An Oregon City Banned Natural Gas. The Gas Company Fought Back

Source: By Patrick Sisson, Bloomberg • Posted: Wednesday, April 26, 2023

Eugene’s ordinance restricting gas hookups in new construction was set to be the state’s first — until a local utility and its allies launched a $1 million counterattack.

Local restrictions on gas hookups in new housing have drawn a counterattack funded by the natural gas industry. 

Local restrictions on gas hookups in new housing have drawn a counterattack funded by the natural gas industry.  Photographer: Géza Bálint Ujvárosi/EyeEm via Getty Images

In February, when the city council in Eugene, Oregon, passed an ordinance banning natural gas hookups in new low-rise construction, local environmental groups cheered. This was a chance for the college town to take a step toward reducing carbon emissions, help support the state’s climate action plan and make history as the first city in Oregon to pass such a law.

Mayor Lucy Vinis pushed for legislators to support the ordinance, which prevailed in a 5-3 vote. “There will be some joy in the community tonight,” she said.

Now Eugene’s ban is making news for another reason, after allies of Portland-based utility company NW Natural launched a rapid-response campaign to force a public vote undoing the legislation. The firm spent roughly $1 million to bankroll Eugene for Energy Choice, a group opposing the ban that started collecting signatures for a referendum just weeks after the council’s action. Eugene voters are likely to decide on the ordinance’s fate via a ballot measure in November.

The battle in the small Pacific Northwest city of roughly 175,000 people is being closely watched, as it could foreshadow tactics the fossil fuel industry will use to defeat municipal efforts to electrify buildings, cut emissions and improve indoor air quality.

The gas company’s effort to push through a referendum is the first such example of this approach, according to Charlie Spatz, a researcher at the Energy and Policy Institute focused on fossil fuel companies. It comes as a recent decision from the Ninth Circuit Court of Appeals, which covers western states including Oregon, ruled that the pioneering gas ban in Berkeley, California, enacted in 2019, was unconstitutional due to preempting existing federal legislation. Opponents of the Eugene ordinance have said they’re currently retooling their strategy with the Berkeley decision in mind.

A successful vote “would embolden other companies to put forward their own ballot initiatives,” said Spatz. “It’s the first of its kind, and could serve as a model for the industry.”

The approach echoes Proposition 22, the California ballot measurethat ride-hailing companies Uber Technologies Inc. and Lyft Inc., along with other gig-economy allies, funded to pass labor laws valuable to their business model.

In a reflection of the stakes involved, the Eugene ordinance is also drawing high-profile defenders. On April 13, YES for Eugene, a coalition of local and national groups and climate leaders like Bill McKibben, announced their intention to defeat the referendum. Among those supporters: actress and environmental activist Jane Fonda.

“I am looking forward to working with the people of Eugene to oppose this anti-democratic attack on local leadership and to make sure every voter knows they have the opportunity to uphold this policy transitioning new homes to clean energy,” Fonda said in a statement.

EUGENE, OR April 14: A cyclist passes by University of Oregon'
Eugene is known as the home of the University of Oregon. Photo by Wesley Lapointe for The Washington Post via Getty Images

Eugene for Energy Choice, registered in Portland by the same law firm that manages NW Natural’s political action committee, was funded by the utility to the tune of $954,080, or roughly 99% of its support.

“Eugene voters should have a say on the City Council’s decision to ban gas in new homes,” NW Natural spokesperson Dave Santen told Bloomberg CityLab, “which is why NW Natural supported a signature gathering campaign to get this decision on the ballot. This effort was not paid for by NW Natural customers.”

Group spokesperson Anne Marie Levis said in a written response to questions that the group informally organized last year, and gathered 4,000 community member signatures on a letter sent to the city council in December opposing the ban. The organization’s final tally of 12,000 signatures, as well as the support of groups like the local chamber of commerce, are an “authentic representation of the interest of the Eugene voters,” Levis said.