Tiny Laboratories of (Energy) Democracy — Episode 171 of Local Energy Rules

Jesse Gray:

Our focus has been on expanding, stepping back from what some people would call solutionism where you’re only allowing one solution and allowing any kind of solution since we don’t know what will work best in what situation. So we’d like to see the gas company be able to help also, I don’t wanna give them a new monopoly.

John Farrell:

Brookline, Massachusetts was the first city outside of California and the first city with a cold winter to take action against expansion of the natural gas network by banning new buildings from connecting to it. But the local effort for more self-determination in the community’s energy and climate future are not limited to one particular action. In November, 2022, I was joined by Jesse Gray, chair of the Brookline Zero Emission Advisory Board, and David Mendels. Together they are co-founders of Zero Carbon Massachusetts and the force behind the new municipal climate empowerment program embodied in a series of six proposals to give Massachusetts cities and towns more power over their energy future. I’m John Farrell, director of the Energy Democracy Initiative at the Institute for Local Self-Reliance and this is Local Energy Rules, a biweekly podcast sharing powerful stories about local renewable energy. David and Jesse, welcome to Local Energy Rules.

Jesse Gray:

Thank you.

Pleasure to be with you.

John Farrell:

Yeah, it’s so great to have you. And as I was thinking about setting up this time for us to talk, I had been noodling for the past year some of our previous conversations about this idea of cities banning new hookups to the gas network, kind of as a crucial turning point in getting us to moving from continue to expand the fossil fuel network to contracting it and as a way that cities can have leverage in this shift toward cleaner energy for buildings as well as the progress that we’ve been making on cleaner energy for electricity generation through rooftop and community solar and things like that. And then across my Twitter feed, maybe a couple weeks ago comes this municipal climate empowerment plan from the Zero Carbon Massachusetts Twitter account. And I’m thinking, oh, I really need to follow up with them, not just on how this concept around gas hookups was going, but clearly they’ve been thinking much more comprehensively about what cities can do.

So why don’t we start with though, what had gotten me interested in the first place was Brookline, Massachusetts was one of the first places outside of California that talked about stopping new connections to the gas network, the natural gas network. The idea being that if we are going to get buildings to switch off of gas, we need to stop connecting them in the first place. And you can fill in some more if there’s, in terms of that rationale, but talk me through a little bit more what’s the rationale for this kind of policy? Why try it at the local level and how is it going? Has it been expanding beyond Brookline? Are there other policies that have been following in?

Jesse Gray:

Yeah, we’re in the business of electrifying everything because that is really the only way to get our emissions down to the levels that we need to get our emissions down to. And there’s a lot of denial about this. A lot of people don’t understand this yet. A lot of people are still focused on using less plastic, recycling plastic bottles as a form of climate action. And we have that here in the schools in Brookline. A lot of the school clubs are still focused on that type of activity. But the most impactful thing that we can do to reduce our emissions is to electrify everything and continue greening the grid, which is a success story already and will continue to be a success story. So that’s the overall emissions reduction strategy. And obviously not everyone is on board with that. And in particular the gas companies are not on board.

So we have an entrenched interest and they are coming up with all kinds of wild and crazy ideas that they claim will solve the problem. Things like renewable gas, which can’t be produced in enough quantity to solve the problem. Hydrogen, which is incredibly inefficient and would require all new piping anyway. So one of the experiences of being a climate activist is that you realize there’s no adults in the room, that no one’s got this under control. The problem is not being solved fast enough, government is failing and has been for decades. So it’s the question of what can we do? How do we solve this problem? How do we get ourselves into political gear? And we settled on municipalities as they are now being referred to by many as the tiny laboratories of democracy. And they’re also where the rubber meets the road. And although we need to electrify every single building, the heat, the hot water, the dryer, the cooking, and that’s gonna be a lot of work, the easy part is just not installing brand new fossil fuel infrastructure during major construction.

And Berkeley, California led the way in 2019 with the first gas ban in the country. And actually even before it was passed, we were following it and we decided that it was at this beautiful Venn diagram intersection of practical, politically possible and impactful on emissions. All three are important criteria and so we decided to introduce that in Brookline, Massachusetts where we have much more will to take action than the larger commonwealth of Massachusetts has. Where you have the utility lobbying the legislature, the fossil fuel industry, lobbying the legislature, which in turn the commonwealth has much more motivation than the federal government. So in adopting this policy and pushing for it, we were really undertaking our first attempt at aligning authority with will. So cities have the will to act, what they often lack is the authority. That’s why municipalization is such an important topic and so pleased that you’re promoting that.

So our overall political strategy is to align the will of municipalities with the authority to take meaningful climate action. And a gas ban turned out to be a great example of that because we did not have the authority to do it. We asserted the authority to do it. We were rejected by the attorney General and then we went to legislature and asked for permission to do it. And within one legislative cycle at which the beginning, it seemed like an impossibility. By the end the legislature passed a pilot program that led to the creation of this program where 10 municipalities in Massachusetts will be able to ban gas in major construction. And the way that we did that is we first passed it in Brookline and we passed it nearly unanimously. And then because of that, now it’s up to 13 other communities including Boston, our very large neighbor.

We only have about 60,000 people in Brookline. So we’re relatively small. And so we were thrilled that these other municipalities stepped in and followed our lead. We were the first outside California to do this, the first in the cold weather climate and the first to include renovations. And we were followed by New York City, Washington, DC and others. So the strategy actually worked by pushing from the local level. It was easier for the commonwealth to give us permission to do it locally than it was for them to ban gas throughout the whole state, which they’re still a long ways from doing, I think of it as Massachusetts is like the parent who tells the child that you’re not allowed to clean your room. Because this is a problem we need to solve. And rather than requiring all the kids in the house to clean their room, it’s easier for the parent to say, okay, we will allow you to clean your room if you wish. And that’s the situation we have here with the gas bans in Massachusetts. There’s 351 municipalities in Massachusetts, only 10 so far will be allowed to ban <laugh> fossil fuel infrastructure in major construction. But we’re beginning to gain some momentum and by continuing to have municipalities passed these so-called home rule petitions, which are formal requests for this authority, we’re building further momentum.

John Farrell:

I just have to ask you cuz one thing I think is interesting that I’ve heard in Minnesota, and I know this is true in other places, is that we are starting to have some very robust conversations about the future of the natural gas system. And one of the things that we’ve learned is that to use your metaphor of the parents and the children and cleaning the room is that right now the parents are actually paying the children to mess their room because we subsidize in many places extensions of the gas network to new construction. So those home buyers who are getting a new house are actually getting a subsidy to have a gas line extended to their home. Is that true in Massachusetts? Are you finding that’s true in other places and is that something that you’ve also had to deal with

Jesse Gray:

In various forms, it is true. And so one, one of the recent examples here is that the town of Wellesley, Massachusetts, and this was written up in the globe actually, they were building a fossil fuel free net zero school and another municipal building and they were all kind of set to go when the gas company, I think it was National Grid in their case, offered them a 1.5 million incentive to install a gas connection at the high school. So that was offered through what’s called mass save, which is a rate payer funded efficiency fund. So you do actually have rate payers through programs like Mass Save, subsidizing the installation of new fossil fuel infrastructure.

David Mendels:

Yeah, I’ll just add that it’s the fundamental structure of a gas monopoly that they’re only allowed to install gas and they’re required to offer it to anybody who requests it. And if you’re only allowed to install gas, you’re just gonna keep pushing for that and pushing for that. So we’ll get to this, but when we think about the municipal climate empowerment plan, one of the pieces of that is enabling the gas utility to do something other than install gas to help us electrify so that we’re not forced to be antagonists right now. Even if there were lots and lots of people of good will at our gas utilities, they literally are not allowed to do anything. But so guess

John Farrell:

I am definitely gonna wanna talk to you more about this because I think it is one of the most interesting and challenging problems that we’ve set for ourselves is the way that we have parceled out management of the energy system by technology rather than by the actual end use. But before we get into that too far, let’s go ahead and pivot. And I would love to hear about the municipal climate empowerment plan that I first came across on social media. I assume that it has a lot to do with this discussion of home rule and giving cities more authority to do things. David, why don’t you get us started. Tell me about what’s in this plan and what are the different components that you’re talking about?

David Mendels = David

I can set it up. First of all, we started by focusing on new buildings because that’s an easier problem because as Jesse points out, not installing stuff is easier than retrofitting stuff that’s already installed. So we started there and it’s great and we’re gonna make a lot of progress, but it’s a very small percentage of the building stock in our town and in Massachusetts is new construction. And in order to actually address the problems of decarbonizing buildings, we have to address the existing building stock we have to address retrofits and retrofits are expensive and they’re complicated as architects like to point out every building is different. It’s an obvious statement, but it really makes this a complicated and expensive problem. And whether or not you have docks installed, whether or not your home is well insulated, there’s all kinds of variables that can make the costs extremely variable.

And we have state level subsidies for heat pump installation. We now have the Inflation reduction Act, federal subsidies for things like heat pump installation, but it’s not sufficient to cover the incredible cost and complexity of doing retrofits, which is tough. And especially in Massachusetts, we have a lot of old homes. And so a lot of work needs to get done beyond just buying a heat pump. A key insight here is we’re not just gonna be able to ban stuff. There’s a lot of work that needs to get done, a lot of education that needs to get done, a lot of contractor education that needs to get done and we’re, we’re gonna need to be able to invest in programs in incentives in a wide range of things. In order to start building the state of Massachusetts set a goal in 2020 of decarbonizing a million homes by 2030.

And I believe the number is they did 500 in 2021. So we’re nowhere close and even in Brookline. And we’re a very progressive town that’s has a lot of climate will as Jesse puts it. But we’re doing a few handfuls a year. And so we gotta go from a few handfuls to a few dozen to a few hundred to a thousand a year by the 2030s and that’s gonna require investment. And so that’s really what led us to the municipal climate empowerment plan. One is where are we gonna get this investment from? What is the pool of money that we can get to to start building these programs, creating the incentives and moving down that learning curve from a handful of homes to thousands of homes. And then secondly, where are we gonna get the authority and the right to do this from the state? And that led to a series of foreign articles, a home rule petitions, again following a similar pattern that we used with the gas ban of let’s pass this in Brookline, let’s build allies across the state in a wide range of municipalities and towns. Let’s go to the state legislature and get this then on a statewide basis, maybe starting as a pilot but hopefully statewide. And then the details of that, I’m gonna pass to Jesse to walk through like what, what actually is the municipal climate empowerment plan?

Jesse Gray:

Yeah, the plan has kind of two components. So the first is a mechanism to administer programs and on that particular side we we’re establishing what will be called an emissions reduction fund and a mechanism for spending that money where the zero admissions advisory board, which is a five person board of people who focus a lot of time on the technical aspects of electrification, that board would make recommendations to our legislative body in Brookline, which is town meeting on how to spend money from that fund. And the idea is that that fund would enable us to administer programs to solve some of what I think of as the rate limiting steps of electrification. So there’s a lot of money that’s being left on the table, especially now after the IRA was passed, after new climate legislation and new mass save incentives in Massachusetts, a lot of money’s being left on the table because fundamentally the IRA doesn’t do a whole lot on its own.

Jesse Gray:

It provides a lot of money for other entities to do a lot on their own. So if they don’t act, then nothing will happen. So the rate limiting steps of retrofit electrification include that property owners don’t know what to do, they don’t even know that this should be a priority. They don’t know that when an appliance dies they need to replace it with an electric replacement, not another gas appliance for example. And even if they understand that they don’t know how to do it, they don’t know how to think about home electrification, you need to think of the whole home. You need to plan for a car charger, an electric induction stove, an electric electric dryer, electric heat pumps. And by the time you do all that, you probably need a panel upgrade or some other types of hacks, which can save a lot of money on the distribution side by the way.

Jesse Gray:

So for example, these devices that will only charge your car when your dryer’s not running, that is a several hundred dollars device that can save tens of thousands or hundreds of thousands of dollars of utility distribution upgrades that get charged to rate payers. So property owner education is one of the needs that we would need programs to address that contractor. Education’s a big one. And when I went to a contractor and asked to get a heat pump for my home, I was told that they don’t work in the winter. And when I pushed back on that, I was told that they’re too hard to repair in the winter. And when I said, what? What do you mean they’re too hard for repair? Well they’re out in the snow. And I said, so it’s cold for the person repairing the heat pump out in the snow. And then the contractor said, well, it’s high voltage, it’s very dangerous. And I said, so you don’t turn off the circuit breaker before working on a on an appliance <laugh>. But these are the conversations people are having and a lot of homeowners are understandably quite willing to defer to the information that they hear from contractors about about what’s not feasible. So we need contractor education.

John Farrell:

I’m so glad you brought this up cuz there’s so many anecdotes out there. I have my furnace serviced regularly because it’s 25 years old and I’m wanting to make the replacement at the right time and whatever. And every time someone comes out to service it, they’re like, oh my god, I love your furnace. Like the contractors just love it because it’s not complicated, right? They’re like, it’s simple, it’s mechanical, there’s like hardly any electronics. And that’s what they really like and it’s super problematic because they’re not even interested in, like I’ve also asked contractors about heat pumps and the stories that they provide are universally bad. Like they had one bad experience at one install and now they’re just like, Nope, I just wanna give you a furnace. I wanna give you something that works.

Jesse Gray:

Right, exactly. So, so that’s the problem of contractor education and you have it not just on the HVAC side where it is pretty awful. I mean I think most of the time the advice that property owners get is wrong. I would say when it comes to heat pumps more than half the time it’s wrong, maybe even 80% or 90% of the time. But even on the electrical side is a problem because electricians are just used to working in a certain way. And if you call an electrician and say, I need a car charger, they will say, okay, what model do you have? And you can say, I’m getting a juice box or whatever. And then they look at the specs for that and then they do their standard load calculation and then they tell you, well, you’re gonna need a new panel and a new service upgrade to your building.

Jesse Gray:

But what they don’t offer is the fact, and they, a lot of them don’t even know that there are devices that can completely obviate the need for those kinds of upgrades without any downside really for the property owner. Nobody needs to charge their car while their dryer’s running and there’s no reason you can’t pass electrical inspection with these types of systems. But electricians don’t tell people that because that’s not the type of problem solving they’re used to engaging in. They’re used to taking a very specific request and then getting to the solution. The final, so we have property owner education, we have contractor education. The final piece is that we’re gonna need program management because the set of incentives that are available to people and the set of financing options for retrofit electrification are so complex to navigate. And the management challenge of finding the contractors and overseeing the work is such a big challenge that there’s quite a bit of project management that’s needed to hold people’s hands, hold the hands of property owners through this process.

Jesse Gray:

And by the way, a lot of us in our group of climate activists and climate strategists have electrified our own homes already. So we’ve experienced this first hand and including I electrified mine, I have a hundred year old house and I retrofitted it to be geothermal heating and cooling by drilling 2 525 foot vertical wells in my tiny front yard. The truck literally had to sit over three people’s properties in order to drill the well. Cause that’s how small my front yard is. So anyway, those are the three main areas that we need programs in. And in order to have those programs to address those rate limiting steps of electrification, why instead of doing a hundred thousand buildings a year in Massachusetts, we’re doing 500 buildings a year. And then the question is, how do you fund that? Where does the money come from? And right now the only mechanism that we have is to have a town wide vote for a property tax increase.

Jesse Gray:

And that’s really all that we have available to us in Brookline. And in all likelihood I think we will actually be doing that. We were very interested to see what happened recently in Ann Arbor, Michigan where they passed a millage that will bring in about 6.8 million a year for uh, climate action. And so we could do something similar to that, but we were thinking about what is the smartest and fairest most equitable way to do this, who should pay? And it seems to us that the people who can most afford to bear the burden of this transition that we all need to make, the people who frankly are responsible for the most carbon pollution people of means should be paying for this transition because a crisis is a terrible thing to waste and we ought to make our society more fair through the actions that we have to take to solve this problem.

Jesse Gray:

So for that reason, we have in our slate of six articles, we focused on progressive taxation and carbon taxes. So we’ve focused on a series of essentially carbon taxes with income or related types of exemptions so that people who are struggling financially in Brookline are not gonna be set back or asked to pay for something that they can’t afford. So that’s what I would say the overview is to just run quickly through what the programs are. They’re not all funding mechanisms to fund the programs. I was mentioning earlier the first one, it’s called Article 21, it is a financing program. We have a program of septic betterments in Massachusetts where you can get a low interest loan from a locality in order to finance a septic upgrade. So we have in Article 21 electrification betterments. So we’re asking for the authority from the state to do that.

Jesse Gray:

The second one is what I call ized community choice aggregation. This one’s maybe most similar to what you’ve been thinking about John, but we considered municipalization, but as you know, it’s a battle. And we concluded that it was not in that ven diagram of politically possible, even though it would be potentially very impactful. Instead we looked at the history of community choice aggregation, which was invented in Massachusetts. And we have the power now to buy a hundred percent renewable electricity through renewable energy certificates in Brookline through our local cca. And so we’re looking in this article to expand the powers of CCA to first of all bring in revenue for climate action with uh, relatively small surcharge, but then also to actually do demand management because the way that you keep the cost of electrification down at the system level is through controlling demand. And the utilities are not doing enough to do that.

Jesse Gray:

There was a post, Jesse Jenkins just bought an electric car and he went through the economics and he’s gonna save money, it’s cheaper than gas, but he’s not saving as much as he should be saving because the utilities are not providing a fair incentive for off-peak car charging. And we could do that with a community choice aggregation program if the state actually allowed us to do that. So it’s about asserting municipal will through another authority that we need. The third article, article 25 is related to zoning authority in, in about 40 states, you can adopt more stringent building codes through building code amendments or related processes. In Massachusetts you can’t, we’re somewhat of a petro nanny state, even though we’re a very blue state. Municipalities in Massachusetts don’t have a lot of power compared to a lot of other states. So we’re asking for the ability to zone for climate beyond what the building code uh, zones for because while the building code has been a great instrument for climate action, it also because of the conservatism of the process of producing a building code and all the opportunities for vested interests to weigh in, it also is a barrier to climate action.

Jesse Gray:

So for example, the legislature in Massachusetts just asked for a net zero opt in, so not required but opt in for for municipalities net zero stretch energy code. And the Baker administration or Republican administration just didn’t produce an actual real net zero code. It’s a net zero code that actually allows for fossil fuel infrastructure to be installed during brand new construction. And so we’re asking for the ability to go beyond what the state does. There’s more that can be done in terms of requiring net zero and there’s more on EV charging cuz right now the brand new code doesn’t require any EV chargers to be installed in multifamily buildings. It requires something like, I think it’s 30% EV ready, but what we really need is a hundred percent of the spot in multifamily residential to have chargers because by 2035 you’re not gonna be able to buy a gasoline car in Massachusetts.

Jesse Gray:

So you’re building a building today and in about a decade it’s not gonna be very helpful for the people who live there. That’s the third one. The fourth one is Article 26. It includes a methane tax with an income-based exemption and it also allows the gas utility getting back to David’s earlier point to actually finance electrification and rate base electrification and on bill finance electrification. So financing appliances in individual homes. And the idea is that instead of replacing a gas line, let’s say on a street with a cul-de-sac, for example, the gas utility could electrify all of the homes and could actually base that on bill finance that and we could save a lot of money because that’ll often be cheaper than replacing the gas line. We have very leaky gas pipes in Massachusetts. The fifth home rule petition is a property tax. So in Massachusetts we have an established program called the Community Preservation Act.

Jesse Gray:

We modeled it after that, but this is a property tax surcharge that would have an exemption based on income. So people who make more than two to $300,000 a year would pay this property tax and people who make less than that would not, they would be able to exempt themselves from this. And then the final article is an excise tax. So in Massachusetts everyone pays an excise tax on their car. There’s a depreciation schedule, it’s based on the assessed value of the car and it’s $25 per thousand dollars of value. And it’s actually paid locally, administered locally. So we are doubling that for gasoline cars that are assessed at $30,000 or more. So in this one, it’s not, the exemption’s not based on income, it’s based on someone who chooses to buy a brand new car that is assessed at 30,000 or more can probably afford to pay double the excise tax to fund climate action and especially installation of EV chargers in multi-family buildings, which is a huge barrier to people getting an electric car. So those are the programs in detail.

John Farrell:

This is great. Thank you so much for the overview. I’d love to actually get all the article numbers. So I had Article 21, which is the one based on modeled on the septic betterment, but these electrification betterment, what was the muscular I ccca what article is that?

Jesse Gray:

John Farrell:

1. And then 25 was the zoning authority, which is giving municipalities more flexibility around the the building code. You mentioned how the state one, for example, doesn’t include EV chargers from multifamily. You have Article 26, which is the methane tax with the income based exemption, which one is the property tax and the excise tax.

Jesse Gray:

28 is the property and 29 is the exi.

John Farrell:

We’re going to take a short break when we come back, we ask about the idea of asking for local authority rather than for state mandates. We talk about the philosophy of the plan’s approach to local funding, the future of natural gas companies and the challenge of confronting potential unintended consequences in building electrification. You’re listening to a local Energy Rules podcast with zero Carbon Massachusetts co-founders, David Mendels and Jesse Gray.

John Farrell:

Hey, thanks for listening to Local Energy Rules. If you’ve made it this far, you’re obviously a fan and we could use your help for just two minutes. As you’ve probably noticed, we don’t have any corporate sponsors or ads for any of our podcasts. The reason is that our mission at ILSR is to reinvigorate democracy by decentralizing economic power. Instead, we rely on you, our listeners, your donations not only underwrite this podcast, but also help us produce all of the research and resources that we make available on our website and all of the technical assistance we provide to grassroots organizations. Every year, I l SR’S small staff helps hundreds of communities challenge monopoly power directly and rebuild their local economies. So please take a minute and go to i lsr.org and click on the donate button. And if making a donation isn’t something you can do, please consider helping us in other ways. You can help other folks find this podcast by telling them about it or by giving it a review on iTunes, Stitcher, or wherever you get your podcasts. The more ratings from listeners like you, the more folks can find this podcast and ilsr other podcasts, community broadband bits and building local power. Thanks again for listening. Now back to the program.

John Farrell:

And just to be clear, like all of these policies are opt in for cities, right? You’re not saying cities have to do this, you’re just simply the legislature would be passing them and giving cities permission to take these different actions, right?

David Mendels:

That’s right, that’s right. The strategy initially is to pass this in Brookline and ask for the right to do it in Brookline and then it’ll still have to go back through our town meeting. And then our goal will be to get lots of towns and cities to pass this. Um, and again, following on the pattern of how we did gas bands, the hope is we go from one town to 10 to 15 and then the state says, okay, let’s do something like this statewide. But it’ll certainly start only towns that wanna do it will do it.

John Farrell:

You mentioned the Ann Arbor referendum or ballot initiative that passed raising money for climate and clean energy in that city and that it was based on a property tax. We did a couple of interviews a number of years ago on this podcast with folks from Portland, Oregon and Seattle, Washington and their climate funds were based on, in one case I think it was, and Seattle, a surcharge on high earners. So they were targeting like tech workers who make hundreds of thousands of dollars a year and it was sort of like an extra income tax on those very high earners. And then in Portland it was a tax on very large retail operations, basically big chain stores that operate also in Portland. Have you thought at all about I, it sounded like currently there isn’t permission to do that. That was one of the questions I had for folks out there was what other cities have that kind of capability? Have you thought about that as a model of giving some additional taxing authorities or is the idea, it sounds like a lot of these taxing authorities are based on existing programs and so maybe you didn’t wanna crack open something new when you had something already existing to model on.

Jesse Gray:

Yeah, so the climate strategy is about navigating existing law and trying to make what need to feel like incremental changes to the legal structures that we have in place rather than oblating entire areas of law. So the more similar that programs can feel to existing programs, the legally stronger they will be. And in Massachusetts we have a pretty significant constraint that I don’t know if any other states have certainly probably most of them don’t, which is that we have a constitutional ban on progressive taxation in Massachusetts, believe it or not,

John Farrell:

<laugh>. Wow, that’s unexpected.

Jesse Gray:

Yes. So that is one of the constraints we’re navigating. I should say that we just had a ballot initiative pass it, it actually barely passed, but it was called the Fair Share Act. And it actually, it is a constitutional amendment allowing a very narrow and specific exception. It’s a millionaire’s tax. But aside from that, which was very narrow, we still face this problem. So the taxation that I described is very intentionally progressive, but it’s also written in a way that is consistent with some of the limited types of progressive taxation that we have been allowed to do in Massachusetts.

John Farrell:

That’s so interesting about how you have to sort of thread that needle and interesting as well the way that you’ve been able to find these other programs to model the climate and energy based policies on. I was interested in circling back to this question about the gas company. So it sounds like some of the things, in fact one of the particular measures that you mentioned, the methane tax was gonna allow the gas company as well to do electrification investments. You know, I assume that you’re familiar with heat, H E E T, the non-profit that does work around this, like geothermal microgrids was the initial name, now I’ve heard it called network to geothermal.

Jesse Gray:

Of course, yeah.

John Farrell:

Is that part of what you’re thinking was is that gas companies could basically be providing the replacement network or were you thinking that they were just helping with the en bail financing individual property owners? I mean, tell me a little bit more about how you’re thinking about changing the incentives for the gas company too as you, I think David mentioned earlier like even if there’s a bunch of good people at the gas company right now, the rules make it really hard for them to do the right thing. Are you making it easier for them to do the right thing?

David Mendels:

Yeah, that that is exactly the goal, but we’re not focused on one specific implementation like network geothermal. Network geothermal is gonna work well in some places that have the right mix of off outputs and outputs of heat into the system. But it’s not gonna work well for everyone. It’s not gonna work well in every neighborhood. So we want the option for them to be able to install an individual home install heat pump and put that rate base that put that on the bill to the extent network geothermal takes off. Great, that’s fine. We want them to have multiple options. We don’t want ’em to be locked into a particular implementation path because we don’t think at the moment there’s one that works for every home.

Jesse Gray:

Yeah, and I, I would just add, I mean Audrey Schulman and saying them MAGA at heat are brilliant, what they’re doing is amazing. They have one perspective on a strategic question of great importance and that strategic question is how do you work with the gas companies under the circumstances? Do you fight them, do you collaborate with them or where on the fren me spectrum do you stand with gas companies? So they have taken the approach of collaboration and they are providing the gas companies with a new monopoly or allowing them to keep the kind of monopoly they have, but it’s also somewhat of a form of solutionism. So for example, we had legislation passed called the Drive Act in Massachusetts last summer and that’s how we got this gas band pilot program. But also in the same legislation was some of the policy that HEAT has been advocating for for several legislative cycles now that would encourage gas companies to be able to, instead of replacing a gas pipe to install network geothermal.

Jesse Gray:

But as David said, and I would go even a little further, I think network geothermal is gonna be applicable in probably a small minority of cases and in most cases my expectation is that it would be more practical to just electrify homes using air source or non-network geothermal heat pumps. Our focus has been on expanding, stepping back from what some people would call solutionism where you’re only allowing one solution and allowing any kind of solution since we don’t know what will work best in what situation. So we’d like to see the gas company be able to help also, I don’t wanna give them a new monopoly, I am interested in cooperating with them. But one of the ideas that I find really intriguing that started to get a little more traction these days is that in Massachusetts in most cases we have a separate gas utility and electrical utility.

Jesse Gray:

So in addition to just the challenges of electrifying every building, we have about 12,000 buildings in Brookline. There’s the challenge of planning that transition at the level of the electrical grid and that requires some coordination between gas and electric. But those are two different companies and there’s no incentive for them to work together on this and they’re not working together on this. When one home requests, uh, electrical upgrade like mine when I converted to all electric, the electricity utility in this case Eversource, they install just enough additional capacity for my house. They’re not planning for the other 12 homes that are operating off the same transformer to electrify. So we do need to work with the utilities. One of the interesting ideas that’s come up lately is why don’t we allow them to merge? Why don’t we actually allow the gas and the electric company to merge with each other? So it’s one company, why don’t we facilitate that transition so that they’re not taking customers away from one company and giving them to the other? Cuz that’s just a bad setup for electrification. So I think heat has really expanded the conversation. They’ve brought a lot of imagination and they’ve really emphasized the importance of how do you get the utility excited to collaborate with you. And they’ve totally succeeded in that, which has been a really delightful to see.

John Farrell:

I would love to ask you a little bit more, not about that particular technology, but what is so intriguing to me about their approach is that the gas network is a form of socialized energy delivery, right? We all contribute something to it. We all are able to connect our devices, our furnaces, our hot water heaters, our dryers to that network, and we all pay in somewhat through the amount that we pay for gas or a fixed charge on our bill to maintain that system. What makes me nervous about a transition that is uncoordinated, and you’ve kind of highlighted here a couple of issues, right? That the gas and the electric utility are separate, that they’re in some ways actually competing here is that you have several potential unintended consequences of going about this. One is that the people who are less likely to take action to electrify get left on the gas network as it becomes more expensive to maintain.

John Farrell:

Like if you’re not dismantling it as you go, if it’s not that example of the cul-de-sac that you gave, but as instead individuals just electrifying their homes, which we want to happen, but maybe in an uncoordinated way. Now there’s people left on the gas network and you still have all the costs of maintaining the gas infrastructure, but you’re removing certain customers who have helped paid for it. And then the secondary issue I see is, and this gets to your thing, Jesse, that you mentioned about your own experience, right? Eversource is not planning very well for what’s gonna happen with electrification. And what makes me nervous about a whole bunch of air source heat pumps, for example, in a cold climate and I’m from Minnesota, is the amount of electrical load if that’s not managed well, like the new power plants that would be required to provide electricity in the winter months could be really extraordinary because unfortunately although he pumps can work in the winter down to the coldest temperatures, they’re a lot less efficient at that temperature and their electric demand can rise.

John Farrell:

And so if we can’t manage that, I mean you’ve already talked a little bit about this, but I, I think that when I think about avoiding solutionism, but I’m, I’m thinking about sort of the principles at stake here. There are some of these really big questions about grid management, about managed decommissioning of the gas grid that are really challenging as far as this goes. And I think it’s one of the things that is exciting about the role of a city is that a city sitting in neither of those silos but thinking about kind of all of its residents and businesses maybe has a chance to think across those lines.

David Mendels:

Yeah, yeah, just you made the point earlier, I think you said that having the monopoly based on the end use, which is, you know, heating a home or versus uh, based on the technology makes a lot more sense. And in a sense the city has that view of all the homes in its purview. The key is, while heat addresses that very nicely heat, H E E t, not heat, if it’s not the most efficient technology for a given block or a given house, then it’s still not the right thing to do. You still need to come up with an efficient way to do it. And so there’s a technical question of when is network geothermal gonna work well, when is it gonna be just more efficient to do an individual home with a air source heat pump or ground source pump? And so we don’t want to conflate those two issues.

David Mendels:

The technical issue and the political issue, the general approach that we’ve taken so far is to say, let’s let the gas utility get involved in electrification. Let’s let them finance and bill and rate base the electrification of a home. And that can be through network geothermal or through an individual home. From our perspective, I think there is much more to do and as Jesse pointed to, should emerge the utilities, the gas and the electric, that would make a lot of sense so that the electric side can out pay for the deficits on the gas side as we move forward and so on and so forth. The one of the things I just wanna address is one of the things that some of our detractors have they bring up is this whole death spiral question, which is, well, if we electrify too quickly, the people left on the gas network are gonna have to pay for the whole thing.

David Mendels:

And yeah, we’re gonna have to deal with it. We’re gonna have to deal with it through programs and subsidies to move people on. Our approach in Proline has been to be very focused on the affordable housing segment within our community. It’s a relatively wealthy town, but we do have affordable housing here. And so that’s being electrified first in many cases. So there’s a lot we need to do, but for those detractors, the answer isn’t, well let’s keep burning carbon <laugh>. You know, you still have to address the fundamental problem and then you have to address the things that, the unintended consequences of that as well. You can’t just say, well, because there’s these other consequences, we’re just not gonna address the problem. That doesn’t help anyone. And it certainly doesn’t help the lower income people who might be less than the gas pipeline who are most affected by the public health impact of all this burning of fossil fuels in buildings

Jesse Gray:

In some cases. You just have to get moving. You can’t be in think tank land where you’re planning a new regulatory structure that’s never gonna actually pass. And that’s where a lot of the activity is happening. And it’s so disappointing to see that. So one of the things that we’re gearing up for here in Brookline is we are just going to pick some neighborhoods and we are gonna electrify them so that the gas line can be shut off, for example, on a street with a cul-de-sac. And in so doing, we will have to confront all of these issues on the ground in the same way we confronted them when we electrified our own homes. And we will find whatever collaborators we can at Eversource in this case to try to manage that. But yeah, I mean there have been some modest success stories. So for example, Vermont Gas has what I think is still a pilot program, but they have a team of like 20 people who install heat pump hot water heaters, and the financing is on your gas bill from Vermont Gas, even though these are electric and they actually go in and install them themselves.

Jesse Gray:

So that’s an example of providing a role for the gas company that the gas company in that case at least was, was excited about. But yeah, there there’s a, there’s a lot of problems to solve here and if the pressure’s not coming from the bottom up, it’s just gonna take a lot longer. It makes a huge difference if a municipality starts asserting itself. I think we’ll see Boston starting to do that too. There was just a report commissioned by the Boston Foundation on their climate progress and one of the four biggest areas they need to focus on according to the report is utility planning.

John Farrell:

That’s amazing. I’d love to hear that. That is how cities are thinking of their role. Any last thoughts? We are in a remarkable time and we unexpectedly got a, a progress at the federal level on climate clean energy for the first time in over a decade with the Inflation reduction Act. As you mentioned earlier, Jesse, it doesn’t really obviate the need for cities to do things because it mobilizes money, but it, it counts on cities, estates and other actors to actually put that into practice. Any last words or advice for other cities, other communities that are struggling with these same problems about how they can take advantage of that, but also how they can can make some change at the local level?

Jesse Gray:

I think the first thing is so many of us don’t think about the local level. And you know how your brain has different amounts of real estate devoted to different functions, right? So visual animals have a much bigger fraction of their brain devoted to their visual processing, then less visual animals. And in the same way, like we tend to give attention where there’s news coverage. So because there’s so much federal news coverage and state to a lesser extent state news coverage and especially now, I mean our local paper was just shut down in Brookline. So little local coverage that when people think about politics, they don’t even think that. A lot of them don’t even have any idea what form their local government even takes <laugh>. And local government for itself is often just very focused on keeping the lights on, keeping the sewer system running.

Jesse Gray:

And that’s a very different mentality. So one of the things we’ve experienced is when you come in and start shaking things up and and trying to have a more entrepreneurial approach and a more politically assertive approach, it can be challenging, but the first step is just to get people engaged because you can make a lot more progress. An individual can make a much bigger difference by getting involved in local politics. Politics is what’s holding us back on climate. It’s not technology, it’s not policy. We don’t need more think tanks, we need people engaged in local government pushing.

John Farrell:

Thank you so much Jesse and David, thank you as well for joining me to talk about what municipal action that you are pushing forward in Massachusetts. And we will love to check in and to hear about the progress of that legislation you’re talking about, to give cities more flexibility and more opportunity to exercise that local muscle in the pursuit of clean energy and climate progress.

Jesse Gray:

Thank you, John, for all that you do. Keep it up.

Speaker 2:

Thank

John Farrell:

You so much for listening to this episode of Local Energy Rules, where I was joined by Zero Carbon Massachusetts co-founders David Mendels and Jesse Gray to talk about their efforts to give cities more power over their energy and climate future. With the Municipal Climate Empowerment Program, you can learn more about Zero Carbon Massachusetts at www.zerocarbonma.org. Jesse and David encourage you to reach out to learn more or to collaborate. We’ve also linked to the six legislative proposals or articles that are part of the Municipal Climate Empowerment program mentioned during the show. On the episode show page. You’ll also share those links as well as a link to our annual community Power Scorecard where we rate states for their policies giving communities more power over their energy future. For reference, Massachusetts was one of just four states to receive an A in our 2022 scorecard. These scores and the underlying policies can always be found on the Institute for Local Self-Reliance Interactive Community Power Map. Local energy rules is produced by myself and Maria McCoy with editing provided by audio engineer Drew Bach, tuned back into local every two weeks to hear more powerful stories of communities taking on concentrated power to transform the energy system. Until next time, keep your energy local and thanks for listening.