Report: Rapid Transition to Electric Heat Pumps in Oregon will Lower Household Energy Bills, Cut Climate Pollution

Salem, Ore. — A rapid transition to highly efficient electric heat pumps for heating and cooling in Oregon homes and buildings would lower household energy bills, generate $1.1 billion in system-wide savings by 2050, and dramatically reduce climate pollution — all without major grid impacts according to a report released today by Synapse Energy Economics. The findings, which come on the eve of the one year anniversary of the deadly Pacific Northwest heat dome, suggest that heat pumps could play a key role in adding cooling to Oregon homes without overloading the electricity grid.

"Roughly 4 in 10 Oregon homes do not have cooling, and we saw during the heat dome last year just how dangerous this gap in climate resilience can be – especially for low-income households and communities of color. The findings from the report suggest that heat pumps can play an essential role in adding lifesaving cooling to millions of Oregon homes while supporting a reliable electricity grid, lowering winter heating bills, and cutting the fossil fuel pollution that is fueling the climate crisis," said Joel Iboa, Founding Executive Director at Oregon Just Transition Alliance (OJTA).

The report modeled the economic, climate, and grid impacts of two ambitious target dates for achieving 100% zero-emission appliance sales in Oregon: 2025 and 2030. The report finds that a 2025 implementation date would cut climate pollution from residential homes 56 percent by 2035 compared to 1990s levels and just shy of 100 percent by 2050. A 2030 implementation date would cut climate pollution 47% by 2035, while achieving similar 2050 reductions. These reductions in climate pollution come from the transition away from gas heating appliances – which are a major source of carbon emissions and air pollutants.

"Buildings are one of Oregon’s fastest growing sources of climate emissions. Repowering our buildings to run on clean, high-efficiency, and affordable electric appliances is a key solution for avoiding the worst impacts of climate change, while uplifting resilience in the face of climate-fueled heat waves. Rogue Climate’s Energize programs have already led to the installation of over 250 reduced-price heat and cooling pumps to low-income and rural households in Southern Oregon and the South Coast. The findings from this report make it more clear than ever that we should be investing in technology that truly brings benefits to communities that need it the most," said Alessandra de la Torre, Rogue Climate’s Advocacy and Programs Director.

Despite the rapid pace of the transition from polluting gas to electric appliances modeled in the analysis, the report found that total electricity demand from homes and buildings would increase just 13 percent by 2050 compared to 2019 under both scenarios. This manageable increase in electricity consumption is driven by a reduction of inefficient electric resistance heaters in coming years, which put major strain on Oregon’s electricity grid, in favor of highly-efficient electric heat pumps, which can reduce electricity consumption for heating by 50 percent. Electric heat pumps provide cooling that is up to 330 percent more efficient than window AC units.

"Our study is one of the first to model what a rapid transition to electric heating heat pumps in Oregon could mean for the state’s electricity grid. We show that rapid adoption of these high-efficiency systems reduces winter peak demand from Oregon homes, and that overall peaks grow slowly, around half a percent per year, which is consistent with past and projected growth rates for annual total electricity loads," said Kenji Takahashi, the lead author of the report and senior associate with Synapse.

The report modeled the impact on energy bills from the transition to highly-efficient electric heat pumps in two Oregon cities; Portland and Bend. In Portland, the report found that households that electrify will save $161 annually on energy bills compared to homes that burn gas, and in Bend, the report projected $192 in annual savings.

Under a 2030 implementation date for a zero-emissions sales standard for appliances, the report projects that electrification begins reducing total system costs beginning in 2030, and achieves annual cost savings of roughly $280 million by 2050. Total system-wide savings for the scenario are expected to reach $1.1 billion through 2050. Under a 2025 implementation date, the report projects that building electrification begins to save system costs from 2023, and cost savings reach $290 million in the year 2050.

"We know that the transition away from fossil fuel appliances for heating has to happen to avoid the most catastrophic consequences of climate change – but even if you look at this issue from purely from an economic perspective, transitioning our homes off of polluting fuels like methane gas is still the right decision for Oregonians," said Dylan Plummer, senior campaign representative for the Sierra Club.

The findings come as the city of Eugene forges ahead with development of Oregon’s first local policy to phase out gas in new construction — a move cities across the state are widely expected to replicate — and as Oregon leaders grapple with how to regulate gas utilities and meet state decarbonization goals. In the 2022 session, the Oregon legislature formed the Resilient Efficient Buildings (REBuilding) Task Force to provide policy recommendations to decarbonize the state's building sector.

Simultaneously, the Oregon Public Utility Commission is now accepting feedback on its "Natural Gas Fact-finding" ("Future of Gas") proceeding which is looking at the use of gas in the state in response to Governor Kate Brown’s Executive Order 20-04 directing state agencies to reduce climate emissions.