Cost-Effective Technologies and Strategies to Improve Energy Efficiency and Reduce Emissions of Direct Heating Equipment in California with Health Benefits
Cost-Effective Technologies and Strategies to Improve Energy Efficiency and Reduce Emissions of Direct Heating Equipment in California with Health Benefits
Lawrence Berkeley National Laboratory
Recipient
Berkeley, CA
Recipient Location
9th
Senate District
14th
Assembly District
$1,716,232
Amount Spent
Completed
Project Status
Project Result
This project concluded in 2025. The project assessed California’s Direct Heating Equipment (DHE) market, evaluated low-efficiency and high-efficiency units in households and in a combustion laboratory, and explored options to increase the adoption of high-efficiency DHE in the state. The high-efficiency DHE models installed at participating sites showed they could reduce natural gas use for space heating, specifically on these sites, by 20% to 40% on average during a typical heating season.
The project estimates that between 2026 and 2040, around 500,000 DHE units in the state will reach retirement age, with 83% of these units located in low-income households. If households continued to operate these units, they would collectively incur $2.3 billion in DHE gas bills through 2070. Alternatively, if they opted to replace them, households would achieve a 5% reduction in gas usage with a baseline model and a 15% reduction with a high-efficiency model. These savings translate into $87 million and $215 million total reductions in household gas bills, with 90% of savings estimated to benefit households in Southern California, the San Francisco Bay Area, and the Central Coast. Replacing current units with similar models would require an investment of $1.3 billion, while replacing them with a high-efficiency model would require an additional $418 million.
Financial incentives for purchasing high-efficiency DHE would lower upfront costs, thereby motivating households to upgrade from existing units to high-efficiency models. If the incentives entirely covered the additional purchase price of a high-efficiency DHE compared to a baseline model, and the decision to upgrade were limited to households where the investment would pay off within 30 years, households in California could save around $200 million on their natural gas bills. The savings could increase to nearly $900 million under favorable conditions regarding future upfront costs and natural gas rates.
The Issue
Installation of natural gas, ductless, inefficient direct heating equipment (DHE) has adverse energy, economic, environmental, and health implications. Inefficient heaters cause increased energy costs and emissions. An estimated 15% of California households rely on DHE for heating needs. The installation, performance, and operational characteristics of DHE, as well as homeowners willingness to upgrade their currently installed DHE, are poorly understood. This is a barrier for the design of targeted programs that could avoid the adverse impacts of this equipment.
Project Innovation
This project will develop cost-effective strategies to increase adoption of high-efficiency direct heating equipment (DHE) in California, which will reduce natural gas use, resulting in energy, economic, and emissions benefits. Newer models of DHE include advanced technologies such as: electronic ignition, improved burners, improved heat exchanger designs, induced draft designs, multi-stage or modulating controls, improved air distribution, and improved controls. The team will develop strategies based on an assessment of the DHE market in California, laboratory and field evaluations, and program modeling and analysis.
Project Goals
Project Benefits
The project develops cost-effective strategies to increase the adoption of higher-efficiency DHE in the state and contribute to reducing natural gas use and emissions to meet the state's goals.
Affordability
Improvements in the energy efficiency of DHE will result in lower energy costs. This will benefit households in low-income and disadvantaged communities where a large fraction of DHE is installed.
Safety
There is potential to reduce safety risks posed by old and inefficient DHE models currently operating in California.
Key Project Members
Helcio Blum
Sarah Price
Subrecipients
TRC Engineers, Inc.
Schlesinger Group
Match Partners
Senseware Inc.
