We continue to track litigation and legislations involving proposed or enacted bans or limitations on natural gas appliances. As anticipated, this area continues to evolve, and we are finding increased litigation regarding the enforceability of such laws, as well as the safety of natural gas appliances. We previously discussed the efforts to electrify America’s natural gas infrastructure in various markets here. This article provides updates and explains several nuances to these electrification efforts.
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New York
On May 2, 2023, more than a month past the April 1st due date, New York Governor Kathy Hochul and the legislature approved the 2023–2024 State Budget. Its approval makes New York the first state in the nation to prohibit natural gas hookups and other fossil fuels in most new homes and other new construction.
Under the law—set forth in Part QQ of the 2023-2024 Budget, Bill Number S04006C—all-electric heating and cooking will be required in new buildings shorter than seven stories by 2026, and by 2029, in buildings seven stories and taller. There are exemptions for commercial and industrial buildings such as manufacturing facilities, restaurants, hospitals, and carwashes. As of the date of this post, we are unaware of a formal challenge to the New York ban, but such a challenge is likely.
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Berkeley, California
On April 17, 2023, the Ninth Circuit Court of Appeals concluded that the Energy Policy and Conservation Act (“EPCA”) preempted the City of Berkeley’s Ordinance banning natural gas infrastructure in newly constructed buildings. Enacted in August 2019, the Ordinance is one of the first such bans in California. It amends the Berkeley Municipal Code to prohibit the installation of “fuel gas piping, other than service pipe” in newly constructed buildings, providing an exception for when the use of natural gas “serves the public interest.” The California Restaurant Association immediately challenged the Ordinance, arguing it was preempted by both state and federal law. In July 2021, the District Court for the Northern District of California rejected the Association’s preemption arguments and sided with the City of Berkeley, dismissing the case and allowing the Ordinance to stand.
The Ninth Circuit’s April decision, California Restaurant Association v. City of Berkeley, No. 21-16728, 2023 WL 2962921 (Apr. 17, 2023), reached the opposite conclusion, reinstating the Association’s claims and allowing its challenge to the Ordinance to move forward. Along the way, the Ninth Circuit adopted a broad interpretation of the EPCA that may serve as a cautionary tale for other municipalities looking to pass similar bans. Indeed, according to the Ninth Circuit, the EPCA preempts “regulations that relate to ‘the quantity of [natural gas] directly consumed by’ certain consumer appliances”—refrigerators, dishwashers, and kitchen ovens—“at the places where those products are used.” Therefore, the EPCA preempts “regulations that address the products themselves and the onsite infrastructure for their use of natural gas” and “would no doubt preempt an ordinance that directly prohibits the use of covered natural gas appliances in new buildings.”
The City of Berkeley has since petitioned the Ninth Circuit to rehear the case en banc, arguing that the Ninth Circuit’s April decision was “seriously wrong.” It remains to be seen whether the Ninth Circuit will take up the City’s invitation.
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Washington
A coalition of homebuilders, contractors, trade groups, and utilities is challenging Washington’s recent amendments to the Washington State Energy Code. The coalition alleges that the amendments ban the use and installation of natural gas appliances and that such a ban is preempted by the EPCA. The lawsuit was filed on May 22, 2023—just over a month after the Ninth Circuit issued its decision in California Restaurant Association v. City of Berkeley. The District Court for the Eastern District of Washington’s application of California Restaurant Association v. City of Berkeley—assuming the Ninth Circuit does not grant Berkeley’s petition for a rehearing—will be another guidepost for future litigation over similar bans.
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Eugene, Oregon
In February 2023, the city council in Eugene, Oregon passed an ordinance banning natural gas appliances in new residential buildings shorter than four stories. The ordinance was drafted to apply to buildings with permit applications submitted on or after June 30, 2023. The ordinance does not prohibit fossil fuel infrastructure in new mixed occupancy buildings that include a commercial use.
However, the ordinance sparked controversy among residents, which led to Eugene Residents for Energy Choice submitting more than 12,000 signatures in March, triggering a citywide vote. The ordinance has been placed on hold until the next regular election on November 7, 2023.
The date the ordinance takes effect depends on whether the voters accept it. In other words, that date will be determined after the November 2023 election. However, if voters reject the ordinance, it will be discarded altogether.
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Federal
On March 17, 2023, House Republicans introduced legislation—H.R. 1640 and H.R. 1615—aimed at preventing the federal government from regulating the use of gas stoves in households.
H.R. 1640—also known as the “Save Our Gas Stoves Act”—seeks to “prohibit the Secretary of Energy from finalizing, implementing, or enforcing the proposed rule titled ‘Energy Conservation Program: Energy Conservation Standards for Consumer Conventional Cooking Products.’” The Department of Energy’s proposed rule would reduce energy usage of gas and electric stoves and ranges by about 30% according to some estimates, reducing nationwide energy costs by $1.7 billion, and reducing emissions of air pollutants linked to climate change. The “Save Our Gas Stoves Act” would prevent the Department of Energy from setting such energy efficiency and conservation standards for consumer conventional cooking products, including gas stoves.
Similarly, the “Gas Stove Protection and Freedom Act”—H.R. 1615—would “prohibit[] the Consumer Product Safety Commission from using federal funds to (1) regulate gas stoves as a banned hazardous product, [and] (2) issue or enforce a product safety standard that prohibits the use or sale of gas stoves or substantially increases their price.”
After a weeklong delay of floor action by Republicans, the House passed both bills. On June 13, 2023, the House passed the “Gas Stove Protection and Freedom Act” with a 248-180 vote, seeing more than 25 Democrats vote in favor of the bill. Similarly, the “Save Our Gas Stoves Act” was passed on June 14, 2023, with a vote of 249-181, seeing more than 30 Democrats vote in favor of the bill.
As legislation and litigation continues to develop surrounding the use of natural gas appliances, we will continue to provide updates and analysis to help natural gas appliance manufacturers make informed decisions about next steps in an ever-changing regulatory landscape.
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