Published in Energy

‘Electrify everything’: Rural cooperatives can help decarbonize the power grid, advocates say

BY Sunday, January 19, 2020 05:00pm

Ric Evans has yet to find the electric stove he wants to install in his rural Northern Michigan home, but everything else inside is powered by electricity, including the water heater and an air source heat pump.

Unlike many rural Michigan residents, Evans — a clean energy policy specialist with the Traverse City-based Groundwork Center for Resilient Communities — doesn’t heavily depend on propane or other deliverable fuel for heating. He and other advocates hope Midwestern residents can make a similar transition to electric-powered home equipment as a way to save money in the long term and decrease carbon emissions.

Ric Evans, Groundwork Center for Resilient Communities COURTESY PHOTO

Electric cooperatives remain a key player in the movement known as “beneficial electrification.” The organizations serve customers in sparsely populated areas not covered by the major electric utilities DTE Energy and Consumers Energy.

Last year, Evans co-authored a report by RE-AMP on the potential for beneficial electrification among rural cooperatives and municipal utilities. RE-AMP is a network of 130 Midwestern nonprofits advocating the elimination of greenhouse gases by 2050. The group’s “Deep-Decarbonization Framework” states: “Include everyone, electrify everything, and decarbonize electricity.”

The report found that while more can be done, Midwestern electric cooperatives are increasingly pursuing beneficial electrification, offering a variety of programs and incentives to help members make the switch. Three hundred co-ops in 12 Midwestern states serve about 3.7 million members.

In addition to emission reductions, benefits to electrification include more efficient home equipment and energy savings compared to propane- and gas-powered models. Advanced, connected technology also can help utilities balance the power load during periods of high demand. 

But with costs to electrify and make homes energy efficient ranging in the thousands of dollars, the remaining question is how this move can be possible on a widespread, equitable scale. 

“That’s the million-dollar question,” Evans said.

That’s also where utilities can step up with rebate programs, loans or other incentives that defray the upfront costs. On-bill financing, for example, allows loans to be repaid through energy savings.

“Strong systems through the utilities are the most important piece for really widespread adaptation and acceptance,” Evans said.

‘Beneficial for all’

Electrification, or fuel switching, is a controversial and costly concept, particularly in the Midwest where nearly one-fifth of all energy used in rural homes is propane. 

At a meeting of the U.P. Energy Task Force in Marquette last month, Michigan Public Service Commissioner Dan Scripps said “ideas around fuel switching” — in the context of reducing the Upper Peninsula’s reliance on the Line 5 pipeline — “tend to be hugely controversial at this point.”

But electrification also is seen as a catalyst for tackling climate change, particularly as more renewable energy is added to the grid. Electric vehicles are another form of electrification.

In 2018, the National Rural Electric Cooperative Association unanimously approved a resolution supporting beneficial electrification programs.

At least two Michigan electric cooperatives say they’re focusing on electrification programs for customers.

“For us, it’s really tied to responsiveness to the people we serve who are asking us for this,” said Rachel Johnson, member relations manager at Grawn-based Cherryland Electric Cooperative. “It’s not driven by the utility as much as it’s driven by members.”

The Traverse City-area cooperative has offered rebates for electric vehicles, electric water heaters and heat pumps since October 2018, Johnson said. Cherryland has issued about $200,000 of these rebates since then. A benefit to electrifying home equipment and transportation, Johnson added, is being less reliant on deliverable fuels that are more prone to price volatility.

“(Electrification) is an area we’re paying a lot of attention to,” Johnson said. “We see this as an opportunity partially because of the power supply portfolio we have to help members clean up their carbon footprint while at the same time helping them invest in newer technologies or equipment for their home.”

Beneficial electrification is a “strategic focus” in 2020 for Cadillac-based Wolverine Power Cooperative, said co-op Vice President Joseph Baumann.

“Beneficial electrification, as the name suggests, provides many benefits for our members,” he said. “It’s a way to further decarbonize. It can help us manage our grid more efficiently with intermittent renewable generation resources. Economically, beneficial electrification also enhances our ability to manage load and reduce costs. … In short, transitioning to electric technologies can be beneficial for all.” 

Serving low-income members

Evans at Groundwork Center said a key aspect to electrification should ensure low-income co-op members and utility ratepayers have access to these programs. These residents often need home efficiency upgrades the most but also face a comparatively higher energy burden, meaning they pay a higher percentage of their income for energy.

If structured correctly, though, utility loan programs can be “cash positive” at the start, with more energy savings per month than the loan payment, Evans said.

Johnson said Cherryland’s energy efficiency rebates have been specifically designed for low-income members, and noted the co-op also plans to launch a community solar program for low-income members.

“One of our main focus areas is creating programs that don’t leave people behind,” she said.

Michigan co-ops also are uniquely positioned to pursue electrification. Cherryland and Wolverine, for example, each have electricity portfolios with more than 60 percent carbon-free sources, which include renewables and nuclear power.

“We’re helping (members) meet their personal clean energy goals,” Johnson said.

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