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HEAT Act aims to get ratepayers off gas by phasing out gas-line extension allowances: What does that mean?

  • / Updated:
  • Edwin Viera 

New York State’s Legislature is reviewing a bill to align the state’s public utility law with its climate goals. The New York HEAT Act aims to get ratepayers off of gas by phasing out gas-line extension allowances. The bill would also provide the Public Service Commission with the authority to keep utility companies in line with the state’s climate laws. According to the U.S. Environmental Protection Agency, methane gas was the second largest greenhouse gas to be emitted in 2021 behind carbon dioxide. The transition to more climate-conscious alternatives from gas will take some time.

Justin Flagg, director of environmental policy for State Sen. Liz Krueger, D-Manhattan, said more needs to be done.

“The first step is to stop digging. And, that’s why removing the hundred-foot rule and this incentive to expand the gas system; we need to stop expanding the gas system right now,” Flagg said. “And then, we need to think carefully about where we can downsize the gas system.”

He added an important place to consider downsizing the gas system is leak-prone pipes. A 2021 study from the University of Texas found between 3.3% and 4.7% of methane escapes the gas supply chain in urban areas. Gas companies such as National Grid make up the bulk of the bill’s opposition. This bill is under review by the state Senate’s Energy and Telecommunications Committee.

During this transition, certain rules and regulations will be removed, including the Hundred Foot Rule, which requires utilities to connect new customers to a gas line for free based on how close their property is to an existing main gas line, typically within 100 feet.

Meagan Burton, senior attorney with EarthJustice contended this has benefited gas companies.

“From 2017 to 2021, utilities were able to shift just about $1 billion of costs onto about 170,000 new ratepayers,” she said.

This averages out to almost $6,000 that was subsidized across all gas payers for each new ratepayer. Since ratepayers, instead of utility companies, pay for these extensions, this acts as an incentive to keep growing the gas system.

In place of the state’s gas system, heat pumps will be installed in communities across the state.

Rich Schrader, policy and legislative director with the Natural Resources Defense Council, said non-combustible gas could be allowed under the HEAT Act.

“There’s an opportunity here for hydrogen, if that plays out. Nobody’s endorsing hydrogen use right now, but it’s something that as we see this technology mature and evolve over time that could be used in this, ” he said.

New York is not alone in doing away with methane gas. In 2022, the White House issued guidance on the U.S. Methane Emissions Reduction Action Plan. The plan calls for acceleration of methane reduction through a series of solutions, such as plugging leaks from abandoned gas wells.