ENERGY BRIEFING: Groups Push Home Appliance Transition Rebates

A new report recommends the government create a system of consumer rebates worth an estimated $265 billion over the next decade to help American households transition to electric appliances, Kellie Lunney reports.

Decarbonization goals mean robust investments in electrification across the U.S. economy, including in people’s homes. That starts with more energy-efficient heaters, stovetops, and breaker boxes, according to the analysis from the Center for American Progress and Rewiring America, a nonprofit advocating for the electrification of the economy.

But the groups don’t want that transition to be cost-prohibitive for families. The plan calls for an average incentive of $4,000 to participating households and an average rebate of $6,200 to participating low-to-moderate income households to incentivize the replacement of fossil fuel-powered appliances.

“We don’t need to invent new technology, and we aren’t asking people to sacrifice,” said Ari Matusiak, CEO of Rewiring America and co-founder of Purpose Venture Group, in a recent interview. Traditional appliances last between 10 and 20 years before they need to be replaced, which is why it’s important to introduce a rebate and consumer education program now for electric alternatives before missing that window of opportunity, he said.

The shift to electric appliances—the kind that are ubiquitous in households—has several benefits, proponents say, from reducing pollution inside homes to reducing utility bills to creating jobs. And those jobs can’t be automated or offshored, Matusiak said. “The person who installs your water heater is going to be relatively nearby.”

The rebates would help cover upfront equipment and installation costs. The proposed numbers are “designed to capture the kind of market dynamic we see,” said Matusiak. “As the market scales, the rebate levels would come down over time.”

Every zip code in America has homes that need these items, Matusiak said, arguing for the proposal’s bipartisan appeal. “Why wouldn’t this be bipartisan? You are creating jobs and helping constituents save money on their bills.”

Last week, Sen. Martin Heinrich (D-N.M.) introduced the Electrifying America’s Future Resolution (fact sheet) which aims to electrify residential and commercial construction, transportation, and industrial sectors to reduce energy bills, improve air quality, and create jobs. The resolution is a blueprint to inform the infrastructure package in Congress, he said

Happening on the Hill

Biden Meeting with GOP’s Capito Yields No Deal: President Joe Biden met yesterday with the Senate’s main Republican negotiator on infrastructure, and although the talks didn’t yield a breakthrough for a bipartisan compromise, they agreed to speak again tomorrow. The Oval Office session between the president and Sen. Shelley Moore Capito (R-W.Va.), which the White House called “a constructive and frank conversation,” lasted more than an hour. Read more from Erik Wasson.

Bipartisan Senators Push for PILT Program: Sens. Michael Bennet (D-Colo.) and Mike Crapo (R-Idaho) led more than 30 lawmakers in a letter to Senate appropriations leaders calling for the full funding of the Payments in Lieu of Taxes (PILT) program for fiscal year 2022. The program pays counties with non-taxable federal land to offset lost property taxes. The lawmakers also called for long-term solutions to the funding, which must be annually renewed by Congress. Read the letter here.

Dingell Plans Bill as Restaurants, Stores Ban ‘Forever Chemicals’: Fast-food restaurants and grocery store chains are joining a growing number of states in pushing “forever chemicals” out of food packaging, despite a federal thumbs-up that allows PFAS to touch what people eat. McDonald’s, Wendy’s, and Whole Foods Market, are among at least 15 companies that have announced policies in recent years to phase PFAS out of packaging they use or sell. Rep. Debbie Dingell (D-Mich.) also plans to reintroduce legislation requiring the FDA to ban any use of PFAS in food packaging. Read more from Pat Rizzuto.

Energy & Natural Resources

Electricity Payouts on Biggest Grid Fall 64%: Power-plant owners serving the biggest U.S. grid will be paid 64% less next year for being on standby to keep the lights on from New Jersey to Illinois. Suppliers to PJM Interconnection’s grid, which serves more than 65 million people, will get $50 a megawatt-day to provide capacity for the the year starting June 2022, according to the results of an auction released yesterday. That’s down sharply from $140 in the previous auction, held in 2018. Analysts had expected the price would fall to about $85. “Renewables, nuclear and new natural gas generators saw the greatest increases in cleared capacity, while coal units saw the largest decrease,” PJM said in a statement. Read more from Will Wade and Mark Chediak.

Gates-Backed TerraPower Plans New Reactor: TerraPower, an advanced nuclear technology company founded by billionaire Bill Gates, is planning to build a new demonstration reactor as part of a wave of smaller designs that could help propel the sector forward as it struggles to compete with cheaper forms of power. The company plans on constructing at a shuttered coal power plant in Wyoming and is evaluating several potential sites with PacifiCorp.’s Rocky Mountain Power unit, according to an emailed statement yesterday. A selection is expected to be made by the end of the year. Read more from Will Wade and Ari Natter.

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Environment & Chemicals

California Officials Urge EPA to Restore Auto Emissions Waiver: Top California officials urged the Biden administration to swiftly restore the state’s power to mandate emission-free vehicles and enforce stringent limits on greenhouse gases from vehicle tailpipes. “California’s greenhouse gas and zero-emissions vehicle standards are not only legal, but essential for California and other states to meet our climate goals and protect the health of our residents,” Attorney General Rob Bonta said at an EPA hearing, Jennifer A. Dlouhy reports. The EPA is considering reversing a Trump-era decision to revoke a waiver allowing California to enforce its pollution standards, which are adhered to by 13 states representing more than a third of the U.S. automobile market.

Connecticut Climate Case Punted to State Court: A federal judge tossed another climate liability case back to state court less than two weeks after the case was argued in district court last month. Judge Janet C. Hall of the U.S. District Court for the District of Connecticut ordered that Connecticut’s climate fraud case be pushed back to the state court where it was filed, since Exxon Mobil couldn’t prove that the claims are preempted by federal law.

The case is akin to a thicket of other climate liability lawsuits brought by states, cities, and counties looking to hold energy companies liable for deceiving the public about fossil fuel contributions to global warming. In every case, oil and gas companies have argued that the complaints use state laws to try and affect climate change policy best left to other branches of government. Read more from Jennifer Hijazi.

Washington State Water Quality Lawsuit Advances: The Environmental Protection Agency’s refusal to determine whether Washington state needs updated water quality standards is subject to judicial review and an environmental group’s lawsuit may proceed, a federal court in the state ruled. A refusal to engage in agency rulemaking under the Clean Water Act “still enables a court to judge whether the refusal is grounded in statute,” according to the U.S. District Court for the Western District of Washington. This involves “legal as opposed to factual analysis,” the court said Tuesday, citing precedent. It also presents a case where the affected party has a right to “question the agency through a petition, unlike in an enforcement action,” according to the ruling. Read more from Maya Earls.

Florida Law Funds Phosphate Plant Closure: Florida will spend as much as $100 million to close a former phosphate plant near Tampa Bay, under a state budget signed yesterday by Gov. Ron DeSantis (R), Jennifer Kay reports. A breach in the 480-million-gallon reservoir at the Piney Point site in April threatened to trigger a catastrophic flood, prompting state lawmakers to allocate some of the federal funds padding Florida’s $100 billion budget toward its cleanup and closure.

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With assistance from Jennifer Kay

To contact the reporters on this story: Kellie Lunney in Washington at klunney@bloombergindustry.com; Zachary Sherwood in Washington at zsherwood@bgov.com

To contact the editors responsible for this story: Giuseppe Macri at gmacri@bgov.com; Michaela Ross at mross@bgov.com

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