Efficiency Vermont looks to expand services to heat pumps, electric cars

An electric vehicle charging station near the state capitol in Montpelier. Photo by John Herrick/VTDigger

An electric vehicle charging station near the state capitol in Montpelier. Photo by John Herrick/VTDigger

Some lawmakers were caught off guard when the state’s energy efficiency utility pitched a plan to go into the business of air-source heat pumps and electric cars – technologies that use more electricity but cut down on fossil fuel emissions.

“What does the future hold in 10 years?” said George Twigg, director of public affairs for Efficiency Vermont, a subsidiary of the national company Vermont Energy Investment Corp. “We don’t necessarily know,” he continued.

Early this session, the utility presented the Senate Finance Committee with a proposal to penetrate the budding industry of electric cars.

“What is an electric car except for a big appliance on wheels?” Twigg said. But lawmakers had little appetite for the proposal to expand the utility’s offerings.

Later, the utility came before the Senate Natural Resources and Energy Committee with a proposal to install heat pumps in homes – a technology to heat homes in mild weather at a third of the cost of propane and half the cost of heating oil. (Heat pumps are not designed to replace traditional heating sources.)

The committee was hesitant to approve the plan. Questions remain over how much demand the new technology would put on the state’s electricity grid and how much it actually would save residents, details the utility would work out later with the Vermont Public Service Board, Twigg said.

But the opportunity to enter the market is now, he said.

“Most of the time there is a huge amount of capacity not being used,” he said, referencing the state’s power grid. “That excess capacity could be used to bring economic savings to Vermonters.”

Sen. Bob Hartwell, left, and Darren Springer, deputy commissioner of the Vermont Department of Public Service. Photo by Johnny Herrick.

Sen. Bob Hartwell, left, and Darren Springer, deputy commissioner of the Vermont Department of Public Service. Photo by John Herrick.

Sen. Bob Hartwell, D-Bennington, chair of the Natural Resources and Energy Committee, which has been asked to approve the plan, wants to see the state invest more money in insulating old homes before Efficiency Vermont takes on new technologies. Vermont has the second oldest housing stock in the nation.

Hartwell introduced a bill, S.202, designed to put more money into weatherizing Vermont’s buildings. The bill, which died in committee, was a platform that would have allowed Efficiency Vermont to get into the business of heat pumps. Green Mountain Power is starting a heat pump pilot program in Rutland.

Committee member Sen. Mark MacDonald, D-Orange, said the low cost heat pumps would undermine the incentive to invest in thermal efficiency.

According to a February report by the Department of Public Service, propane and heating oil costs $46 million and $34 per million British thermal units (MMBtu), respectively. Heat pumps cost $14 per MMBtu, about equal to wood fuel.

“If you cut the cost of heating your home in half, you just cut in half the homeowners’ savings of doing thermal (efficiency),” he said. “That is what makes this a quirk,” MacDonald continued.

And that is why the committee wants homes sealed up before heat pumps are installed. But the utility does not think that will always be practical given customers’ financial realities.

The utility’s new paradigm may use more electricity – some of which would be generated from renewable energy sources – but save residents money, Twigg said.

“If you can displace a good portion of your propane or oil use with a heat pump, you save a lot of money and you also reduce your carbon footprint dramatically,” he said.

This model works as long as it does not put unnecessary stress on the state’s power grid, he said. The utility proposed working with Green Mountain Power, the state’s largest electric utility, to manage peak demand on the grid.

The committee is auditing the utility. Part of this review is to discover why so few private businesses are retrofitting their buildings.

All businesses, except IBM, pay into the state’s energy savings account, which is money generated from an energy efficiency charge on ratepayers’ bills. Larger businesses can choose to keep 70 percent of these funds for energy efficiency projects. Any remaining money goes to Efficiency Vermont.

According to a December 2013 report by the Department of Public Service, approximately 300 customers qualify for program funds, but few businesses have the resources and staff to embark on energy efficiency projects.

Since the program was launched in 2009, two businesses have made energy efficiency improvements. The committee wants to know why more are not taking advantage of program.

“I thinks it’s a fair thing for the Legislature to ask, and we would be glad to take part in this understanding why more aren’t participating,” Twigg said.

Darren Springer, deputy commissioner of the Department of Public Service, said the department wants to know why so few businesses use the money. He said it could be due to a lack of awareness of the program or the funding scheme.

The committee OK’d a bill Tuesday to allow the department to study the program.

Efficiency Vermont ended the year with a $4 million budget surplus, about 12 percent of the utility’s 2013 budget. The money was raised from the energy efficiency charge. The utility has requested authority from the Public Service Board to carry the surplus over to the following year.

Twigg points out that the utility operates on a three-year budget cycle, and the surplus comes in the budget’s second year.

He said the company has a good track record of ending with a balanced budget every three years. Also, Twigg said, “we are actually ahead of pace on meeting performance goals in terms of energy savings.”

John Herrick

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  • Ok, I really have a problem with this. I install pellet boilers and Efficiency VT, has cried poverty for the last three years and can only give a $1,000 rebate. Our pellet boilers cut the heating bill by 50% if you burn oil and 60% if you burn propane. Whats wrong with this picture? The wood comes from our own forest and provide incomes to our neighbors. NH has a program to pay up to 30% of the installed cost up to $6,000. It’s a no brainer. We’re all paying into efficiency VT with every monthly electrical bill but we never seem to get the money back. Dan Davis

    • Jim Barrett

      I say : government butt out and don’t give anyone money for this program. Why should I pay for anyones heat or heating systems when I have to pay for my own. Just another welfare program and that includes my$7,500.00 I have to pay for someone to buy an electric vehicle. Shumlin shuts down the least expensive source of electricity (VTY) and now we are being forced to pay for this government program…..everyone should pay their own bills for a change.

      • Bob Stannard

        Mr. Barrett, I believe Entergy shut their plant down because it was no longer affordable thanks to low energy prices

        • Willem Post


          Thanks to low NE grid prices, but Vermont household electric rates are the fourth highest in the US, right after Connecticut, Hawaii, Alaska.

          Vermont Yankee was selling its energy at grid prices that were too low to make money, hence, it had to shut down.

    • Mark Whitworth

      Dan: Pellet boilers are a far more sensible choice for most Vermonters than air source heat pumps. People may not realize it, but the heat pumps under discussion are not central heating systems, cannot operate in Vermont without a backup heating system, and do not provide domestic hot water.

      Maybe if your pellet boilers used more electricity and they could be used to justify the construction of industrial wind turbines they would be more attractive.

    • Moshe Braner

      Dan: if your pellet boiler saves you so much money, why do you want a government subsidy for it?

      I didn’t get a subsidy for my wood stove – nor my heat pump. Both save me money on propane.

  • Annette Smith

    What a strange world we are living in. Efficiency Vermont advocating for electric cards and heat pumps. Since I live off-grid with solar I have a real world way of understanding how much power an air source heat pump uses, along with the wattage of all my appliances.

    Anything over 1000 watts is used for short periods of time, like the vacuum cleaner. Cappuccino machine at 700 watts runs for maybe 5 or 10 minutes. Washing machine at 700 watts runs for half an hour. LED lights use 3 to 5 watts. TV set and computer about 60 watts. Blender, mixer, all those kitchen appliances don’t run long when used.

    But I do not have an electric microwave or toaster oven, I do not use electric space heaters. Anything that involves creating heat uses exponentially more power. Motors also use more electricity at start-up, but again that is a relatively short period of time.

    I was curious how much electricity air source heat pumps use, so did a fair amount of searching and also asked Efficiency Vermont on its Facebook page. The first response was to call them. So I posted the information I found, and that resulted in them responding, essentially confirming my research.

    I was shocked to learn that air source heat pumps use on average 2500 watts, and that is a continuous power draw. It can go as low as 300 watts and up to 3000 watts or more. It runs all the time.

    So then I asked my science guru how much I would have to expand my perfectly adequate electric system to incorporate a heat pump. About 4 times.

    Now multiply this times thousands of Vermonters, and add in the electric car fantasy. I really do not understand what the people meeting behind closed doors to “plan” our energy future are thinking. But it definitely will help GMP cope with losing customers to people like me who choose to live off grid.

    Go buy that $3500 heat pump (one for each room) and get hooked on it and while yes, the numbers work now for reducing your overall energy bill, wait until all the renewables come into the mix and electricity gets much more expensive and you need more of it because you are hooked.

      • John Greenberg

        Your source says: “The operational cost of nuclear power in existing plants is very competitive with alternatives. In 2012 it was 2.4 c/kWh, compared with gas 3.4 c/kWh and coal 3.3 c/kWh.”

        The capital costs of nuclear plants, on the other hand, are not low and neither are the costs of disposing of the waste and decommissioning.

        Wind and solar cost almost nothing operationally; virtually all of their costs are capital costs.

        • Willem Post

          About half of their levelized operating costs are offset by subsidies abpnd write offs. That is the reason wind turbine owners and their supporters can crow about wind energy being so low in cost that it is competitive with coal, gas, nuclear, but many costs are not even counted, such capacity adequacy, ie., having energy 24/7/365, and balancing costs, and transmission system augmentation.

          • John Greenberg


            “About half of their levelized operating costs are offset by subsidies abpnd write offs.” [sic]

            The key word here, folks, is “levelized.”

            Because virtually all of solar and wind’s costs are actually up-front capital costs, they are often “levelized” over the expected lifespan of the project, which is what Willem is calling “levelized operating costs.” Otherwise, first year costs would be enormous for any of these projects, and costs for every subsequent year would appear to be virtually zero. So there’s nothing wrong with levelizing project costs.

            Except that, as might be expected, it entirely misses the point to which Willem is responding. MJ Farmer quoted an article referring to 2.3 cents OPERATIONAL costs for nukes. This figure is NOT levelized, and does NOT include the capital costs of nuclear plants, which, as I pointed out above: “are not low and neither are the costs of disposing of the waste and decommissioning.”

            In other words, the comparison between energy types can be made EITHER by comparing levelized operating costs to levelized operating costs or by comparing ALL costs to ALL costs, but NOT by comparing operational costs to ALL (as MJ Farmer was proposing) OR by comparing operational costs which do not included capital and disposal costs to “levelized operational costs” which do, as Mr. Post suggests.

            As to subsidies, we’ve been down this road many times. The nuclear industry has benefited and continues to benefit from numerous subsidies at every governmental level. Singling out those of the wind and solar industries and then comparing them to no subsidies at all for other energy sources is completely specious and intellectually dishonest.

          • Willem Post

            My comment was directed at only the wind turbines.

            I should have mentioned it.

      • John Greenberg

        “My comment was directed at only the wind turbines.”

        It’s still misleading about wind turbines, and for the same reasons.

        • Willem Post


          Because of production underperformance (poor New England winds, even on ridge lines) and increased capital costs, and likely shorter life than the 25 years assumed, and high O&M ($250,000 blade repair jobs), GMP’s Lowell will have a heavily-subsidized energy production cost of about 15-20 c/kWh, instead of the 10 c/kWh GMP testified before the DPS, with grid prices at 4-5 c/kWh!

          Add enough of such variable, intermittent, i.e., junk energy, to the grid, including grid augmentation, capacity standby and $10.5 million synchronous-condenser systems, and Vermont electric rates will be even higher than they are now, i.e., 4th highest in the US.

          But GMP will not suffer, as it will include all of its extra costs in rate increase requests, which will likely be high-fved by the PBS.

  • Matt Fisken

    Why is Efficiency Vermont auditing Green Mountain Power? Maybe it’s to look into why Mary Powell reported GMP’s line losses are 30%. Wouldn’t it be ironic if they found that some of this lost power was due to the poor power factor (less than 0.5) of the CFLs Efficiency Vermont (practically) gives away, subsidized by our the 1¢/kWh tax?

    If EV was really interested in saving customers money, they would stop collecting the EV charge from customers who are using less than 600 kWh/month.

  • Wayne Andrews

    EV is not interested in saving individuals money but rather blow hot air when you save electric usage. Saving usage does NOT translate into saving dollars when you factor in the costs of retrofitting and the EV charges on your monthly bill.
    Now EV delves into another area??? Sounds like big govt thinks the people know nothing and it continues to grow and grow because to them us rubes no nothing.

    • John Greenberg

      “Saving usage does NOT translate into saving dollars when you factor in the costs of retrofitting and the EV charges on your monthly bill.” Please document your statement.

      I’ve read a number of studies of energy efficiency. They all include ALL costs and show that saving usage DOES translated into saving dollars.

      Everything I know therefore suggests that your statement is blatantly false.

  • Bob Zeliff

    Technologies change…heat pump technology has substantially improved. It is time to take advantage of it.

    While heat pump technology is not yet to the point where it can replace other sources, fossil fuels or wood, it is now much closer.

    I’m closely looking into this technology to get reduce the 800 gallons of heating oil I use every year. If I can cut 200 or 300 gallons and save money too it make sense from a renewables stand point. The question does in make sense from a hard dollars and cents stand point. Not sure of that!

    • Willem Post

      Bob, see my below comment.

      I obtained the information from a company that sells and installs heating systems, including heat pump systems.

      The owner of the business recommends AGAINST air source heat pumps in Vermont.

      You would be so much smarter to insulate and seal your home. You would get better results, save more money, at a very low cost.

  • Don Peterson

    Dear Efficiency Vermont:

    We need to revise the way we bill electricity so that people who use less pay less, instead of paying more via monthly fixed charges.

    And whats wrong with letting people with lower utility usage opt out of EV? It rewards good practice. If you really want to improve efficiency, reward people who use it wisely.

    P.S. Unfortunately, to an outsider your budget surplus explanation sounds rather lame. While I agree 100% with your mandate to improve efficiency, I think you could do a better j0b of returning value to ratepayers.

  • Jamie Carter

    I’m all for the EV program, but the current implementation of that program sucks. They should dump Mr. Twigg and find someone else to run it, because he is not doing a good job.

  • Laurel Stanley

    Once again I ask that nonprofits who own old buildings be included in these discussions. Is it only businesses that can use part of the EV charges for insulating their bldgs? I think so. Any time this kind of discussion crops off nonprofits are ignored. Yet we own old churches, libraries, historical society houses, community bldgs, etc.

  • Moshe Braner

    If we are serious about balancing the peak electricity demand vs the “excess capacity” at other times, we should charge more per KWH at peak times. Now that we have “smart meters” it is time to do that. As it is, with flat per-KWH residential rates, those who use a lot during peak times (air conditioning) are subsidized by the rest of us.

    And I agree with the comments above that lower-usage accounts should pay less, either less per KWH, or less in the fixed monthly fee. Exempting the first xxx KWH per month from the efficiency charge (also suggested above) may make sense, but is practically meaningless, since it’s a percentage of usage, if you use less you don’t pay much in that charge. OTOH the fixed monthly fee has risen over time, and (when I don’t use the heat pump) it’s now about 40% of my monthly bill! That’s an incentive AGAINST conservation.

    • Matt Fisken


      GMP offered a pilot program to do just this. I don’t think it worked very well (or we’d be hearing more about it). Something about paying 4 times more per kWh for some of your electricity doesn’t seem like a real “incentive.”

      The truth is, we don’t need smart meters, in home devices, or any harmful microwave transmitters to know when power is more expensive and when it is best to conserve. ISO New England’s dashboard will tell you the spot price of power in Vermont/NE in real time. When it gets over $100, that’s a good time to wait on doing that load of laundry or cooking that turkey.

      While using ISO’s dashboard as a guide doesn’t technically save you money, it does allow you to know when the grid is being stressed. It’s unlikely your AC or heat pump will be the straw which breaks the camel’s back, but it’s still worth being aware of when spot prices/demand are high.


      VELCO’s demand can also be monitored here (not working at the moment):


  • Wow! just about every one of these posts contain inaccurate information or are not looking at the whole picture, or both.
    1.- Pellet boilers are still relatively inefficient and put combustion gases and wasted heat into our atmosphere. Although pellets are less expensive, it takes a lot of energy to process and deliver them. Many people do not have a place to put a pellet boiler, never mind space to store the pellets (unless they install an outside storage bin),
    2.- Nobody is paying for someone else’s heating system. The very small surcharge on your electric bill is helping to pay for an incentive for someone else (which could be YOU) to install a high efficiency heating system, rather than one that just wastes more energy and puts more junk into our atmosphere. The majority of Vermonters are doing little to curb their energy consumption to battle global warming. These incentives, taxes and government policies are what will encourage people to act. [BTW- the typical incentive is about 10-15% of a project’s cost, which saves power customers at least that much in not having to build more power plants or expand the electric grid].
    3.- If you are living off of the grid, you are not paying into the energy efficiency fund, not using the electric grid and having no impact on electric generation for the rest of us. Hopefully, you are off-grid for holistic reasons. Most people that are off-grid just can’t (or won’t) afford the cost of running power to their property. A heat pump is sort of like an air conditioner or refrigerator. It moves heat from one place to another, using a refrigerant of some sort. In the winter it takes heat from the outside air and pumps it inside. When the outside air temp. is lower than roughly 20 deg., a heat pump doesn’t move much heat, so they have a backup electric heater. You don’t have to use the electric heat. You could use your original heating system and have the heat pump turn off when it gets very cold. The heat pump uses a small amount of electricity to run the fan and compressor. A heat pump will also cool the house in summer, much more efficiently than your window air conditioner.
    4.- Efficiency Vermont (EVT) is NOT auditing GMP. A Legislative committee is.
    5.- The power factor of installed CFLs has a very negligible impact on GMP’s line losses.
    6.- The energy efficiency charge on electric bills is charged per KWh used. The less you use, the less you pay.
    7.- Nonprofits are eligible for the same benefits and incentives from EVT as any other business. The incentive is to save energy for everyone.
    8.- If you are using ANY electricity from the grid, you are contributing to global warming and the need for power production and distribution. That few dollars a month ($3-6 for a typical household) is the cost for beginning efforts to combat the effects of many decades of wasting energy. It was very common a few decades ago for utilities to offer lower rates for using major electric loads (mainly electric hot water heaters and electric storage heat), but those have disappeared because they were costly to implement and maintain. With the advent of Smart Meters, we will see implementation of peak/off-peak billing.

    I do not work for EVT or VEIC, but I am a contractor who has worked with EVT for several years helping people to get EVT and income tax incentives while saving them energy, saving them money on their energy bills and helping to combat global warming. I have also have worked with EVT and several other groups to help to educate the public about the many facets of using and saving energy.
    “Always look at the whole picture!”
    “The more you look, the more you see!”

    • Matt Fisken

      Thanks Brad,

      Re: 4. You are correct. I misread that part of the story.

      Re: 5. CFLs have more of an impact on the grid than those who install/sell them believe/claim. If the purported savings of CFLs are having any impact on the grid, then their poor power factors certainly are as well. EVT’s “9 watt” CFLs require 20 watts to be generated and transmitted. When you factor in the poor power quality generated by these bulbs, the average Vermonter would be much better off using a 29W halogen incandescent, which has a power factor of 1.0 and does not negatively impact power quality, contain mercury, have an unnatural light spectrum, etc, etc.

      We should all be billed for the power we require to be generated and transmitted. Using CFLs to save money and passing the buck to the rate base—for everyone to pay—is a scam.


      Even with a reduction in amperage, electric utilities must still correct for the THD caused by devices with power factors less than 1. To do so, they either add capacitors to the distribution system as close to the load as possible or increase generation capacity. A study from New Zealand estimates that correcting for low power factor electrical devices could cost electric utilities as much as $4 million for every million low power factor CFL bulbs installed. “Utilities have to compensate for this low-power factor distortion by purchasing more capacitors,” says LeMay Madden.

      • John Greenberg

        You quote one expert cited in the article, but not the others: “Some experts say that single-phase residential systems only require minimal corrections by the electric utilities. The harmonics generated by electronically ballasted, screw-base CFLs, as severe as they are, are essentially “no sweat,” especially in residential applications, says Oliver Morse, formerly with the Lighting Systems Research Group, Applied Science Division, Lawrence Berkeley Laboratory, Berkeley, Calif. According to Morse, in homes there is enough resistive load from electric ranges and refrigerators that, when combined with the low power factor devices, make corrections a non-issue. “Dirty power and harmonics are less of a problem in single-phase systems than in 3-phase systems,” Morse says. “There’s enough clean power consumed by motors driving refrigerators, fans, air-conditioners, and electric ranges.”

        The power distribution system acts as giant low-pass filter, according to Morse. Transformers contain inductors, and transmission lines have inductances and parasitic capacitances that tend to reduce harmonics as reflected back through to the generation system. “I would guess that the utilities don’t even see it at the generation station,” Morse says. “Only the transformers in the local neighborhoods — where the harmonics are generated — would see it, so they should take some readings. But I would not be awfully worried about it. It’s such a small percentage of the total load.””

        • Matt Fisken


          Thanks for keeping me honest.

          I am fully aware that most within the industry dismiss these problems as “no sweat.” They have allowed them to happen and don’t have the humility to to accept responsibility. Plus, tacking more and more equipment onto the grid guarantees more work, higher rates and increased profits. Similar to the upgrades being made to support PV arrays in places they really should not be.


          I think it’s funny how you’ll write about small contributions to renewable energy having significant impacts (as far as reducing CO2 emissions), but refuse to consider that the accumulating “side effects” of these technologies are having an effect as well.

          Of course, we could debate all day about whether these side effects are “significant” (a subjective term), but the oft touted claim that “CFLs generate the same light using 75% less power” is 100% false and should be a red flag for anyone paying attention. Luckily, the end user of these lights experiences most of the resulting issues, but as I’ve said, poor power quality, line losses, and unnatural/unhealthy lighting in public places has a trickle down effect on everyone, even those who wisely stick to incandescents, halogens and LEDs in their homes.

          Lastly, what is the power factor and power quality at your house with a number of lights on?

          • John Greenberg


            I do not “refuse to consider that the accumulating “side effects” of these technologies are having an effect as well.”

            You keep bringing up the same effects, and what I’m finding suggests, as does my reading of the source you link to, that this is NOT a problem in anything but a theoretical sense. When DOE or the utilities or the grid operators raise the issue, I’ll be happy to take it into consideration. My guess is, however, that if the problem develops to that point, the manufacturers will, as the article you cite suggests “produce(d) … power factor-corrected CFLs” to resolve the issue before it becomes a problem requiring the attention of lay folk like me.

            I have no idea what the power factor or power quality of my house is, nor do I care.

    • Hattie Nestel
  • Willem Post

    $46 and $34 per million for propane and fuel oil are spot prices for households that do not have a pre-paid season contact, or are not part of a buying group. Most households do

    I am part of a buying group and bought 1200 gallon of propane for $1.86 per gallon.

    Air source heat pumps are only suitable in moderate climates. They would be very inefficient, i,e., energy a hogs, during cold winter days, as the temperature difference between the evaporator and the outdoor air would be small, meaning there would be little heat transfer from the air to the indoors.

    Ground source heat pumps are suitable for Vermont, but those systems require a house to have in floor heating piping, instead of baseboard heating. Heating a concrete floor basement would also require in floor heating piping. Such systems are are least $20,000 a $30,000 to install

    • Bill Gallip


      I think you meant to say forced air rather than floor heating.

      I had an 3 ton open loop system (draws from and discharges to the aquifer) when I lived in Virginia and had the lowest energy bills in the neighborhood. Granted it didn’t get as cold as in VT, but it shouldn’t have been much of a problem for a well insulated house. Most systems installed today are closed loop using something akin to antifreeze as their working fluid, and I’m sure they are more efficient than my circa 1980 system.

      • Willem Post


        You are in the right location for heat pump systems. Low electric rates, half of New England, and a moderate climate.

        Yours is water-sourced. They can have ducting for distributing the heat and cold air, which is old fashioned, takes up space, makes noise, and is wasteful. Better to have in-floor and in-ceiling piping, so-called hydronic systems.

        This winter was rather cold in Vermont. Only modern mini-split heat pump systems would have been able to operate at such low temperatures, albeit, inefficiently. Better to shut them down and use a back-up, non-electric heating system during cold periods.

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