Written by BDC and Sunstone Strategies
Wow, what a year! 2024 has been marked by significant advancements in building decarbonization policies, growing consumer demand for electric technologies, and the continued expansion of the building decarbonization movement.
Record-breaking heat, storms, and flooding have highlighted the urgency of our work, and while the U.S. election results present challenges—especially for near-term federal policy progress—the momentum behind our movement remains strong.
Despite the obstacles, we are making great strides toward more affordable, healthier buildings, and our young movement is already making an outsized impact. Heat pump sales now outpace gas furnace sales. Better building codes and other state and local policies continue to be adopted. And new analysis demonstrates the financial risks for methane gas utilities that continue to invest in the fossil-fueled status quo.
So, before we turn to the challenges of 2025 and continue the fight for what communities want and need—a more affordable, resilient future—let’s take a deep breath and reflect on what we’ve accomplished in this most recent trip around the sun.
- A good omen: Induction takes center stage in 2024
The rise of induction cooktops speaks volumes about whether or not gas stoves remain a sticking point for electrifying households.
Induction’s march into the mainstream continued in 2024, with chefs like Samin Nosrat and Martin Yan sharing why they’ve made the switch to induction at home. Restaurants, including Michelin-starred One65 in San Francisco, are also embracing this technology. Induction was the talk of the town for kitchen designers at their biggest annual trade show: Design & Construction Week. This is indeed a kitchen revolution for all.
Induction’s growing popularity is backed by strong sales. National retailers Ferguson Bath, Kitchen & Lighting Gallery reported an uptick in induction sales, and AJ Madison reported that “induction accounted for 18% of all cooking sales last year, and has been growing in double digits the past three years, outpacing non-induction competitors.”
With sales up and consumer interest growing, we at the Building Decarbonization Coalition have built a community of 45 chefs from around the country who are ready to introduce local communities to this state-of-the-art cooking technology and share information about available incentives and resources.
Chefluencer Four, Training at the Food Service Technology Center in Irwindale, CA (2024).
Induction cooking’s superior performance, faster boiling times, and ease of cleaning have won over consumers. Its dominance is further solidified by growing research highlighting the health risks of gas stoves. In 2024, new data continued to emerge, including the fact that gas stoves are responsible for 19,000 premature deaths annually in the U.S. due to increased indoor pollution. A Stanford study found that long-term nitrogen dioxide exposure from gas and propane stoves “is responsible for approximately 50,000 current cases of pediatric asthma” and that “the total number of current pediatric asthma cases attributable to pollution from gas and propane stoves is likely closer to 200,000.” This study also amplifies recent research on the environmental injustices and inequities associated with the methane gas distribution system, as it demonstrates how low-income households and communities of color are more likely to experience the health harms of gas and propane stove pollution.
These health risks are driving increased consumer backlash, with households and designers naming gas stoves an outdated home trend.
- Heat pumps: Bringing the heat (and the cool)
Last year we named heat pumps the “shining star” of their class, and in 2024 they’ve gone Red Wine Supernova.
Named one of the breakthrough technologies of 2024, heat pumps are clearly having their moment. Simply put, everyone’s pumped about heat pumps. The market now has so much more, with a Google alum designing heat pumps, the window heat pump unit, and the rollout of even more efficient cold climate heat pumps. Choose your own adventure!
Consumers have made their choice. Heat pumps outsold gas furnaces once again, and by no small margin. In the last 12 months, heat pumps outsold furnaces by 27%, widening the gap by 2.4% compared to the previous 12-month stretch.
Not only are heat pumps climbing the sales charts, they’re climbing the music charts too. Check out this steamy heat pump love song penned by The Switch Is On ambassadors Michael T. Roberts and Will Hammond Jr.
- Speaking of steamy…
Electric water heaters have long outsold gas water heaters, and this market shift continued into 2024 with an 8% growth in electric water heater sales over the last 12 months, surpassing sales of their gas counterparts by 23%.
And consumers are particularly interested in efficient electric heat pumps. Heat pump water heater sales outpaced gas storage water heaters for the first time in 2023, as shipments grew 35% to 190,000 units, the largest numerical increase (50,000 units) in heat pump history. (Heat pump figures for 2024 won’t be available until Q3 of 2025 but we suspect the trend will continue!)
- Innovation makes going electric easier than ever
Going electric is becoming easier than ever with new plug-and-play technologies introduced in 2024:
- Split system heat pump water heaters reduce the need for venting and exhaust in small spaces where the tank can be separated from the outdoor units.
- 120V window-mounted heat pumps (from Gradient and Midea) and battery-equipped induction stoves (from Copper and Impulse) can be installed with no additional wiring and minimal labor.
- State partnerships are supercharging the market
States are stepping up and “basically begging you to get a heat pump.” Nine states and Washington, D.C. made a huge bet on heat pumps in 2024, committing to ensuring the technology makes up 65% of HVAC sales by 2030 and 90% by 2040. California launched the Heat Pump Partnership this year, a groundbreaking alliance that brings together leaders in the public and private sectors to rapidly scale California’s heat pump market. These targets support last year’s U.S. Climate Alliance commitments made by states that together represent 54% of the U.S. population.
These commitments provide clear market signals to manufacturers to double down on heat pump production. This and the funds rolled out via the Defense Production Act position the HVAC market for transformation that will drive greater innovation, diversity in models, and lower price points.
- Incentives are landing!
Federal incentives from the Inflation Reduction Act (IRA) are set to drive sales of efficient electric equipment. As of December 1st, 51 states and territories have applied for $6 billion in IRA funding to launch electrification rebate and incentive programs.
Source: https://www.energy.gov/save/rebates
In many cases, these federal incentives can be stacked with other federal, state, and local incentives. For instance, in July a collection of Northeastern states were awarded $450 million in federal funding through the EPA’s Climate Pollution Reduction Grants program to supercharge heat pump adoption.
A report released on the IRA’s impact found that from the second half of 2022 through the first half of this year, business and consumer investment in clean energy technologies totaled $493 billion, a 71% increase from the two-year period preceding the legislation. This supercharged expansion of the market will continue to yield positive benefits regardless of whether Congress rolls back future clean energy incentives (although clearly, the more incentives that we can bring to bear, the better).
- States take on energy affordability
No one should have to choose between paying their energy bill and heating and cooling their home. Thankfully, some households are about to receive relief from high energy costs with new electrification and weatherization programs set to roll out for low-to-moderate-income households. In addition, states are protecting households from utility shut-offs during extreme weather events.
Bills that helped extend a lifeline to energy-burdened households in 2024 include:
- D.C. established a Healthy Homes Program to install electric appliances in low- and moderate-income households.
- Connecticut expanded the role of the low-income energy advisory board to develop weatherization assistance and utility rates as well as provide recommendations related to low-income energy services.
- IL, ME, and VA were all able to pass legislation to protect against utility disconnections during extreme weather.
Other states are working to make energy bills more affordable by limiting energy burden in relation to income. For example, the NY HEAT Act is an in-progress effort to protect low- and moderate-income families from energy burdens greater than 6% of their income.
- HUD/USDA ensure affordable, climate-resilient housing
Many homes are still built to outdated standards, making them drafty, costly to heat and cool, and less safe during extreme weather events. For example, homes built to 2021 International Energy Conservation Code (IECC) standards can stay comfortable twice as long than more drafty homes during power outages. With 45% of heat-related deaths occurring indoors, this issue is more critical than ever.
To protect residents’ health and safety, we must build homes that can withstand the climate risks of today and tomorrow. And greater energy efficiency requirements have the added benefit of encouraging the adoption of electric equipment and appliances. In 2024, steps were taken to make this a reality for some of our most vulnerable residents with a decision by the U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of Agriculture (USDA) to adopt modern energy-efficiency standards for the construction of new single and multifamily homes. This decision will impact up to a quarter of all new homes nationwide, cut energy bills by a third, and save households an estimated $524 annually through lower energy costs.
- Cities and states are taking bold action
In 2024, the movement for healthier, resilient buildings remains strong with cities and states continuing to pivot their approaches to advance sound climate policy.
In 2024, legislatures in thirty states (including Washington, D.C.) introduced 130 bills that would further building decarbonization goals by reducing greenhouse gas emissions, improving air quality, making homes and businesses more resilient, protecting communities from the extreme effects of climate change, and prioritizing the workers who make a clean energy transition possible. Of these, 35 bills in 15 states and D.C. became law – representing 27% of bills introduced.
Notable actions include:
- At the eleventh hour, Massachusetts passed a comprehensive climate bill to move away from its reliance on methane gas by revising the state’s gas pipeline replacement plan to allow utilities to decommission gas pipelines and replace them with thermal energy networks (TENs) and other non-gas-pipeline alternatives. It also grants the state’s regulatory commission broad authority to determine whether new and existing gas service should be allowed or continued when adequate clean energy alternatives are available.
- Five states (WA, CA, MA, MN, and NY) introduced bills to reform “obligation to serve” statutes, enabling neighborhood-scale decarbonization.
- Fourteen bills sought to align gas system planning with greenhouse gas emission targets (“future of gas”).
- Three states (IL, NJ, and RI) introduced bills to create new Clean Heat Standards.
- Eleven states proposed bills to protect consumers from methane pollution and energy disruptions during extreme weather.
The progress in 2024 also extends to cities and states pivoting their approaches to advance healthy, resilient buildings. Track the progress on our Zero-Emission Buildings Ordinance tracker, with standout efforts including:
- In September, California adopted an energy code that will ensure the vast majority of new homes are equipped with heat pumps for both space and water heating. The code also begins to tackle pollution from existing buildings by including provisions to upgrade to heat pumps when replacing gas rooftop units on commercial buildings, which account for approximately one-quarter of all commercial HVAC units in California.
- Nine new communities in Massachusetts have adopted fossil fuel-free building standards for new construction and major renovations. In addition, since 2023, forty-eight communities representing 30% of the state’s population have voted to adopt the Specialized Code encouraging all-electric new construction.
- Ten communities in California have updated their new standards to encourage all-electric new construction.
- Maryland leadership shines with executive action on equipment standards
Maryland is taking the lead in tackling building pollution, with Governor Wes Moore announcing an executive order in June to implement a zero-emission heating equipment standard (ZEHES) for newly purchased heating equipment. This would make Maryland the first East Coast state to pass such a measure, following a similar measure adopted in California by the Bay Area Air Quality Management District last year.
- Regulators take note of skyrocketing gas pipeline costs
Gas utilities are facing greater regulatory scrutiny, driven in part by advocates who have stepped up as ratepayer watchdogs and are raising the alarm on utility spending that could drive an energy affordability crisis.
In October, Oregon utility regulators ordered NW Natural to stop charging ratepayers for lobbying activities and to phase out subsidies for new gas hookups by 2027. This was followed by an order from Colorado utility regulators for Xcel Energy to stop charging customers for lobbying expenses, investor relations expenses, trade association dues, and attorney and consultant fees.
One of the biggest drivers of increasing gas utility rates is the fact that the gas pipelines under our feet are aging and nearing the end of their useful lives. In fact, nearly a quarter of the underground pipelines in the U.S. gas system are over 50 years old. Replacing these pipes can cost up to $6 million per mile, and gas utilities are pouring $33 billion a year (according to the American Gas Association’s own calculations) into this outdated energy system rather than redirecting this investment to build the clean energy system of the future.
Such spending has caught the eye of regulators in recent years. In June 2024, the D.C. Public Service Commission paused the third phase of Washington Gas’s “Project Pipes,” which sought to spend $670 million on new gas pipes in D.C. over a five-year period. This was the third installment in an ongoing pipeline replacement that had an estimated cost of $4.5 billion.
- More states cut line extension allowances as scrutiny on gas subsidies grows
Another key driver of escalating methane gas costs are gas line extension allowances (LEAs), which are when gas companies extend the gas system to new customers free of charge by billing the larger customer base for those pipeline extensions.
Ending such practices can save ratepayers a lot of money–in California it was estimated that ratepayers saved $164 million annually when regulators ended gas LEAs. In New York, where advocates are still working to remove these incentives, it’s projected that ending LEAs would save ratepayers $200 million annually.
Gas LEAs were drastically reduced or removed in two additional states over the course of 2024, moving the total to nine states that have removed these subsidies state-wide or in specific utility territories:
- California is incentivizing all-electric buildings by allowing subsidies for electric line extension allowances only when they are connected to all-electric buildings.
- In October, Oregon’s Public Utility Commission directed NW Natural, the state’s largest utility, to eliminate its gas LEAs for new residential customers by 2027. With Avista already slated to do the same, this will leave only Cascade with residential gas LEAs in effect in the state.
- States begin to plan for a future without gas
Utility regulators have begun taking a close look at the future costs of the gas system (and costly it is!) to ensure an affordable energy future for all. Strikingly, a third of the U.S. population now lives in a state or jurisdiction with a Future of Gas regulatory proceeding, and just this last year we saw 11 states introduce 14 Future of Gas bills that sought to align their state’s climate targets with gas system planning.
- 35+ neighborhood-scale decarbonization projects greenlit in 2024
Image: The Electric Network and Thermal Energy Network Pathways for Neighborhood-Scale Building Decarbonization
As states more deliberately aligned their climate targets with their decarbonization plans, 2024 brought with it a wave of neighborhood-scale clean energy projects. That’s because replacing old methane pipelines is costly, and many communities found upgrading to clean energy alternatives is more affordable than new investments in the outdated gas system.
In 2024, California, Colorado, and Washington passed legislation to support at least 35 new neighborhood-scale building decarbonization projects. When combined with projects already underway in the U.S. by utilities, universities, communities, and organizations, there are now at least 125 neighborhood decarbonization projects in progress (or soon to be) across 34 states, and quite likely, coming to a neighborhood near you.
Image: BDC’s Neighborhood-Scale Building Decarbonization Map
- Bringing the heat [beneath our feet]
The neighborhood-scale building decarbonization technology that the media are talking about the most is thermal energy networks (TENs). While the technology is new to most, its resilience and cost-effectiveness are beginning to win over communities, policymakers, and utilities.
2024 was the year TENs really took off.
This year we saw the launch of the first operational utility-owned thermal energy network from Eversource Energy in Framingham, MA. The pilot is already projected to save customers 20% in energy costs and reduce greenhouse gas emissions by 60% compared to the old gas system.
More neighborhood-scale, utility-owned thermal networks are on the way, with 28 gas utilities representing 45% of all gas meters in the U.S. working together to strategize how to best manage the transition off of gas.
And the path is already being cleared for more TENs to come online, with 23 bills across 12 states introduced and eight bills passing to allow electric and thermal energy options for decarbonizing whole buildings and neighborhoods, committing utilities to pilot these projects to reduce their emissions and save ratepayers money.
- 2024 delivered JOBS, JOBS and MORE JOBS
A well-trained and well-paid workforce is critical to building the clean energy future we all need and deserve. Nationwide, we’ve seen 330,000 new clean energy jobs since the IRA passed and a projection of 1.1 million new electrification jobs by 2035.
Still, our nation needs MORE electricians, contractors, and HVAC workers, and federal investments have been delivered in 2024 for training for these clean energy careers.
TENs in particular provide a promising path forward, as they create new jobs for pipefitters and electricians while retaining existing utility jobs.
- Capturing the future
In 2024, the building decarbonization movement scored impressive wins that set the pace for future progress.
Our big tent movement is growing with expanded support in 2024 from nonprofits and local governments to utilities, unions, manufacturers, and chefs. BDC’s membership grew 25% this year.
And make no mistake: Our movement is thriving because it’s focused on creating the future we all need and deserve. Regardless of who occupies the White House or controls Congress, the demand for efficient, clean energy technologies keeps growing.
The movement is growing because stakeholders are seeing both progress and opportunity. We see a future where all can thrive, and we’re building that future together.