Although the electricity generation and transportation sectors account for a far greater share of greenhouse gas emissions than the residential and commercial building sector, policy makers are targeting building electrification as a means for making a significant contribution to economy-wide emission reductions. Federal, state, and local governments are using various policy levers toward this goal, creating risks for industries, such as natural gas distribution and real estate development, and opportunities for others, such as technology companies focused on smart homes and companies developing energy management systems, electric vehicle supply equipment, and heat pump equipment, and manufacturing and installation companies.

COMMENTARY

These initiatives include amendments to building code regulations and building performance standards, the establishment of electric vehicle infrastructure incentives, and even outright bans on new natural gas connections. Market pressures on the natural gas supply chain and increasing natural gas costs are further inducing commercial real estate developers, homeowners, and builders to embrace electrification as a cost-saving measure, which may well be far more motivating for some than the altruistic driver related to mitigation of climate disruption.…

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