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Sierra Club files motion to halt rebates on natural gas water heaters

SDG&E administering statewide rebates in energy efficiency program

SAN DIEGO — The Sierra Club has filed a motion to stop San Diego Gas and Electric from offering rebates on natural gas water heaters.

Ratepayer funds are used to pay for the rebates statewide in an energy efficiency program administered by SDG&E and subcontracted out.

In the January filing with the California Public Utilities Commission (CPUC) the environmental group said the rebates should only go to electric water heaters to encourage homeowners to eliminate natural gas appliances.

“That’s the only way we're going to address the climate crisis and achieve our climate goals is by transitioning away from our gas appliances to electric alternatives,” said Matt Vespa, a senior attorney with Earthjustice, which is representing the Sierra Club.

Electrification of homes and buildings, including replacing natural gas water heaters with electric ones, will help California reach is zero net energy goals by 2045.

Homeowners get a rebate when installing an electric heat pump water heater, but the state continues to offer rebates on energy efficient natural gas water heaters, as well.

“The vast majority of the rebates are going toward gas to gas replacements,” said Vespa. “If you're replacing gas with gas, these have a 10-to-15-year life.  So, your reliance on fossil fuels has now extended another decade or more.”

Over the next three years, the $47.8 million rebate program (the Energy Efficient Statewide Plug-Load and Appliance Program) will be administered by SDG&E across California, which is another problem, according to Vespa.

“I just don’t think any Sempra utility should be administering anything statewide that has to do with gas versus electric, given how hostile they've been to electrification,” said Vespa.

Sempra owns both SDG&E in San Diego and SoCal Gas to the north.

“Unfortunately, when your parent company is Sempra – which is a very fossil fuel-oriented company – they want to keep Californians reliant on gas.  And so that means they continue to invest in gas infrastructure, the pipes and things like that, rather than just move toward all electric homes, which are much healthier and don't pollute,” said Vespa.

The motion the Sierra Club filed with the CPUC aims to ban rebates for natural gas water heaters.  The group also filed a protest to an “advice letter” recently submitted by SDG&E naming CLEAResult Consulting, Inc. as the rebate program’s subcontractor.

SDG&E replied to the Sierra Club protest, arguing that modern, natural-gas appliances and heaters are more efficient than old ones, and therefore deserve rebates.

“[T]he program will offer rebates that support energy efficient versions of these gas appliances, so the customer is incentivized to purchase more efficient models. These more efficient models contribute to the reduction of [Green House Gases] when compared to standard models,” SDG&E’s reply to the protest said.

The utility’s reply to the Sierra Club motion said rebates on gas water heaters also help low-income customers.

“Disallowing rebates for natural gas appliances, as this Motion seeks, would go against the Commission's equity efforts, as many customers that have natural gas service are likely unable to afford electrification measures."

Vespa, the attorney representing the Sierra Club, expects a CPUC staff decision on the protest in a couple weeks.  A CPUC decision on the Sierra Club motion could take months, according to the attorney.

If you are looking for assistance in replacing your natural gas water heater with an electric version, the website switchison.org can help homeowners find rebates and installation contractors.

WATCH RELATED: Amped Up: Several San Diego elected leaders have accepted campaign donations from Sempra (Feb. 2022).

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