Title
Approval of a Resolution Expressing City Council Opposition to Washington State Ballot Initiative No. 2066 Concerning Regulating Energy Services, Including Natural Gas and Electrification
Recommended Action
Committee Recommendation:
Not referred to a committee.
City Manager Recommendation:
Accept testimony from everyone who wishes to speak for or against the Initiative Measure No. 2066.
Motion if Council wishes to oppose the Initiative: Move to Adopt the Resolution Expressing City Council Opposition to Initiative Measure No. 2066 Concerning Regulating Energy Services, Including Natural Gas and Electrification.
No action is needed if Council does not wish to adopt the Resolution.
Report
Issue:
Whether to oppose Initiative No. 2066 to Washington’s voters, which would repeal or prohibit certain laws and regulations that discourage natural gas use, and/or promote electrification, and require certain utilities and local governments to provide natural gas to eligible customers.
Staff Contact:
Pamela Braff, PhD, Director of Climate Programs, Office of Community Vitality, 360.753.8249
Presenter(s):
Pamela Braff, PhD, Director of Climate Programs
Background and Analysis:
The City Council requested this matter be placed on a City Council agenda so that the Council could conduct a public hearing and hear from citizens in support of or opposed to Initiative No. 2066.
In accord with RCW 42.17A.555, any action taken by the Council to support or oppose a ballot proposition must be done at a properly noticed open public meeting with an opportunity for anyone to comment for or against the ballot measure prior to City Council action.
Washington Decarbonization Act
In 2024, the Washington State Legislature adopted HB 1589, known as the “Washington Decarbonization Act”. This law helps Puget Sound Energy (PSE) plan to decarbonize and taper its natural gas service, to comply with the state’s climate and energy targets. The law does not ban natural gas in Washington.
The Decarbonization Act consolidates PSE’s numerous reporting and planning requirements into a single plan, which must be submitted to the Washington Utilities and Transportation Commission (UTC). The plan must forecast customer energy demand and provide proposals for reducing greenhouse gas emissions from its operations. PSE’s plan must describe how it will transition from natural gas to electricity in a cost-effective way and how it will coordinate with local utilities when it targets an area for further electrification. In deciding whether to accept or reject the plan, the UTC must consider whether it reduces greenhouse gas emissions, meets energy efficiency targets, and results in a reasonable cost to customers.
The Decarbonization Act also prohibits PSE from offering customers rebates or incentives to buy appliances that use natural gas. Instead, PSE must educate its customers about the benefits of transitioning to electricity and the availability of rebates or incentives for energy-efficient electric appliances.
The Decarbonization Act also sets requirements for how the UTC determines rates for PSE customers. For example, it would change how the UTC must calculate the depreciation of gas plants when determining rates.
Washington State Ballot Initiative 2066
If approved by Washington voters, Initiative Measure No. 2066 would:
• Require gas utilities, including those owned by a city or town, to provide natural gas to eligible customers who demand it, even if other energy services or energy sources are available.
• Prohibit utility rate plans that require or incentivize gas service termination, restrict access to gas service, or make it cost-prohibitive.
• Prohibit the state energy code, localities, and air pollution control agencies from prohibiting, penalizing, or discouraging the use of natural gas.
• Repeal sections of chapter 351, Laws of 2024, including planning requirements for cost-effective electrification and prohibitions on gas rebates and incentives.
Climate Analysis:
Passage of Ballot Initiative No. 2066 would limit the City’s ability to reduce greenhouse gas emissions and achieve adopted emissions reduction targets through state and local actions. This initiative would also limit the City’s implementation of the Thurston Climate Mitigation Plan (Strategy B6. Convert to Cleaner Fuel Sources), by preempting local governments from enacting policies to disincentivize the use of natural gas within their jurisdictional boundaries.
Equity Analysis:
Passage of Ballot Initiative No. 2066 could result in a loss of funding to support cities and community members in switching from natural gas to electric appliances. This loss of funding would likely have the most significant impact on low- and moderate-income households, who may be otherwise unable to afford the upfront costs of electrification retrofits.
Neighborhood/Community Interests (if known):
Not known.
Financial Impact:
I-2066 would reverse many of the provisions of the Decarbonization Act, including those that allow PSE to assess the potential for electrification within geographic areas and achieve cost-effective electrification for natural gas customers.
The Washington 2021 State Energy Strategy identified a combination of energy efficiency and electrification as the most cost-effective strategy to achieve state targets for greenhouse gas emissions from the built environment.
Options:
1. Approve the Resolution opposing Initiative No. 2066, which would repeal or prohibit certain laws and regulations that discourage natural gas use, and/or promote electrification, and require certain utilities and local governments to provide natural gas to eligible customers.
2. Approve the Resolution with modifications.
3. Do not approve the Resolution.
Attachments:
Resolution