Building Decarbonization and the Future of Natural Gas

Synapse helps our clients understand the ongoing and upcoming transitions in the building sector as jurisdictions pursue decarbonization policies. We help our clients understand building technologies and markets, assess and design policies to make buildings more efficient, and develop strategies to achieve an equitable, thoughtful, and proactive transition to a decarbonized future.

We draw upon our expertise in utility regulation to provide expert analysis and assessment of the implications of this transition for gas utilities, including gas infrastructure planning, financial strength, and ratepayer implications. We are particularly attuned to the potential for inequitable outcomes for communities already facing energy burdens and the need for proactive programs and planning to mitigate risk for these customers.

Building Decarbonization

GHG emissions in the electric sector have been declining and increasing electric vehicle sales raise the prospect for declining emissions in the transportation sector. In contrast, the decarbonization path for the building sector has only recently been receiving attention commensurate with the sector’s emissions. Synapse has been leading the analysis of the future of building systems in a decarbonizing world:

  • We developed our Building Decarbonization Calculator (BDC) to track equipment changeover and market transformation timelines, and then to project what is necessary to hit state or national GHG emission reduction targets.
  • The BDC incorporates a consumer adoption model to evaluate the impact of fuel prices and incentives on the rate of adoption of low-carbon systems like heat pumps.
  • We provide analysis and testimony on rate designs that are just and reasonable for customers with efficient (and potentially flexible) electric loads.
  • We evaluate building performance data and assist policymakers with the design of decarbonization policies, such as building performance standards and building codes.
  • We evaluate utility energy efficiency and building electrification programs to measure their performance against policy objectives and best-in-class programs.
  • We evaluate the impact of electrification on the electric grid, including on winter peak demands on the electric generation, transmission, and distribution systems, and the value of flexible loads as grid resources.

Future of Gas

Technological changes such as the development of advanced cold climate heat pumps, coupled with state and local climate change mitigation policies, are beginning to transform the future of regulated gas distribution companies. And it is driving new approaches to gas utility infrastructure planning. Regulators, utility leaders, and advocates are all assessing the impact of increased competition from electricity and emission reduction imperatives. Synapse assists clients in this area by:

  • Assessing the need for gas system capacity expansion (such as new gas transmission lines);
  • Planning for and evaluating non-pipeline alternatives;
  • Evaluating utility plans, including business plans and supply plans, within the constructs established by local and state policies and goals;
  • Assessing the potential role for lower-carbon gases like renewable natural gas, hydrogen, and synthetic natural gas;
  • Modeling the finances of regulated gas utilities and their unregulated affiliates to understand business models, objectives, risks, and impacts on customer rates; and
  • Assessing the implications of the changing policy and business context for utility-run gas and electric efficiency programs.