The Potential for Alternative Fuels in Building Decarbonization

ACEEE’s study analyzed costs and emissions for decarbonizing buildings through electrification and alternative fuels for combustion, like biomethane from landfills or livestock manure or synthetic gases made from hydrogen and other chemical compounds.

The study looked at “hard-to-decarbonize” building energy uses—which include backup home heating in cold climates, central water heating in large multifamily buildings, and heating commercial buildings in cold climates—and concluded that the 8% of building energy usage for these needs can be most cost-effectively decarbonized through efficient electric heating. For the remaining 92% of building fossil fuel usage, previous ACEEE research has shown that electric heat pumps are the most cost-effective decarbonization method.

The analysis found that shifting to alternative fuels like biomethane—which the gas industry sometimes calls “renewable natural gas”—would cost about six times more than using efficient electric heat pumps in hard-to-decarbonize buildings. Additionally, the fuels are likely to be available in limited quantities: under the most optimistic supply projections, by 2040 alternative fuels could replace only 12% of total fossil fuel use across all energy sectors (e.g., industry, transportation, electricity generation, and buildings).