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2019 feebate pitch presentation
- 1. HEATING FEEBATES: DRIVING UPTAKE IN CLEAN HEATING EQUIPMENT PURCHASES ENERGY ACTION NETWORK ENERGY & CLIMATE SUMMIT September 26, 2019 Gabrielle Stebbins, Energy Futures Group
- 2. What is a “Feebate”? 2 “Fee” “Bate” Penalizes inefficient, dirtier options Rewards cleaner options Revenue Neutral Changes behavior at time of purchase
- 3. Heating Equipment Feebate 3 Fee applied to all fossil fuel (FF) heating equipment & inefficient electric baseboard systems Rebate provided to ENERGY STAR® or equivalent • All cold-climate heat pumps • All wood heating systems (except outdoor wood boilers) Approach • Fee implemented by Tax Department • Rebate implemented by…CEDF? Efficiency utilities? Department of Public Service? • Refund available for low-income Vermonters • Set aside portion of revenue to hire 1 state staff to assist fuel dealers (e.g. trainings, business transition plans)
- 4. Feebate Analysis: Revenue 4 $0 $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 $8,000,000 $9,000,000 $10,000,000 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Feebate Collections and Spending Example Fossil Fuel System Fee Collections Non-Fossil Fuel System Rebate Spending Cumulative Net Balance of Fund
- 5. Feebate Analysis: Equipment 5 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Annual Sales of Heating Systems in Vermont (Preliminary Estimates for Discussion Only) Efficient FF Systems Inefficient FF Systems Wood Heat Systems Heat Pumps 43% 4% “NET ZERO DESIGN”
Editor's Notes
- Who I am & EFG. What my pitch is about. Art Rosenfeld (1926-2017) has been widely credited as the founder, or “grandfather”, of energy efficiency as we know it today. He proposed and coined this idea of a “feebate” in the 1970s. This photo captures Rosenfeld receiving the 2011 Medal for Technology & Innovation.
- Feebate is a portmanteau of "fee" and "rebate“ Portmanteau is a linguistic blend of words,[1] in which parts of multiple words or their phones (sounds) are combined into a new word,[. A self-financing system of fees and rebates that are used to shift the costs of externalities onto those market actors responsible (Wikipedia)
- Disclaimer: Modifications and further refinement of this proposed approach is welcome. Inefficient electric baseboard was not actually included in the analysis – but should be in future analyses and program concept/design. Heat pumps include air-to-air, ground-source and air-to-water.
- Assumptions: FYI …#s are somewhat old (e.g. 2016 National Sales data) System cost estimates from ECVT 20% fee on inefficient FF systems and 10% on efficient FF systems (increasing by 1% point per year) 2020-2030 Flat 8% rebate applied to clean options Assumes no change in pricing Assumes overall market growth at .5% (HP at 9%, wood heat at 2% and FF systems at -15%) Provides rebate to all three wood heat technologies (stove, wood, AWH) Does not assess whether the changed equipment is full replacement or just displacing a portion of FF heat
- Between 2020 – 2030, % of annual sales is: FF: 43% drops to 4% Wood: 30% increases to 36% Heat Pumps: 27% increases to 60%
- Next steps include: Additional analysis (cost-benefit analysis, identifying fee and rebate amounts, economic impact, local job opportunities?) Significant stakeholder outreach Clarifying the concept (who does what, how much, by when) to draft statute Pass legislation Refine program design and begin implementation