Massachusetts sets 2025, 2030 greenhouse gas limits for state, sectors

Massachusetts plans to focus on decarbonizing its electric grid and electrifying its transportation and building sectors as it seeks to meet new greenhouse gas emissions reduction goals over the next decade.

The state's Executive Office of Energy and Environmental Affairs, or EEA, set the 2025 and 2030 emissions targets at 33% and 50% below 1990 levels, respectively. The office additionally set sublimits for six sectors, outlining strategies to achieve reductions in the Clean Energy and Climate Plan for 2025 and 2030, released June 30.

While the climate plan leaves ample investment opportunities for Massachusetts electric utilities, it creates substantial uncertainty for the state's gas utilities.

The report "is a comprehensive and balanced plan that will serve as a guide for Massachusetts as we work to achieve ambitious emissions goals and reach net zero in 2050 in an equitable and affordable manner," Gov. Charlie Baker said in a June 30 news release.

The report stems from the state's 2021 climate policy road map legislation, which required the EEA to set emissions reduction goals and pathways to meet them. The report builds on the EEA's December 2020 interim report, which set the 2030 target at a 45% reduction from 1990 levels.

Electric grid evolution

The plan's overarching strategies largely dovetail with the interim report, but the new study offers more detail on and a clearer view of the administration's priorities in light of additional analysis, policymaking and regulatory developments.

In the electric power sector, which accounted for 20% of the state's 2020 emissions, the EEA continued to see offshore wind development driving grid decarbonization, with support from Canadian hydropower imports and "rapidly growing" solar and storage assets.

In addition to executing renewable energy procurements, the state plans to evolve markets for clean energy attributes, including its renewable portfolio standard. It also intends to work with neighboring states to plan electric power systems and reform the wholesale electricity market.

Additionally, Massachusetts said it would support the development of the solar and offshore wind industries by working to clear grid interconnection bottlenecks, developing regional supply chains and other strategies. Lastly, the state plans to integrate decarbonization goals into distribution system upgrades, including through grid modernization plans overseen by the Massachusetts Department of Public Utilities, or DPU.

Building electrification headlines clean heating

The biggest changes could be in oil and gas building heating, which represented 30% of the state's 2020 emissions, second only to transportation. To achieve greenhouse gas reductions, the EEA examined several clean heat scenarios, ranging from high use of low-carbon fuels to full building electrification.

The EEA ultimately adopted emissions sublimits for heating and cooling in the residential, commercial and industrial building sectors based on a middle-ground scenario. That scenario envisions rapid adoption of electric heat pumps with a focus on hybrid fossil fuel-electric heating systems through the 2020s, a move to whole-home retrofits after 2030 and limited clean fuel use in 2050.

The office acknowledged the challenge of scaling-up heat pump adoption but said the scenario avoids locking in fossil fuel use and the risks associated with using low-carbon fuels, the preferred decarbonization approach for the gas industry.

"While the technologies to use biofuels, clean biogas, and green hydrogen may be available, using those resources to heat our homes and businesses will require developing new supply chains, with significant uncertainties around the availability and costs of the resources," the EEA said.

The EEA highlighted several initiatives now underway. The state's Commission on Clean Heat is exploring ways to limit building emissions, including an emissions cap for heating and uniform energy and emissions benchmarking. The administration is also developing new energy codes that would drive electrification, while the DPU is reviewing the gas distribution system's role in the energy transition (Docket No. 20-80).

Gas distribution system decommissioning

While the DPU proceeding is ongoing, the EEA said "targeted decommissioning of the gas distribution system may be necessary to support a just and equitable transition toward electrified heating."

The EEA said methane leaks from the gas grid are "substantial," but the industry has reduced them significantly through programs to replace leak-prone pipe, backed by state policies to support system enhancements.

The EEA set the largest emissions reduction goals for natural gas distribution and service, targeting an 82% decline by 2025. The industry has already made substantial progress toward that goal through integrity management and leak detection programs. Annual methane emissions from U.S. gas distributions systems fell 73% from 1990 to 2018, according to the American Gas Association.

The report also plotted public transportation and electric vehicle strategies to decarbonize the transport sector. It set a cap on growth in emissions from the hard-to-electrify industrial sector. It also set goals for sequestering carbon through protecting natural resources that can store CO2 emissions.

In addition to the climate benefits, the EEA forecast the plan would produce a net gain of more than 22,000 mostly middle- and high-wage jobs by 2030. It would also save the average household about $400 annually, chiefly due to lower spending on heating oil and natural gas, the office said. The EEA valued the public health benefits from improved air quality at more than $400 million per year.

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