Navigating Electrification in Decarbonization: Understanding Behaviors and Challenges
By Mike Blackhurst
Introduction: "Electrification” is expected to play a key role in decarbonizing our energy system. This blog summarizes electrification, discusses its potential impact on emissions, and anticipates often-overlooked behavioral changes influencing energy transitions.
Defining Electrification: At its core, electrification involves replacing technologies that directly combust fuels with electric-powered alternatives. Picture swapping out your natural gas cooking range for an electric one – that's electrification in action.
Navigating Emission Complexities: Estimating emissions from electricity consumption isn't a straightforward task. Unlike technologies with direct fuel combustion, electricity comes from diverse power sources, each with varying greenhouse gas emissions. Meaningful emission reductions from electrification require also increasing renewable energy generation and improving power transmission to deliver this generation. If these actions aren’t coordinated, electrification may not contribute to emission reductions.
Electrification in Energy-Systems Models: Energy-systems models can estimate the costs and emissions implications of electrification by representing interdependencies among technologies and different energy sources; spatial and temporal variation in supply and demand; and the flow of greenhouse gasses from throughout the energy system. Energy system models identify the least-cost set of energy technologies that meet expected energy demands, potentially also reflecting subsidies for technology adoption or emissions constraints. Energy systems models provide valuable insights into how we could change the energy system, such as decarbonizing energy supplies, at least cost.
Behavioral Implications of Energy Models: Energy systems models can and do reflect some nuanced behaviors. For example, they can customize how people make intertemporal tradeoffs (aka, discounting) when selecting least-cost alternatives. However, behavior is a challenging blind spot in energy systems models. Cost is only one factor informing peoples’ technology choices.Think of all the different types of cars, refrigerators, dishwashers, air conditioners, boilers, and furnaces on the market. Many popular models are not least-cost. Inherent in least- cost assumptions is that consumers know all the costs and benefits of their energy technology choices and have agency. If you have ever bought a home, you likely did so without knowing how much your energy bills would be. If you have ever rented an apartment, you realize that not everyone gets to decide what kinds of appliances they use. Moreover, many people struggle with upfront costs, even if they know it will be a wise investment over the long-term. Energy systems models also make difficult assumptions related to how people use energy technologies. In particular, they assume behavior remains unchanged after technology adoption, and adoptions are mutually exclusive rather than additive. If you bought a new car that was more fuel efficient, would you put more miles on it? Research indicates that the average person would.
Challenges in Electrifying Building Heating and Cooling: These behavioral blind spots are particularly problematic in achieving emission reductions from electrifying building heating and cooling. The average consumer does not know the costs and benefits associated with electrification. Installation costs vary depending on the existing electrical panel and wiring inside and outside and the configuration and size of the house. Operating costs vary depending on the price of electricity and building characteristics. Some homeowners may be attracted to the spillover benefit of adding air conditioning to their home. However, a new electric heat pump system is considerably more expensive initially than replacing existing natural gas equipment, even if it is cheaper to operate. Sorting through this information out would take time and potentially be costly.
Concerns about inadequate peak output may lead many building owners to avoid electrification, supplement with resistant heat, or maintain duplicate existing natural gas heating systems. Removing natural gas systems altogether is expensive. Will people go through the added cost of doing so or keep them? If they maintain dual fuel systems, how will they use them and what is the impact on emissions?
Perhaps most importantly, space conditioning equipment is typically replaced when it fails, and these failures are only evident when the equipment is urgently needed. Imagine going without a heat in the middle of winter to sort out all of the above issues in order to electrify.
Why Behavior Matters: Misunderstanding behavior can lead to policy misdirection. For example, policymakers observed an "energy efficiency gap" after making widespread investments in energy efficiency. The “gap” describes the disparity between the anticipated and observed efficiency gains. Researchers have since attributed most of this gap to behavioral blind spots in the model assumptions driving policy.
The Way Forward: Energy systems models provide valuable insight in identifying least-cost decarbonization pathways. However, prior research has shown that real decisions may not be consistent with least-cost outcomes. Achieving our decarbonization goals will require that we develop a clear understanding of the behaviors driving technology adoption and use. How? We can simply study how consumers do or would choose and use new energy technologies. We can use surveys, randomized control trials (RCT), or natural experiments, all of which require deeper collaborations with social scientists. Results from behavioral experiments or surveys could be used directly in energy systems models or used to better contextualize model results. Bridging the gap between technological understanding and human behavior is key to achieving the emissions potential of electrification.