(SALEM, OR) - - Oregon utility regulators got a taste this month of the tension building over a push to “electrify everything.”
The movement, promoted by climate activists as a key to reducing greenhouse gas emissions, is focused heavily on how buildings are heated and poses an obvious threat to natural gas distribution companies.
In the case at hand, Portland General Electric proposed boosting the rebate on the cost of extending service to all-electric homes to $2,260, compared to about $1,600 for other homes.
The Public Utility Commission agreed, although it was careful to say the decision was based on the economic benefits that the proposal would bring all PGE ratepayers by increasing revenue that supports the utility’s distribution system by a margin that exceeds new costs.
Still, the discussion of what are known as line-extension allowances brought out electrification advocates and NW Natural, the region’s dominant gas utility. And it began to frame an electricity vs. gas debate that figures to unfold in earnest in the years ahead.
It’s a debate that climate activists, many of whom would like to see NW Natural’s own line-extension allowance eliminated, are eager to have.
Their basic argument is that decarbonizing electricity is a more viable long-term strategy than cleaning up the gas system.
“We believe this is a really good example of how line-extension policies or construction-allowance policies can be used as a tool to reduce future carbon emissions and lower onsite energy consumption of new buildings,” Brian Stewart, founder of Electrify Now, told the commission at a Dec. 15 meeting.
Oregon League of Conservation Voters, Renew Oregon, Oregon Environmental Council, Sierra Club and other groups joined in supporting PGE’s proposal. And they encouraged the commission to undertake a deeper investigation that looks at the climate implications of line-extension policies, especially in light of Gov. Kate Brown’s executive order to reduce greenhouse gas emissions in Oregon.
Commission Chair Megan Decker noted that the commission is beginning to probe the complex question as it explores implementing Brown’s order.
NW Natural didn’t strictly oppose PGE’s proposal. But the gas utility rejected a PGE framing that the proposal “supports Oregon’s decarbonization policy by providing an incentive to electrify, and therefore, increasingly decarbonize residential load.”
NW Natural called those “unsupported assertions” that would need a full investigation before being accepted by the commission. The company has argued that new gas efficiency measures, renewable natural gas and green hydrogen can make its gas system climate friendly.
The company even objected to a proposal by ratepayer advocate CUB to exclude from the higher allowance homes that will use “resistance heating” — think baseboards — instead of high-efficiency options such as heat pumps.
Resistance heating is cheap to install, but because it’s inefficient, is costly to use and adds to the grid burden, CUB said, and shouldn’t be encouraged.
NW Natural objected to the exclusion on the grounds that it reframes line-extension allowances — utility payments toward the cost of extending service to new buildings — as more than a question of the economic benefits that new customers bring the system.
But the PUC, pushed by Commissioner Mark Thompson, agreed to
add the exclusion. The new pricing is set to go into effect Feb. 1.
