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Phasing out new fossil fuel heating equipment with zero-emission heating equipment standards

February 19, 2025

Nearly one-third of Vermont’s annual greenhouse gas (GHG) emissions come from the thermal sector (also referred to as the residential, commercial, and industrial fuel use sector). This primarily includes emissions produced via combustion of fossil fuels for heat and hot water in homes and businesses. Reducing reliance on fossil fuels for heating is critical to achieving Vermont’s climate and energy goals, as well as reducing household energy costs.

Each year, thousands of Vermonters replace their home heating equipment. Given that space and water heating equipment can last anywhere from 10-30 years, installing new fossil fuel equipment means locking in decades of pollution and high costs for consumers. For Vermont to reduce its emissions in line with the requirements of the Global Warming Solutions Act (GWSA), the sale of new fossil fuel space and water heating equipment likely needs to be phased out within the next decade.

To help ensure that newly installed heating equipment does not continue to contribute to climate change for decades to come, states across the U.S. are exploring zero-emission heating equipment standards (ZEHES). EAN’s latest research shows that ZEHES have the potential to substantially reduce climate pollution, improve air quality, and lower energy costs.

What are zero-emission heating equipment standards?

ZEHES are regulatory standards that require that new space and water heating equipment sold and installed after a certain date produce zero emissions. “Zero-emission” equipment is generally defined as equipment that does not produce direct, on-site emissions. 

ZEHES apply to sales and installations of new equipment, meaning that the regulations do not require homeowners to remove existing, functioning fossil fuel equipment and do not prohibit the use of existing fossil fuel equipment for providing back-up or supplemental heat. Rather, ZEHES can help to ensure that when older fossil fuel equipment needs to be replaced, it is replaced with more efficient, pollution-free equipment.

At least ten states across the U.S. are exploring ZEHES as a strategy to reduce emissions and achieve state-level climate commitments, and California and Maryland are leading the way. In 2022, the California Air Resources Board (CARB) proposed the development of a ZEHES in its State Implementation Plan, and CARB plans to finalize the regulations by 2025 and implement them by 2030. Maryland committed to developing a ZEHES in its 2023 Climate Pollution Reduction Plan, and in June 2024 Maryland Governor Wes Moore signed an executive order directing the Maryland Department of the Environment to begin rulemaking on a ZEHES.

What would zero-emission heating equipment standards mean for Vermont energy and emissions?

EAN’s latest research paper, Assessing zero-emission heating equipment standards for Vermont: Analysis of emissions, energy use, and energy costs, aims to estimate the benefits of implementing ZEHES for the residential sector in Vermont. The study models the emissions, energy use, and energy cost implications of implementing a ZEHES in 2030 and in 2035, relative to a baseline scenario.

Implementing ZEHES in 2030 is estimated to result in:

• A 58% reduction in annual GHG emissions associated with residential space and water heating by 2050, relative to 2021 levels.
• More than 8.4 million metric tons of cumulative avoided GHG emissions between 2021-2049.
• About 50% fewer annual NOx, SO2, and PM2.5 emissions in 2049 compared to the baseline scenario.
• More than $1.1 billion in cumulative avoided statewide energy costs plus approximately $1.74 billion in avoided societal costs and damages, relative to the baseline scenario.

Implementing ZEHES five years later — in 2035 — is estimated to result in:

• A 50% reduction in annual GHG emissions associated with residential space and water heating by 2050, relative to 2021 levels.
• More than 5 million metric tons of cumulative avoided GHG emissions between 2021-2049.
• About 40% fewer annual NOx, SO2, and PM2.5 emissions in 2049 compared to the baseline scenario.
• More than $668 million in cumulative avoided statewide energy costs plus approximately $1 billion in avoided societal costs and damages, relative to the baseline scenario.

Depending on the year of implementation, ZEHES for residential equipment could help Vermont to achieve between 38-44% of the thermal sector’s full proportional share of the total economy-wide emissions reduction required by 2050. While additional complementary policies would be needed alongside ZEHES, this would be a significant step forward in Vermont’s effort to curb climate pollution and reduce Vermonters’ dependence on high-cost fossil fuels.

Read the full research paper to learn more. Also, check out this policy brief for a more in-depth discussion of what ZEHES are and how they are being advanced in other states.