Research Publications

Residential space heating is responsible for about 7% of U.S. greenhouse gas emissions. Many analysts believe that electrification with electric heat pumps, energized by clean energy, is a straightforward way of decarbonizing this sector. However, in cold regions such as Michigan, this approach is anticipated to increase heating costs, potentially hindering widespread adoption. In this study, we use actual electricity and gas rate structures in Michigan, combined with simulated hourly energy use data from nearly 3,000 single-family homes from the National Renewable Energy Laboratory (NREL)’s ResStock database. Our objective is to assess whether coupling heat pumps with rooftop solar photovoltaic (PV) systems might ameliorate the increase in bills from heating electrification. Furthermore, we investigate to what extent combining rooftop solar PV with heat pumps might affect the reduction in greenhouse gas emissions using projected short-run marginal emissions factors from the NREL’s Cambium database. We find that, for most Michigan homes, the reduction in bills brought by the combination of heat pumps and solar PV is more than the sum of savings from each strategy implemented independently, demonstrating a synergistic effect on bill reductions. The installation of electric heat pumps will reduce greenhouse gas emissions more than solar PV if the electricity grid is decarbonized by 2035. However, if the grid is only decarbonized to 5% of 2005 emissions by 2050, solar PV would be more effective at reducing emissions. Moreover, we find that heat pumps and solar PV are not always synergistic in terms of greenhouse gas emissions reductions. We employed multivariate regressions and logit models to identify the factors influencing reductions in utility bills and life-time greenhouse gas emissions. Our results suggest that older and larger homes derive greater environmental and economic benefits from the adoption of heat pumps compared to newer and smaller residences.