A PIVOTAL MOMENT IN WASHINGTON STATE

Washington state is at a pivotal moment in its building decarbonization journey. With an influx of federal funding and several keystone policies in place, the state is on the path to achieving the goals set out for building decarbonization in the Washington 2021 State Energy Strategy.

However, the state is not currently set up to achieve the 2050 greenhouse gas emissions targets at the required speed of change. The scale and pace of building decarbonization required to meet economy-wide emissions targets far exceed the capacity of the current building sector ecosystem and funding.

Washington needs a roadmap substantiated by analysis of what the building sector ecosystem requires to deliver decarbonization at this scale and pace, including targeted policy and investment recommendations for the building infrastructure needed to dramatically ramp up electrification by 2030.

Working with stakeholders and subject matter experts to bridge this gap, SCALE 2030 will help policy makers and advocates prioritize and weight the relative value of various decarbonization options. Using the recently released Clean Energy Transition Institute’s (CETI) Net-Zero Northwest analysis, SCALE 2030 will provide critical analysis to support policy and investment decisions.

The goal is to significantly alter the building decarbonization trajectory in Washington from incremental change based on legacy incentive-based strategies to large-scale systemic change, investments, and cost reductions that will deliver rapid and measurable increases in the share of zero-emission equipment, thereby reducing emissions and keeping Washington on track to transition the full building stock by 2050.

RAPID MARKET TRANSFORMATION FOR 21^st CENTURY MOBILIZATION

Meeting Washington’s 2050 greenhouse gas emissions limits requires eliminating nearly all building stock emissions in less than three decades. SCALE 2030 is designed to shift the state from a 20^th century era approach focused on incremental energy efficiency improvements to a 21^st century rapid market transformation strategy aimed at decarbonizing the entire building stock in Washington in just over 25 years.

Installing zero-emission appliances in most building end uses when existing fossil fuel appliances reach the end of their useful service is the most strategic and lowest cost path to accomplish this radical change. To ensure that space and water heating equipment is fully zero emissions across the building stock by 2050, Washington’s building sector must steadily ramp up to a 100% replacement rate by 2030. This requires systemic change and large-scale mobilization that current policies, programs, or incentives will not deliver.

Current federal and state funding, while impressive, will likely address less than 10% of residential and commercial buildings based on Clean Energy Transition Institute analysis conducted for the Washington 2021 State Energy Strategy and Operation 2030. SCALE 2030 will identify a roadmap for decarbonizing the remaining buildings—the missing 90%—that current policies, programs, and incentives are not structured to deliver.

Based on our preliminary analysis, we see the following systemic barriers preventing the building ecosystem from decarbonizing buildings at scale by 2030:

• Complexity and friction across the building sector ecosystem
• High incremental first costs
• Lack of alignment across policies, programs, and market activities
• Focus on incremental change and approaches with high administrative burden
• High economic insecurity and inadequate funding to ensure a stable workforce and equitable distribution of benefits

DRIVING SYSTEMIC CHANGE

SCALE 2030 aims to drive systemic change to mobilize large-scale, equitable building decarbonization in Washington state. Bridging the gap in policy and investments needed to scale building decarbonization by 2030 will ensure the building sector ecosystem can reduce building emissions to zero by 2050.

SCALE 2030 is guided by five key organizing principles: (1) Simplicity; (2) Cost Reductions; (3) Alignment; (4) Leverage; and (5) Equity and involves five initiatives:

1. Design a performance-based Building Decarbonization Ecosystem capable of decarbonizing buildings at scale by 2030 and meeting Washington’s statutory 2050 emissions limits.
2. Assemble a Building Decarbonization Roadmap with recommendations and a timeline for policies; simplified program designs; strategic investments; and market development required to develop a high performing building decarbonization ecosystem.
3. Align Power Planning with Decarbonization Policy to ensure that the 2026 Northwest Power Plan includes appropriate levels of efficiency and distributed energy resources to meet load growth associated with near 100% electrification of building end uses.
4. Develop a Blueprint for Deep Cost Reductions to identify the most strategic, lowest cost solution sets, deployment strategies, and building infrastructure investments to deliver a 25-50% reduction in building decarbonization costs and reduce burden on low- and moderate-income households.
5. Develop a Framework for Systemic Funding and Incentives to recommend the highest priority suite of performance-driven funding approaches and incentives to address the funding gap.

TWO-YEAR MOBILIZATION PLAN

The SCALE 2030 project spans the timeframe from 2023 to 2025 to ensure that Washington can put all the pieces in place to complete rapid market transformation in the building sector market by 2030. The two-year mobilization plan is designed to inform key policy, planning, and budgeting efforts, including but not limited to the 2024 Washington State Energy Code development cycle, the 2024 and 2025 Washington state legislative sessions, and the development of the 2026 Northwest Power Plan.