and Energy Policy Manager and The Nature Conservancy, compelled state regulators in her testimony to end the natural gas expansion program calling it “expensive, unfair to ratepayers and inconsistent with the state’s Greenhouse Gas Emission Reductions Goals.” She also testified that the northeast region’s reliance on natural gas for energy generation and heating was a significant factor in high electric rates. (Public Utilities Regulatory Authority/ PURA docket, page 10)
As we already mentioned, the plan also dramatically increased costs for natural gas customers, something we also said would happen ten years ago. In that same PURA report, data showed that from 2014 to 2021, the average cost for new service DOUBLED for Connecticut Natural Gas (CNG) and Southern Connecticut Gas (SCG) customers and TRIPLED for Yankee Gas. (See November 3, 2021 Decision in Docket No. 21-03-01)
On top of that, the goal to convert 280,000 homes to natural gas failed to meet its goal and came in only at 32%. That’s a HUGE price increase for ratepayers for such a LOW performance.
Yet, despite this epic failure, the state is once again looking to change the way we heat our homes, heat our businesses and this time, how we drive to work, school, church and the grocery store.
This time around, The Department of Energy and Environmental Protection (now called DEEP) pretty much wants to electrify everything in its new Comprehensive Energy Strategy plan released this year. CES-2022 calls on converting homes, apartment buildings, and businesses from natural gas, oil heat, and propane to electricity, after spending the last ten years trying to convince people to convert to natural gas. If this blows your mind, it should.
What does electrify everything mean? DEEP state wants your furnace to be electric, your water heater to be electric, and your car to be electric too. There are so many issues tied to this idea that we literally could write a book but for the sake of this article, we will boil it down for you.
Electric heat is expensive and not reliable
To retrofit your home with a heat pump, it would cost about $20,000 to $40,000 and they become very inefficient in cold weather. Even with this new electric heating, your energy costs would only increase more. We all know what our utility bills are like during the summer months, and with electric heat pumps, you should expect to pay more in the winter as well.
So, if you already have a perfectly functioning oil heat, propane, or natural gas heating system, why would you spend 20 thousand to 40 thousand dollars to switch to electricity? This is an expensive switch over and there is really no return on investment.
Decarbonizing the economy is something you will hear a lot about during the next year or so while DEEP pushes its new CES-2022 plan to electrify the heating and transportation sectors. By definition, decarbonization is the process of reducing and removing carbon dioxide output from a country’s economy.
However, electricity is not a net-zero carbon emission’s fuel that DEEP would like us to believe.
At any given day this past winter the fuels that were used to generate electricity in the region as reported by the ISO-New England showed natural gas over 60 percent of the power grid, oil more than 20%, and even coal was being used. And on May 24, 2022, we were using 62% of natural gas to generate electricity.
DEEP wants everyone to close their eyes and believe that the grid is zero emissions and 100% wind and solar and hydro-generated electricity—when the truth is that we are not even close to that. So, hooking up more homes, businesses and cars to electricity will only increase the use of more natural gas, impacting the environment and your bottom line again.
A fragile electricity grid
Blackouts and brownouts are a real threat to Connecticut and the region!
“We do not have a robust energy supply chain,” Gordon van Welie, president and chief executive officer of ISO-New England, told members of the legislature’s Energy and Technology Committee during an informational hearing this past legislative session on why New England’s electric grid is facing the possibility of planned blackouts during extended periods of extremely cold weather. “We’re running way too close to the edge,” he said.
In December, van Welie first warned of the “heightened risk” to the region’s grid if there is a prolonged cold snap combined with a shortage of natural as for power plants that could prompt the need for rolling blackouts throughout New England.
In response to these warnings, Eversource and United Illuminating took unprecedented steps this past winter to prepare local officials and customers about the potential for power outages.
Since we do not have our electricity house in order considering our current demand for power is prompting warnings of potential blackouts, how can DEEP contemplate increasing demand by virtually electrifying the entire economy?
Our solution — bioheat fuel
With 56% of single-family homes in Connecticut using liquid fuel to keep warm (U.S Census), our industry is uniquely positioned to transition from traditional heating oil to Bioheat® fuel and propane to renewable propane. Bioheat® fuel is a blend of ultra low sulfur heating oil and renewable biodiesel that is derived from waste products like used cooking oil and grown products like soy beans. More than 500,000 homes in our state need little or no modification to their heating equipment to start using a fuel that is cleaner and has the ability to displace fossil fuel today.
Using liquid renewable fuels like biodiesel does not require homeowners to have to spend money to replace their oil heat equipment with other technologies, and it does not require the cost of upgrading electric service to accommodate heating equipment that solely relies on electricity to produce heat. Biodiesel does deliver a number of benefits to the environment and the electric ratepayer of our state by forgoing the need for massive investments in new electric generation and upgrading its distribution.
We believe that Bioheat ® fuel is a big part of the solution to lowering carbon emissions without breaking the bank of homeowners forced to switch to electric heat that comes with a big price tag of new equipment and energy bills.
We look forward to helping DEEP meet its goals of lower emissions for the well being of our customers and ask regulators to not to repeat painful past mistakes seen with the failed the natural gas expansion plan, which only led to more carbon emissions and higher energy bills.