Public Utility Commission Investigates Future of Natural Gas in Oregon
Posted on July 13, 2021 by Mike Goetz
Tags, Energy
On March 10, 2020, Oregon Governor Kate Brown issued Executive Order 20-04, directing state agencies to take actions to reduce and regulate greenhouse gas emissions. While this direction involves several state agencies, the Oregon Department of Environmental Quality (DEQ) and the Public Utility Commission (PUC) have taken leading roles in implementing the Order. The DEQ is enacting a Climate Protection Program which will require emissions reductions from natural gas utilities. This creates a substantial risk for natural gas customers. Renewable natural gas is limited and expensive. Some customers will choose to reduce emissions by switching from gas furnaces to electric heat pumps. Customers who are unable to switch - specifically low-income households - may be left responsible for ballooning costs as the natural gas system is funded by a shrinking customer base.
With these concerns in mind, CUB filed comments at the PUC in October 2020 requesting an investigation into the future of natural gas. Our aim is to get ahead of the risks created by the currently expanding natural gas system and simultaneous greenhouse gas regulations that will levy additional costs. After a request from CUB and several allied organizations, the PUC announced it was opening a natural gas fact finding investigation to examine the future of the natural gas industry during a time of changing regulatory and environmental climates. The PUC is particularly interested in understanding the potential economic impacts on natural gas bills and exploring regulatory options to ease the burden on customers.
CUB applauds the efforts by the PUC and key stakeholders to take a hard look at the natural gas sector and determine a way forward that does not harm utility customers. Although the natural gas sector has seen increasing customer counts in recent years, the future remains unclear. As the effects of climate change become more acute and regulations steepen, many customers may eschew natural gas in favor of electric heat pumps. Communities may seek to limit natural gas in new buildings.
Meanwhile, natural gas utilities continue to make substantial investments to replace aging pipes. Under a future scenario with both increasing investments and decreasing customer counts, the customers that remain on the system would be forced to pay higher and higher bills. These customers are likely to be the most vulnerable among us: low-income households, renters, communities of color, and others who are unable to make expensive electrification upgrades.
The policy and equity issues on the table in this proceeding are many and complex. However, we look forward to engaging in the discussion to find the best path forward for Oregonians.
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07/13/21 | 0 Comments | Public Utility Commission Investigates Future of Natural Gas in Oregon