Building electrification plan will reduce greenhouse gas emissions to help meet California’s carbon neutrality goals

Southern California Edison, a leader in the transformation of the energy sector, is proposing to create healthier, clean energy homes and businesses by reducing the use of carbon-emitting fossil fuels in buildings through the installation of about 250,000 electric heat pumps across its service area.

If approved by the California Public Utilities Commission, the overall plan would provide $677.2 million for programs to help accelerate the growth of the building electrification market over a four-year period to reduce greenhouse gas emissions and improve indoor air quality.

“Building electrification represents a vital opportunity to reduce GHG emissions and is the area of the California economy where the least amount of progress has been made,” said Steven Powell, president and CEO of SCE. “This program will accelerate the widespread adoption of electric heat pumps as a first step toward removing the use of fossil fuels in homes and other buildings.”

The plan includes incentives for the installation of electric heat pumps in existing homes and buildings since gas furnaces are one of the largest sources of GHG emissions from buildings. Unlike furnaces that burn fossil fuels to produce heat, heat pumps use electricity to send heat where it’s needed and remove it where it’s not. They offer a two-for-one benefit: heating and air conditioning from the same equipment. In addition to providing incentives for electric heat pumps, the plan also provides retrofit assessments and incentives for necessary electrical infrastructure like panel and/or circuit upgrades.

The actions laid out in this plan will ultimately benefit all SCE customers though reduced GHG emissions, downward pressure on rates and less energy usage due to increased efficiency of electrical equipment. It prioritizes income-qualified customers and environmental and social justice communities that are disproportionately affected by indoor and outdoor air pollution, extreme weather and climate change. About 81,000 electric heat pump installations and at least 40% of electrical upgrades are specifically for income-qualified customers and environmental and social justice communities.

SCE’s plan also includes a comprehensive market education initiative to address one of the key barriers to widespread technology adoption — lack of knowledge about the availability and benefits of building electrification technologies. In addition to providing climate and health benefits, UCLA’s Luskin Center for Innovation estimates that, in general, the electrification of buildings statewide is expected to create more than 100,000 jobs in California in the construction, energy and manufacturing industries.

Reducing emissions from the use of fossil fuels is critical to addressing and mitigating climate impacts as outlined in SCE’s Pathway 2045 blueprint for achieving carbon neutrality. SCE estimates that 70% of space and water heating needs to be electric by 2045 to meet the state’s ambitious clean energy and carbon neutrality goals. Additionally, SCE’s parent company, Edison International, concluded in Mind the Gap: Policies for California’s Countdown to 2030, that the trajectory of programs and policies supporting building electrification is insufficient to achieve California's GHG emissions target, resulting in only 47% of the residential and 30% of the commercial 2030 milestones being achieved. SCE’s plan would close a meaningful part of this gap.

About Southern California Edison

An Edison International (NYSE: EIX) company, Southern California Edison is one of the nation’s largest electric utilities, serving a population of approximately 15 million via 5 million customer accounts in a 50,000-square-mile service area within Central, Coastal and Southern California.

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