Summer is officially here, bringing with it record heat and renewed clarity that heat pumps are not just “nice-to-haves,” but essential infrastructure for a livable, equitable, and resilient future.
Today, our Q2 Momentum Report is hot off the press. It’s a must-read, offering a comprehensive look at the progress of building decarbonization, including market trends, neighborhood-scale projects, and the policies that are shaping the transition from methane gas to clean heat across the U.S.
This edition of our quarterly report reminds me just how far the movement you’ve helped build has come in such a short time. We will hold the line, and we will push forward with even more clarity and determination than ever, one day at a time.
Stay cool, stay focused, and let’s keep moving forward together.
Momentum, our quarterly research report, offers a holistic, state-based view of BDC’s four key indicators of building decarbonization momentum: market trends, neighborhood-scale projects, future of gas planning, and future of heat solutions.
Highlights from the Q2 report include:
HVAC heat pumps continue to outsell furnaces, with 2025 sales off to a strong start
BDC’s neighborhood-scale project map grew by 20% this quarter, with new projects including thermal energy networks at a zoo, a non-profit housing initiative, and a City Hall
A new Future of Gas proceeding in Maine brings the total of these critical proceedings to 14 since 2020
A gas-only utility in Oregon will pilot a neighborhood-scale electrification project
D.C. ratepayers could save $244M over the next decade if utilities pursue neighborhood-scale decarbonization instead of business-as-usual gas pipeline replacement
Maryland and Massachusetts enacted major reforms to their gas pipeline replacement programs
Gas Line Extension Allowances (LEAs) are being revoked: New York passes a law to remove its “100-foot” gas subsidy rule, which, when paired with the existing All Electric Building Act, effectively stymies residential gas expansion in New York State; and in Maryland, the PSC announced that Commission staff will propose a new set of gas LEA regulations this winter, indicating it will recommend removing them completely
New York State makes a historic $200 million investment in thermal energy networks
A suite of bills and funding packages encouraging the development of thermal energy networks was passed in Connecticut, Maine, New York, Texas, and Washington.
“We thank the Administration and state leaders for this commitment to neighborhood decarbonization to help our communities access clean cooling and protection from climate pollution. Forty percent of California households cannot afford to electrify their homes, and stronger funding for buildings is essential to ensure our low- and moderate-income households aren’t left behind,” said Beckie Menten, California Director at the Building Decarbonization Coalition.
Statement on the End of the New York State 2025 Legislative Session “We applaud the New York legislature for making significant forward progress on energy affordability this session by repealing the 100-foot rule gas line extension subsidy, saving energy customers more than $200 million each year… We also applaud Governor Hochul and the Legislature for passing the $1 billion Sustainable Future Fund, which includes $200 million for Thermal Energy Networks (TENs) to help deliver clean, affordable heating and cooling to communities across the state. It also invests in equitable building electrification through the EmPower+ program," said Lisa Dix, New York Director at the Building Decarbonization Coalition.
Unlocking Affordable Electrification: the Zero Interest Financing Program from Silicon Valley Clean Energy “This is exactly the kind of innovative program we need for the clean energy transition––it prioritizes and protects communities that need these home upgrades the most but can least afford to do so, while ensuring that their homes are healthy, safe, and climate-resilient,” said Beckie Menten, California Director at the Building Decarbonization Coalition.
We invite you to join us for our monthly California building decarbonization policy discussion! Learn about legislation, regulation, and what’s on the climate policy horizon as our coalition works to advance neighborhood-scale decarbonization, statewide healthy air standards, and energy affordability.
When: July 23, 2025, 1 p.m. ET / 10 a.m. PT BDC’s Senior Culinary Events & Experiences Lead, Chef Rachelle Boucher, will join other all-electric kitchen experts on this Smart Kitchen Summit (SKS) Virtual panel, exploring how induction and other new electric technologies, such as battery backup, will transform consumer and commercial kitchens. Register for the event using the coupon code "BDC" to receive 15% off your registration.
The Cool Down Los Angeles residents rebuilding after the devastating wildfires can actually save money by choosing to build an all-electric home. Per Beckie Menten, BDC’s California Director, “You can save somewhere between $7,000 and $10,000 [in construction and appliance costs], by building an all-electric home as opposed to a dual-fuel home."
Silicon Valley Clean Energy Rolls Out Zero-Interest Financing Pilot Program for Electrification Upgrades Public Power Magazine California community choice aggregator Silicon Valley Clean Energy (SVCE) has launched its Zero Interest Financing Program, which offers customers no-interest loans for up to 100% of the cost of new energy-efficient heat pump systems and water heaters. BDC and other organizations submitted a letter to the California Public Utilities Commission (CPUC) earlier this year, urging the commissioners to move forward with proposals for pilot programs similar to the SVCE program.
BDC’s Lisa Dix and the New York League of Conservation Voters’ Julie Tighe explain how the elimination of New York’s outdated 100-foot gas line extension allowance rule will help New York families upgrade to efficient electric heating and appliances that cost less to operate, improve indoor air quality, and reduce pollution.
POLICY UPDATES
Each month, BDC summarizes key building decarbonization policy-related news from the states in which we work. For more details on policy-related news in each state, visit the state’s policy update web page by clicking the 'Learn More' button beneath the state’s summary.
California
Governor Newsom signed California’s budget bills at the end of June. These bills will backfill $1 billion of CalFIRE’s operational budget using revenue from the state’s Greenhouse Gas Reduction Fund (GGRF). They will also implement provisions from AB 306 (Rivas, Shultz), which imposes a moratorium on all new state and local building codes that impact residential housing, with this moratorium having been folded into budget trailer bills on housing (AB 130/SB 130). In addition, California’s gas utilities must designate priority zones for potential gas line replacements for the California Public Utilities Commission (CPUC) in July as part of the process for implementing SB 1221, a BDC co-sponsored bill that authorizes 30 neighborhood decarbonization pilot projects.
The Colorado Public Utilities Commission (PUC) decided that five communities (Denver, Boulder, Breckenridge, Winter Park, and Golden) that expressed interest in becoming “gas planning pilot communities” can move forward and explore neighborhood-scale decarbonization alternatives. The decision came after BDC joined a diverse group opposed to a joint proposal from the Colorado Energy Office (COE) and Xcel Energy that would have had the PUC only move forward with three gas planning pilot communities rather than the five that were authorized by HB24-1370, the 2024 bill that required the COE to solicit interest in these pilots.
Momentum for the Illinois Thermal Energy Networks and Jobs Act (TENJA) continues to build. TENJA has secured strong support from labor and members of the Illinois Clean Jobs Coalition (ICJC), was moved out of committee by the Illinois Legislature, and was then folded into a larger power sector omnibus bill. Although this omnibus power sector bill wasn’t voted on before the end of the legislative session, interest in TENJA remains strong among lawmakers and the Governor’s Office. BDC is working with its partners to expand support for TENJA over the coming months, with the goal of using the Legislature’s fall veto session to pass the bill.
In June, Maryland achieved a historic victory when its Public Service Commission issued an order that would eliminate gas line extension subsidies, marking a crucial shift toward the state's climate goals. In another sign of growing momentum for building decarbonization in the state, BDC and partners hosted a "Cash In On Clean Energy" contractor convening on June 24 at Prince George's Community College, which brought together HVAC contractors, heat pump manufacturers, and state agencies to prepare for the clean heat transition. In addition, the Maryland Air Quality Control Advisory Council voted to advance the Clean Heat Standard reporting rule, setting the stage for comprehensive emissions tracking by the state’s heating fuel providers.
The New York State Legislature passed S8417/A8888, a bill repealing the state’s 100-foot rule, which provides free gas line connections to any customer who requests gas service within 100 feet of an existing gas line, passing the cost of the connection to all ratepayers. New York is the only state where this 100-foot rule is enshrined in law, and it is now the first state to end a legislatively mandated line extension allowance. The passage of this bill, combined with the budget allocation of $200 million for thermal energy networks (TENs) and investments in the state’s EmPower+ program, marks real progress toward a cleaner, healthier, and more equitable energy future for New York this legislative session.
The Oregon Department of Energy launched its new Heat Pump Purchase program on June 17. The program enables people interested in installing a heat pump to apply for rebates of up to $2,000. Program participants can use these rebates to cover the cost of installing heat pumps in owner-occupied homes, rental homes, and homes under construction. Since its launch, the program has already received approximately 1,000 applications for rebates.
Furthering our commitment to knowledge sharing, we are excited to continue our ‘Report Roundup’ segment, which highlights insightful reports from other organizations in the building decarbonization movement.
Transformative Strategies and Common Spark Consulting, May 2025
This report focuses on the potential for and risks to environmental justice and energy democracy related to the policies for and development of TENs. Through 13 interviews with environmental justice and energy democracy organizations, this report serves as a resource to inform advocates on what potential benefits interest these groups and what information they want more of, such as ownership models and the lifespan of TENs infrastructure.
Greenlighting Clean Heat: Modernizing Permits for Heat Pumps SPUR, May 2025 In California and the Bay Area, inconsistent permitting processes pose a significant barrier to heat pump installations due to issues that include complex requirements across jurisdictions, planning codes, and fee structures. These obstacles have led to permit acquisition rates for heating equipment to typically fall below 20%. This brief outlines the benefits of permit reform and identifies key recommendations to modernize heat pump permitting and accelerate the adoption of clean heating.
Northeast High-Performance HVAC Market Assessment Report Northeast Energy Efficiency Partnerships, May 2025 Estimated air source heat pump (ASHP) sales in the Northeast have outperformed the national market, seeing a 12% increase from 2021 to 2023 in sales, while national ASHP sales declined 8% over the same period. Though this demonstrates that progress is being made toward greater adoption of ASHPs, this report also identifies key opportunities that must be addressed to enable more widespread ASHP adoption.
