Energy companies seek to preempt natural gas ban

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The state’s three biggest natural gas companies on Tuesday predicted that utility customers would pay exorbitantly more to power their homes and businesses if a national trend to ban natural gas took hold in Kansas.

Representatives from Kansas Gas Service, Atmos Energy and Black Hills Energy asked lawmakers to pass legislation that would preemptively stop local governments from banning natural gas connections similar to ordinances on the West and East coasts.

“Elimination of natural gas as an energy source would have a dramatic economic impact on residences and businesses across our great state,” said Jerry Watkins, general manager of of Black Hills Energy, which serves 115,000 Kansas customers.

“Naturally, the average household would see their energy costs increase by 50% if natural gas was eliminated,” Watkins said. “This does not include costs associated with upgrading of appliances, upgrading the electrical panels and wiring or appliance replacement.”

Likewise, Watkins said a natural gas ban would drive up costs for Kansas businesses, potetially putting products manufactured here at a competitive disadvantage.

It was the first of two days of hearings on the bill, with the opponents scheduled to testify Wednesday. A committee vote is set for Thursday.

So far, Arizona, Tennessee, Oklahoma and Louisiana have all passed similar laws to what has been proposed in Kansas. Another four states have considered similar legislation.

No city in Kansas has banned natural gas, but there are concerns that a ban on natural gas for new buildings in Berkeley, California – the first in the country – could spread nationally.

The gas companies have expressed concern about a Lawrence city ordinance that calls for going to carbon-free energy sources by 2035.

The ordinance would apply to natural gas unless it’s produced by a carbon-free source.

Natural gas does not qualify as clean renewable energy because of its emissions and environmental impacts, city officials said.

That could change if natural gas utilities secure renewable sourcing like landfill methane, they said.

Watkins said that Lawrence’s goals would have the unintended effect of raising the bills for about 32,000 customers who live there by 50% or more.

He said 85% of Lawrence homes would be hit with that increase, not counting the cost of replacing gas furnaces and hot water heaters.

The bill only applied to bans enacted by municipalites. It does not apply to individual homes or businesses that could decide to pursue their own energy option.

The utility companies were joined in their support for the bill by AARP, which said that potential bans on natural gas would force Kansans to rely on more expensive electricity.

“Many of our 291,000 Kansas members are on low or fixed incomes or have been adversely affected by COVID-19,” Ernest Kutzley of AARP told the committee.

“These customers do not have the additional money it would take to switch to a more expensive fuel source,” he said.

Democratic state Sen. Marci Francisco drew a distinction between Lawrence’s ordinance and what the city of Berkeley enacted.

She expressed concern that the bill was written in a way that it might stop a city from making its own decisions about energy use for its buildings.

Patrick Vogelsberg, the lobbyist for Kansas Gas, said while Lawrence’s goals have been characterized as “aspirational,” the city would still need to restrict natural gas to comply with its environmental benchmarks.

Vogelsberg said the bill is not intended to prohibit local governments  – like an individual homeowner or business – from making their own energy choices.

“If they wanted to go 100% electric for municipally owned buildings or property, they could do so under this,” he said.

Republican Sen. Mike Thompson, chair of the Senate Utilities Committee, said he thinks the bill is important in making consistent statewide energy policy, not one that could be left to be made from city to city.

“I think it’s important that we not restrict the ability to use an energy source in the state of Kansas,” Thompson said.

“We don’t want to circumvent home rule, but in this case it’s incumbent upon the state to make a uniform rule.

“If you start down that path, you’re going to run businesses out of some communities toward other communities where natural gas is available,” he said.

“It will create all sorts of weird distortions in the economy.”