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DECARBONIZING SPACE HEATING WITH HEAT PUMPS

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DECARBONIZING SPACE HEATING WITH HEAT PUMPS ( decarbonizing-space-heating-with-heat-pumps )

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DECARBONIZING SPACE HEATING WITH AIR SOURCE HEAT PUMPS The efficiency of the air conditioner is set to seasonal energy efficiency ratio (SEER) 16, which is our estimate of the SEER of a new air conditioner sold in the 2020s. The pricing of components is based on cost estimates reported by EPRI (and scaled based on the sizing of the equipment, as described above) and are shown in tables 3 and 4. From the same source, yearly maintenance costs are assumed to be 2 percent of capital expenditure cost. Table 3: Equipment cost estimates Gas furnace and central air conditioner ASHP and electric backup ASHP Table 4: Sizing of equipment ASHP and electric backup ASHP $1,961 $1,564 $2,354 $1,564 $2,486 $2,142 San Diego, CA Atlanta, GA Fargo, ND San Diego, CA Atlanta, GA Fargo, ND Gas furnace and central air conditioner 12,024 Btu gas furnace and 2.4 kW air conditioner 25,384 Btu gas furnace and 4 kW air conditioner 42,218 Btu furnace 2.4 kW 4 kW 5.3 kW + 2.1 kW We estimated the marginal costs of electricity and natural gas in each of the three locations using 10 years of annual average state-level data, from 2007 to 2016, as reported by the EIA. We considered a 19 percent share of fixed costs for natural gas69 and a 10 percent fixed cost for electricity.70 The highest marginal cost for electricity is in California, with 0.1398 USD/kWh, followed by Georgia with 0.0968 USD/kWh and North Dakota with 0.0775 USD/kWh. The highest marginal cost for natural gas is in Georgia, with 12.75371 USD/1,000 cubic feet, followed by California with 8.69972 USD/1,000 cubic feet and North Dakota with 6.73873 USD/1,000 cubic feet. The NPV cost for the consumers is calculated over a period of 15 years, considering operation and maintenance costs of the unit, the cost of carbon dioxide emissions,74 and the natural gas and electricity costs. We assume a private discount rate of 10 percent. The emissions rate for natural gas is 117 lb. of carbon dioxide per million Btu. For the electricity grid, in the Base Scenario, we assumed 0.894933 lb. of carbon dioxide per kWh (which 38 | CENTER ON GLOBAL ENERGY POLICY | COLUMBIA SIPA

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DECARBONIZING SPACE HEATING WITH HEAT PUMPS

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