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Environment & Energy Report

Pro-Gas States Pass Laws Barring Natural Gas Bans, Limits (1)

May 27, 2020, 10:02 AMUpdated: May 27, 2020, 10:19 PM

States friendly to oil and gas development are trying to stop more cities, towns, and other municipalities from banning natural gas connections in favor of electric hookups, which are seen as more climate-friendly.

The Louisiana House of Representatives on Wednesday unanimously approved a bill that would ban local governments from prohibiting utility connections, including natural gas hookups.

It follows a measure signed in Oklahoma May 19 and similar bills approved in Tennessee and Arizona earlier this year.

“What we are trying to do is send a market signal to the rest of the country to say that Louisiana is open for business when it comes to natural gas,” said Tyler Gray, Louisiana Mid-Continent Oil & Gas Association president and general counsel, during a hearing last week.

The industry has been delivering essential energy for decades, including during the corornavirus pandemic, Karen Harbert, president and CEO of the American Gas Association, said in a statement about the state laws.

“It is short-sighted that any government would consider denying these benefits to their constituents,” she said.

The electric-versus-natural gas debated heated up last year when Berkeley, Calif., became the first city to ban natural gas infrastructure in new buildings, starting in 2020. The hope was to reduce reliance on fossil fuels while meeting climate goals. Since then, similar bills have won approval from municipalities in California, Massachusetts, Oregon, Washington, Ohio, and New York.

‘Serious Jeopardy’

The American Gas Association, which represents energy companies, doesn’t lobby on state issues, though it provides guidance on issues and publishes studies on important topics. It is tracking the issue because it could have a dramatic effect on homebuilders, restaurants, and other businesses, spokesman Jake Rubin said.

“There’s a lot of businesses that would be put in a lot of serious jeopardy if you limit the ability to use natural gas,” Rubin said.

The anti-ban measures are backed by energy and restaurant groups, chambers of commerce, and trade groups.

The Sierra Club, which has been advocating for electric over natural gas and funding studies around the issue, has taken notice.

“We are paying attention to how the industry is mobilizing to preempt communities from choosing a clean future,” said Mark Kresowik, a deputy regional director for the Sierra Club based in Washington, D.C. “Communities and states are recognizing they’ve got to move away from gas and to clean electric appliances.”

The Sierra Club has received funding from Bloomberg Philanthropies, the charitable organization founded by Michael Bloomberg. Bloomberg Environment is operated by entities controlled by Michael Bloomberg.

Climate ‘Virtue’

Other oil and gas states like Alaska, North Dakota, and Texas could follow the path of Oklahoma, Tennessee, and Arizona, said Christopher Mooney, a professor at University of Illinois Chicago, who specializes in state politics and policy.

“It’s legislators finding an opportunity to associate themselves with the values of their constituents,” he said. “For the most part these things are done ceremoniously.”

No Louisiana municipalities have suggested a ban yet. But the trend of bans approved by local governments was worrisome, Sen. Stewart Cathey Jr. (R) said during the May 18 committee hearing on his bill, SB492.

Preempting local bans preserves a choice of energy sources for consumers and businesses, he said.

Cathey’s bill now returns to the Louisiana Senate for lawmakers to consider a House amendment regarding inspections of natural gas utilities.

The Tennessee and Oklahoma laws ban codes that prohibit connections based on type or source of energy. Arizona’s also prohibits fines or penalties that would restrict a utility from operating or serving customers.

The bill signed by Oklahoma Gov. Kevin Stitt (R.) takes effect Nov. 1, a welcome development for the Petroleum Alliance of Oklahoma.

“Abundant, clean-burning natural gas is powering human progress while also enabling the United States to lead the world in greenhouse gas reductions,” President Brook Simmons said in a statement. “Oklahoma is not going to allow that progress to be interrupted by nonsensical local ordinances, which signal climate virtue to the ignorant, but have the opposite real-world effect.”

Health Claims

More than 30 California municipalities now have some sort of ban or restriction favoring electric over natural gas. The California Energy Commission has also said that meeting the state’s goal of 100% clean energy by 2045 will have to include electrification.

On the other coast, Brookline, Mass., banned new natural gas and oil hookups in new and significantly renovated structures beginning in 2021.

Natural gas opponents say it is dangerous, explosive, and can increase emissions inside homes, worsening air quality and creating public health concerns.

The Rocky Mountain Institute, Sierra Club, and other groups released a study in early May that claimed nitrogen dioxide concentrations can be 50% to 400% higher in homes using gas stoves rather than electric. It also said the use of gas stoves could increase asthma risk.

California air regulators are undertaking two studies examining indoor air quality, including emission differences between cooking with natural gas or electric stoves.

(Updates with House vote and adds bill number.)

To contact the reporters on this story: Emily C. Dooley at edooley@bloombergindustry.com; Jennifer Kay in Miami at jkay@bloomberglaw.com

To contact the editors responsible for this story: Gregory Henderson at ghenderson@bloombergindustry.com; Chuck McCutcheon at cmccutcheon@bloombergenvironment.com

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