{"id":23889,"date":"2024-03-11T13:08:21","date_gmt":"2024-03-11T18:08:21","guid":{"rendered":"https:\/\/blogs.edf.org\/climate411\/?p=23889"},"modified":"2024-03-11T13:08:21","modified_gmt":"2024-03-11T18:08:21","slug":"clean-heat-standards-an-effective-climate-policy-for-the-thermal-sector","status":"publish","type":"post","link":"https:\/\/blogs.edf.org\/climate411\/2024\/03\/11\/clean-heat-standards-an-effective-climate-policy-for-the-thermal-sector\/","title":{"rendered":"Clean heat standards: an effective climate policy for the thermal sector"},"content":{"rendered":"
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Downtown Boston<\/strong>. Photo: Emmanuel Huybrechts via Wikimedia Commons<\/em><\/figcaption><\/figure>\n

This post was co-authored by Chris Neme<\/a>, Co-Founder and Principal of Energy Futures Group<\/em><\/p>\n

The concept of a Clean Heat Standard (CHS) is gaining traction in multiple jurisdictions as a way to drive larger, faster reductions in the thermal sector\u2019s greenhouse gas emissions. At least ten U.S. states are considering the policy, with Colorado and Vermont having enacted legislation and Massachusetts and Maryland considering a CHS regulation.<\/p>\n

A new report<\/a> commissioned by Environmental Defense Fund and prepared by Energy Futures Group<\/a> provides an overview of key design elements that can be used for a CHS, as well as a look at how four states are approaching these elements in their own CHS development process.<\/p>\n

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While CHS deployment is still in relatively early stages, there are already opportunities to learn from the varying approaches different jurisdictions are taking in structuring and implementing the standards, and to compare various policy approaches and program design details.<\/p>\n

What is a Clean Heat Standard<\/strong><\/p>\n

A CHS is a performance standard that requires thermal fossil fuel suppliers to deliver a steadily increasing percentage of low-emission heating services to customers. That means that there is at least some level of flexibility in terms of which mix of measures is used to meet emission reduction goals.<\/p>\n

Compliance with a CHS is demonstrated through a \u201cbottom up\u201d tallying of estimated emission reductions from individual measures such as heat pump installations, weatherization jobs, and sales of different types of low-emission fuels.<\/p>\n

The importance of reducing emissions from the thermal sector<\/strong><\/p>\n

Existing policies to reduce emissions associated with heating buildings and completing various manufacturing and industrial processes are important, but more is needed to drive emissions down at the pace and scale required to address climate policy goals.<\/p>\n

Climate policies in the U.S. have generally been more heavily focused on the electricity sector \u2014 and, increasingly in recent years, the transportation sector. As progress is made in reducing emissions in these two sectors, policy makers are beginning to turn to the challenge of reducing emissions from the third largest source of emissions, the thermal sector.<\/p>\n

Ideal CHS design elements<\/strong><\/p>\n

Our new report identifies nine key design elements that contribute to an effective CHS. These include the standard\u2019s scope, size, who is obligated to participate, examples of activities that could be covered by credits, how credit values should be set, how they can be traded, how to build in crucial equity provisions, and how to measure and verify compliance with market rules.<\/p>\n

Going into more detail, the report identifies how each of these key design elements should ideally work. For example:<\/p>\n