Senate panel OKs bill allowing Efficiency Vermont to subsidize heat pumps

A Senate committee Wednesday approved a bill to allow the state’s energy efficiency utility to subsidize residential electric heat pumps.

The bill, S.202, allows Efficiency Vermont to cover part of the cost to install efficient air-source heat pumps in residences that meet certain thermal efficiency standards. The Vermont Public Service Board, the state’s utility regulator, will work with the company to ensure the installations do not raise electricity rates.

The company collects money from ratepayers’ utility bills to subsidize thermal and electrical efficiency projects. The energy efficiency charge is designed to save ratepayers more money than they pay into the fund by reducing the need to upgrade the state’s electrical transmission infrastructure – a cost passed on to ratepayers.

The Senate Natural Resources and Energy Committee was concerned the company’s original proposal would increase rates by placing added electricity demands on the region’s electricity grid. But the latest version of the bill is designed to require recipients of the subsidy to meet certain energy performance standards, which includes thermal efficiency, according to George Twigg, a lobbyist for Efficiency Vermont.

The utility said it will work with customers and utilities to control electricity usage by dialing the heat pump’s usage up and down during appropriate times.

“Outside of times of peak demand there’s a fair amount of unused capacity on the grid currently. So as long as we’re being attentive to working closely with customers and utilities on issues around demand management to avoid the peaks, there’s actually a lot of unused capacity that could be put to use for Vermonters’ benefit,” Twigg said.

Sen. Robert Hartwell, chair of the committee, said the bill must go to the Rules Committee for approval (because it was voted out after the crossover deadline to move bills from one chamber to the other). The bill could also be attached to other House bills that pass through the committee.

Heat pumps are a technology used 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 during the coldest winter months.

John Herrick

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