Advanced Energy Perspectives

In May 2023, Xcel Energy Colorado filed its inaugural Gas Infrastructure Plan (GIP). Not only was this a first for Colorado, but in a national regulatory landscape light on gas utility oversight, it was also among the first of its kind nationwide. With the gas industry facing unprecedented headwinds – and in light of changing policy, technology, and market conditions – states are looking for new tools to understand and evaluate gas infrastructure investments. Colorado is at the forefront of that change, with state, city, and county emissions reduction policies and programs layered on top of generous state and federal rebates and incentives for clean appliances. In addition, gas commodity and infrastructure costs are rising, and innovation and scale are happening in the cold-climate heating solutions marketplace. All of these beg the question: how do we align long-lived, ratepayer-funded utility infrastructure investments with these long-term trends while still providing for our energy needs in the near term?

Everyone deserves access to home heating that doesn’t burn a hole in their pockets. Yet, a recent study by Strategen conducted for Advanced Energy United sounds the alarm for Consumers Energy customers in Michigan. Monthly home heating bills, an already significant burden for many, are forecasted to rise — from an average of $75 in 2021 to between $114 and $131 in 2030.

According to local legend, in New York, it’s still illegal to put an ice cream cone in one’s back pocket while in public on Sundays. As the story goes, this law was enacted to prevent thieves from subtly luring a horse away from its rightful owner before the dawn of the motor vehicle. Though silly, this example is indicative of a larger trend: old laws from the 19th and 20th centuries often remain on the books because it’s more of a hassle to repeal them than to simply stop enforcing them. This can happen as social norms change, or as new technologies eclipse old ones.  

2023 was the year it became obvious – and undeniably so – that the status quo no longer serves us when it comes to heating our homes and businesses. Several trends have come into irreconcilable conflict. In particular, rising gas costs, vulnerabilities in the gas supply chain, and increasing gas infrastructure spending are juxtaposed against new, highly efficient electric appliance options, made ever more accessible by the 2022 federal Inflation Reduction Act as well as continued market growth and innovation. Consumer preferences continue to shift, and, for the second year in a row, electric-powered heat pump sales have surpassed those of gas furnaces.  

Since 2016, the United States has acknowledged every first Wednesday in October to celebrate one of the most essential players in combating climate change: energy efficiency. Bringing energy efficiency to the forefront of national observances spurs celebration of the benefits that come with it, such as lowering energy bills, reducing reliance on fossil fuels, and lowering greenhouse gas emissions. Pairing these benefits with improving grid resilience and reliability can create a healthier future for our communities and a true “powerhouse” climate solution.