Peter McPhee Director of Renewable Heating & Cooling Programs September 17, 2016 Clean Heating & Cooling: Opportunities and Incentives

The MassCEC Mission 2 Cultivate a robust marketplace for innovation in clean technologies Build sustainable industry to create jobs, long- term economic growth Accelerate cost reduction for clean energy technology Support training and education to build a skilled workforce

Primary Heating Fuel Used Motivation for Clean Heating & Cooling MA Background Heating: 30% of MA GHG emissions MA GHG reduction goals: – 25% by 2020 – 80% by 2050 Average MA household spends $1,700 on home heating annually Areas without natural gas spend about $2,400 Massachusetts GHG

4 Renewable Heating & GHG

MassCEC Clean Heating Strategy Achieving MA GHG goals requires tens of thousands of new clean heating systems per year – starting now  August 2015: 5-year, $30 Million commitment Incentives for residential and commercial-scale clean heating: ASHPs, central biomass heating, GSHPs, solar thermal  Outreach, marketing, education, addressing industry barriers, infrastructure  Coordinating with other state agencies  Goal: support growth of industry into self-sustaining, mature market

6 CH&C Technologies Technologies Solar Thermal Biomass Heating Cold-Climate Air- Source Heat Pumps Ground-Source Heat Pumps

What is success? Grow the market significantly, but also focus on: 1.Technology maturation: higher efficiencies, proven reliability, more consumer options, high sustainability 2.High-quality installations: improved reliability and performance  Maximizing positive customer experiences  Build trust and credibility 3.Cost-competitiveness: reduction in costs (especially soft costs)  Growing competitive with fossil fuels, even with limited incentives  Competitive, despite fuel price volatility How MassCEC is working toward these goals 1.Aggressive technology standards 2. Quality control: training reqs, project reviews, and inspections 3. Performance monitoring

Air-Source Heat Pumps Residential Program: Rebates up to $6,000 Highest efficiency, cold-climate ASHPs Typically “mini-splits” Commercial-Scale Program: Rebates up to $93,750 Currently, residential-scale technologies Expanding to large-scale technologies soon Additional incentives for low- and moderate income housing 8

Ground-Source Heat Pumps Residential Program: Rebates up to $16,500, depending on size, efficiency Highest EPA efficiency ratings required Commercial-Scale Program: Rebates up to $250,000 Highest efficiency technologies Additional incentives for low- and moderate income housing 9

Central Biomass Heating Residential Program: Rebates up to $16,500, depending on cost Strict PM emissions and efficiency requirements Currently only pellet boilers Commercial-Scale Program: Rebates up to $250,000 Strict PM emissions, efficiency, and fuel requirements Pellet and wood chip boilers Additional incentives for low- and moderate income housing 10

Solar Hot Water & Solar Heating Residential Program: Rebates up to $6,000, depending on size, efficiency Typically for domestic hot water, sometimes supplements heating Commercial-Scale Program: Rebates up to $100,000 Also process, agricultural applications Additional incentives for low- and moderate income housing 11

Incentives for RH&C in other states 12 StateASHPGSHPBiomass Heating Solar Thermal General ConnecticutRes: $250- $ MaineRes: $500 Comm: $1,250 Res: $5,000 - New Hampshire Res: $2,500, funding limited Res: $10,500 Comm: $65,000 Res: $1,900 Comm: no limit Thermal eligible for RPS New YorkRes: up to $1,000 -Comm: $270k- Rhode IslandRes: up to $500 Tax credit- VermontRes/Comm: $400 -Res/Comm: $2,000/boiler Res/Comm: $950 Federal30% res thru 12/31/16, 10% comm (ongoing) 30% thru 12/31/19, less thru 2021

13 Massachusetts Clean Energy Center Clean Heating & Cooling Programs  Air-Source Heat Pumps:  Central Biomass Heating:  Ground-Source Heat Pumps:  Solar Heating and Hot Water: CH&C Hotline: