Canada needs more heat pumps, but shift to electricity is happening

Canadians looking for home energy systems would have to buy nothing but heat pumps and heat pump water heaters by 2035 to completely change out the equipment stock by mid-century.

“In multiple really big ways, electrification can truly be anti-inflationary,” since it holds energy costs steady for 20 years once clean energy devices have been installed, said Saul Griffith. Ecotrust Canada photo.

This article was published by The Energy Mix on Feb. 23, 2024.

By Mitchell Beer

Canada will have to install hundreds of thousands more heat pumps over the next three years than current sales trends indicate to get on track to decarbonize home heating and cooling by 2050, a webinar audience heard Thursday afternoon.

But a decarbonization plan now taking shape in Australia points the way for government financing to help electrify day-to-day energy use for every household, regardless of income, save $1 trillion over an 18-year span, and fight inflation into the bargain, inventor and author Saul Griffith told an Ask Me Anything session hosted by Canada’s Transition Accelerator.

“In multiple really big ways, electrification can truly be anti-inflationary,” since it holds energy costs steady for 20 years once clean energy devices have been installed, said Griffith, founder of Rewiring America and Rewiring Australia. While artificially low fossil fuel prices are slowing down the shift in places like Canada and the United States, “some countries have already crossed the threshold where you literally can’t spend money fast enough because it saves the country so much.”

Transition Accelerator Vice-President Moe Kabbara said his organization is doing similar analysis for Canada. “It really depends on your baseline fuel costs,” he told Griffin. But in provinces or regions where fossil energy is expensive, “it’s really a no-brainer to go from heating oil to electricity.”

But to get that transition done, Canada will have to pick up the pace. Based on annual sales as a percentage of all home energy devices sold, cumulative installed capacity, and the “S-curve” that would herald rapid adoption, Kabbara said Canadians looking for home energy systems would have to buy nothing but heat pumps and heat pump water heaters by 2035 to completely change out the equipment stock by mid-century.

Other countries face the same challenge, and “that’s humbling, because it’s really fast,” Griffith said. But past adoption curves for everything from flush toilets to televisions sets show that it isn’t impossible.

It’s Already Happening

“The good news is that it really is happening in most countries,” he said. “No matter where you are, the adoptions [of new technology] are increasing, the rate of increase is increasing,” and the overall trajectory matters more than some of the temporary downturns receiving attention in recent news reports.

One obstacle, Griffith added, is the $300 trillion in future profits the fossil fuel industry has at stake if a rapid decarbonization effort succeeds. “$300 trillion is a lot of motivation to play naughty in the media sphere with misinformation, and to try to slow this down with regulation,” he said. But “globally, these trends are going in the right direction.”

Griffith said Rewiring Australia has drafted a plan that builds on the widespread adoption and low cost of rooftop solar—at 3¢ to 4¢ per kilowatt-hour, it’s “almost 10 times cheaper” than the most expensive fossil alternative, putting the country at a tipping point for rapid adoption.

While the U.S. Inflation Reduction Act was one inspiration for the Australian policy, the White House plan relies on tax credits that aren’t useful to many of the households that need them most. So Rewiring Australia came up with a plan “where government becomes the financial backstop for every household, regardless of income,” to shift from fossil fuels to electricity.

The proposal “is being taken very seriously,” he told participants, not least because a $1-billion investment in cars, water heaters, space heating, and kitchen hobs (stovetops) would save the economy $1 trillion in energy costs through 2040.

With fossil fuels, “you buy a cheap machine up front, but then you pay for expensive fuels for a long time into the future, and [the prices of] those fuels are volatile” due to external events ranging from the COVID-19 pandemic to Russia’s invasion of Ukraine. “The interesting thing about electrification is that you buy a slightly more expensive machine up front, but then you’re feeding it very cheap and very consistently-priced electricity in the future.”

Australians have already seen their household energy costs rise from $2,000 some years ago to $7,000 in 2023. But “if you electrify the vehicles, put up rooftop solar and a battery to cover about half of the electricity, which is easy, electrify heating and cooking, the ongoing energy cost is about $2,000 per year, and that cost is fixed for 20 years into the future.”

That’s what makes electrification anti-inflationary compared to volatile fossil fuel costs that “will continue to rise and rise,” he explained. “I don’t think the world’s economists get this, and as a physicist, I can’t guess why.”

‘Raise Your Daughter to Be An Electrician’

A participant asked Griffith what skills and expertise the energy transition will demand, and what he says to young people who see a scary future ahead.

“I understand the temptation for younger people to be a little bit negative. They’ve been handed a pretty tough basket,” he replied. “But we can now prescriptively say this is what we need to do. We need more engineers, because hardware is back. Everyone wants to go and write AI, but we need those old school skills like chemicals and metallurgy and electrical engineering and electronics,” so “there’s a huge amount of job security for anyone who wants to go into those areas.”

But trades training will be even more important. The professional engineering track is “a nice story for the high end of town,” Griffiths said. “But really, the heavy lifting in this transition is at the technician level. It’s the jobs that all countries ignored over the last four decades to their peril, good tradespeople jobs.”

A major problem right now, in Australia as well as Canada, is that installers who are familiar with gas appliances are selling against electrical upgrades when homeowners are in the market for new equipment. “We have to turn those people into the sales force, and that happens by really recognizing that that’s who’s going to get this done, that by far the majority of the jobs created will be in all of these skilled trade installations for all of this kit.”

In another parallel for a Canadian audience, he said Australia is still in the midst of a culture war where many contractors and tradespeople are skeptical about electrification and question whether it will create jobs. Rewiring Australia is trying to make the case by “increasing the cultural value of the actual work force that’s going to get this job done,” positioning skilled trades as the real heroes and “giving them the central role in this societal transition, rather than just being the person who shows up to install the thing.”

So for students and younger workers, “yes, if you’re about to graduate from a nice university, please go into engineering, or at least go into policy-making to make better policy,” Griffith said. “But even more important, raise your daughters to be electricians and contractors.”

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