Cross-State Gap Analysis #1

Michigan documented that 20% of low-income heat pump participants saw bill increases — and no state adopted safeguards

Five states are promoting heat pump adoption for LMI households. None has enacted binding consumer protections against the documented risk that electrification increases energy burden. The populations least able to absorb financial risk bear the most technology risk.

20%
Of income-qualified multifamily participants saw bill increases averaging 24%
Consumers Energy cold-climate heat pump pilot: 663 installations, 2020-2021. Causes included continued baseboard heating use, non-optimal HP operation, added cooling load, and behavioral takeback. The evaluation warned: "Need for additional analysis and efforts to avoid negative outcomes for these customers least able to afford them."
MPSC EWR Collaborative, "Impact Evaluation Highlights: 2020-2021 Cold-Climate Heat Pump Pilots," November 21, 2023, Slides 9-10, 13-14.
Consumer protection matrix: what exists vs. what doesn't
Protection MA VT PA MI WI
Hold-harmless / bill guarantee ✗No provision. Seasonal HP rates partially mitigate. ✗Act 142 recommends tax credit mechanism — not enacted. ✗CAP caps bills at % of income but doesn't address fuel switching. ✗Pilot documented 20% bill increases. No response. ✗PSC report acknowledges HPs "increase heating costs."
Performance guarantee ✗"Sponsors do not endorse or warrant performance." ✗No provision beyond general consumer rules. ✗LIURP rulemaking covers weatherization only. ✗Standards are utility-specific, pilot-specific. ◐Verification inspections, no guaranteed outcomes.
Backup heating requirement ◐Partial Home: backup at 30°F (gas) / 5°F (propane). Whole Home: fossil system must be removed. ✗EVT recommends but doesn't require supplemental heat. ✗No electrification program exists to regulate. ✗Baseboard heaters "not disabled" in DTE pilot — customers didn't know to stop using them. ✗PSC recommends dual-fuel as "stepping stone" — not mandated.
Contractor HP standards (LMI-specific) ◐HPIN/HPLN network: EPA cert, Manual J, sizing bonus. Not LMI-specific. ◐EEN: BPI cert, 400+ members. Not LMI-specific. ✗LIURP Final Rulemaking (Mar 2025): weatherization only. ✗No MPSC-mandated standard. LI Workgroup survey underway. ◐ENERGY STAR + IRA Registered Contractor for HEAR.
Cascading failure protocol ◐Turnkey Solutions in 21 Designated Equity Communities. No statewide mandate. ✗EAG flagged: "no requirements that weatherization occur before HPs." Case 25-1094-INV investigating. ✗Not addressed. ✗Not addressed. ✗Not addressed.
Michigan — the evidence
DTE single-family HP pilot: only 7% savings vs. expectations
Baseboard heaters were "not disabled at electric panel for most homes" and customers were "not clear that continued usage would impact energy savings." The breakeven analysis concluded gas customers "would likely not see lifetime economic savings from heating electrification."
DTE IQ Residential Pilot, Guidehouse, EWR Collaborative, March 15, 2022, Slides 2, 4, 17. Breakeven Analysis, Guidehouse, 2022.
Massachusetts — the disclaimer
Mass Save explicitly disclaims performance warranties
"Sponsors do not endorse or warrant the performance of installed or serviced equipment and do not make any representations or warranties regarding the services provided by these contractors." LI customers bear all technology risk.
Mass Save Air Source Heat Pump Rebate Form, 2024, masssave.com.
Vermont — the acknowledgment
PUC and EAG both acknowledge electrification may increase LI burden
Act 142: "not all customers will save money through electrification." EAG: the CHS "is likely to increase fuel costs, and therefore increase the energy burdens of low and moderate income Vermonters, at least in the short term."
Act 142 Final Report, VT PUC, Dec 2025, p. 2 fn. 2. CHS EAG Final Report, Jan 7, 2025, Exec Summary p. 1.
Wisconsin — the finding buried in a report
PSC's own market assessment found HPs "will typically increase heating costs" for gas homes
The 2023 ASHP Market Report identified ~300,000 propane/resistance homes that could save, but documented that gas-heated homes face a cost penalty. The Quad IV Order restricts Focus on Energy from claiming fuel-switching savings through 2026.
PSC ASHP Market Report, July 14, 2023, ERF docid 472912. Quad IV Order, Nov 2022, Docket 5-FE-104.
The five-state evidence reveals a regulatory pattern: states acknowledge the risk of bill increases from electrification in study reports, pilot evaluations, and advisory group findings — then proceed with program expansion without adopting binding consumer protections. Michigan has the most detailed evidence of consumer harm. Massachusetts has the most explicit warranty disclaimer. Vermont has the most candid official acknowledgment. No state has acted on any of it.
The consumer protection void exists because no regulatory framework anticipated fuel-switching as a program outcome. Weatherization consumer protections (contractor standards, work specifications, quality control) exist in PA and are developing elsewhere. Electrification consumer protections don't exist because the programs are new — but the risks are already documented.
Sources: MI 20%/24% bill increase — MPSC EWR Collaborative, "Impact Evaluation Highlights: 2020-2021 CCHP Pilots," Nov 21, 2023, Slides 9-10, 13-14. MI DTE 7% savings — Guidehouse, "DTE IQ Residential and Multifamily CCHP Pilot," EWR Collaborative, Mar 15, 2022, Slides 2, 4, 17. MI breakeven — Guidehouse, "Residential HP Breakeven Analysis," 2022. MA disclaimer — Mass Save ASHP Rebate Form 2024. MA Whole/Partial Home backup — Mass Save program terms, 2024-2025. MA Turnkey Solutions — DPU 24-140 through 24-149, Order, Feb 28, 2025. VT "not all will save" — Act 142 Final Report, VT PUC, Dec 1, 2025, p. 2, fn. 2. VT EAG "increase fuel costs" — CHS EAG Final Report, Jan 7, 2025, Exec Summary p. 1. PA LIURP — Final Rulemaking Order, Docket L-2016-2557886, Mar 13, 2025. WI ASHP — PSC Market Report, Jul 14, 2023, ERF docid 472912. WI Quad IV — Docket 5-FE-104, Nov 2022.