How to Electrify Your Home Affordably

In Part 3 of our interview with QuitCarbon’s Cooper Marcus, we talk dollars and cents. Can you reduce your upfront costs with inexpensive insulation? How to navigate the world of rebates and tax credits? And how to find a good contractor. 

David Tuft: How do you advise clients with really drafty homes?

Cooper Marcus: Leaky, drafty homes take the heat or the cool and they let it get out. You're taking your money and sending it outside. That's a shame. It makes your home uncomfortable. It also has a real economic impact.

Generally, we're advising clients that they take on a small investment in insulation and air sealing before they proceed with electrifying their home heating and cooling. 

Luckily, that's surprisingly inexpensive. It generally results in a lower overall cost of moving your home off of fossil fuels. Because when you upgrade the insulation and air sealing, and switch to an electric heat pump, that heat pump can be smaller. The equipment cost is less. The install cost is less. Potentially, the related electrical work is less. And your operating costs are less. More of that heat and cool that your heat pump makes will stay inside your home rather than leaking out.

David Tuft: And you're more comfortable at the end of the day. 

Cooper Marcus: That's right. The comfort part is so important. We try to pretend we're all rational economic actors, and we're just doing stuff on dollars and cents, but it feels so good to be in a well-insulated home that's heated with clean and safe electricity. And I think it's important for folks to not pretend that this is all about dollars and cents. Did you think about dollars and cents when you chose a granite countertop in your kitchen? Or when you upgraded to that fancy color of your latest electric vehicle? I mean, there are plenty of things we do because we care. And it's really important that we consider that too when we think about how we heat and cool our homes and provide safety and security for our families.

David Tuft: The equipment costs of heat pump water heaters, are not insubstantial. Yet there are opportunities to save some money. Can you talk about the incentives at different levels of government? Every region is a little bit different.

Cooper Marcus: Yeah, incentives. There is just a veritable fire hose of money being pointed toward homeowners encouraging them to make these changes. In many circumstances, what appears like a an expensive upgrade at first glance, is in fact, really cheap - and in some cases you get paid. 

When you total up all the incentives, plus the utility bill savings, and you realize that you're getting paid to switch off of fossil fuels, it’s amazing. 

Now, it's also the worst of times because they are so complicated and there are so many incentives. They’re changing so frequently, it’s impossible for contractors to keep up. We need them out there turning wrenches and switching gas to electric. We don't need them trying to keep track of all of the latest incentive shenanigans. That's our job. We track them carefully. We're constantly updating them. We have over 300 that we're tracking across California. 

I saw a study that suggested a typical home in the San Francisco Bay Area going from all gas to all-electric might interface with 20 different incentive applications and programs. I do not suggest that any individual homeowner or contractor try to understand that whole thing. We've had plenty of clients come to us say, “I looked into this and my head started exploding. Can you help?” Yes, we can help.

At the federal level, incentives exist mostly in the form of tax credits. At the state level they’re rebates, possibly more tax credits, or discounted financing. Discounted loans are a form of incentive. They exist at the regional level in some places - from the county level, utility level and even down to the individual city level. 

They also differ by your income level, potentially, if you live in a disadvantaged or Energy Justice community. Incentives differ by what contractor you work with, what equipment is being installed in your home, and what equipment it's replacing. Super complicated. But thank goodness, there's a lot of free money out there. You just need a hand to help you take advantage of it.

David Tuft: I’ve been thinking a lot about the difference between auto dealerships and their relationship to the manufacturer, and the very disaggregated world of the HVAC industry. Could you just help us understand what the world of the HVAC contractor looks like?

Cooper Marcus: When it comes to moving your home off of fossil fuels, you end up interacting with a few different contactor types. Typically an electrician, and a plumber for your water heater. An HVAC contractor for heating and cooling. Often, an insulation and air sealing contractor. For the most part, they’re small local businesses. They are your neighbors. They employ your neighbors. It may seem like their services are incredibly expensive, and thus they are very rich, but it's just not true.

Running a small business with vehicles and employees and all of the regulations that exist in California and many other places is not cheap. Contractors are not getting rich off the clean energy transition. They are doing fine. Just like you and I are doing fine. They are in a competitive industry. If you don't like one contractor, it’s really easy to call another one. And they know that, and they can't charge crazy premium prices. 

If you do ever find a contractor charging an outrageous price, what's probably happening is that they don't really want your business. They're busy, or your project is not a good fit, and they're basically saying “If I gotta do this work, I'm gonna make it really worth my while –but I don't really want to do it.”

I hope folks think of contractors as our allies in this clean energy transition rather than our adversaries. I think there generally can be a mistrusting relationship between homeowners and contractors. We hear that a lot, and it’s part of why we exist. We are not a contractor. We exist to help bridge whatever mistrust might be happening there by providing expertise and guidance.

If we're going to move forward on to the bright, shiny all-electric future, we're gonna have a lot of contractors doing a lot of work for a lot of homeowners. So let's be with them.

[Lightly edited for length and clarity]

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