NYS lawmakers seek to end the 100-foot rule for natural gas hookups
Gov. Kathy Hochul and key state lawmakers want to abolish a 43-year-old state law that requires utilities to routinely connect natural gas lines to most new industrial sites, businesses and homes. Credit: Howard Schnapp
ALBANY — Gov. Kathy Hochul and key state lawmakers want to abolish a 43-year-old state law that requires utilities to routinely connect natural gas lines to most new industrial sites, businesses and homes in a practice they say drives up utility bills for all New Yorkers and is counter to the state’s effort to combat climate change.
This provision of state public service law is referred to as the “100-foot rule,” which dates to 1981. The rule requires energy companies to hook up any new manufacturer, business or home to its gas line, if the transmission line is within 100 feet of the structure and the customer wants the hookup. The connection is provided at no charge to the new customer and the cost is then spread among all gas ratepayers. Supporters of eliminating the rule estimate that it costs ratepayers between $200 million to $300 million statewide per year.
Hochul's recent call to end the rule is similar to a bill in the State Legislature known as the NY Heat Act. Both efforts are aimed at transitioning energy in New York away from fossil fuels such as natural gas, which create greenhouse gases and contribute to global warming.
Natural gas companies and the state’s biggest labor union, both of which have great influence in Albany, oppose ending the 100-foot rule. They argue it will cost good-paying jobs and increase utility bills by reducing the use of natural gas. They argue that natural gas will continue to be less expensive than electric power as the state transitions away from fossil fuels.
The rule was created when the state sought to encourage greater use of natural gas. The state created an incentive for energy companies to replace electricity generated in power plants using coal and oil, which emitted greenhouse gas toxins into the air and water. Natural gas was determined to be a cleaner, more efficient way to power factories as well as commercial and residential buildings.
Most states adopted similar measures.
Today, power plants that produce electricity burn far cleaner, and wind and solar power are increasingly being used to produce electricity. The 2019 state Climate Leadership and Community Protection Act requires the state to limit greenhouse gas emissions to 60% of 1990 levels by 2030 and 15% of 1990 levels by 2050. To meet that goal, the state must dramatically reduce the use of natural gas in measures that are mostly aimed at new construction.
Yet the 100-foot rule continues to routinely connect structures to natural gas lines. Natural gas contains methane — a greenhouse gas that is highly flammable and forces additional costs for maintaining lines and contending with potentially dangerous leaks.
In Hochul’s State of the State presentation earlier this month, which details her 2024 priorities, she called for eliminating the rule to stop New Yorkers “from bearing the cost of unwarranted investment in fossil fuel infrastructure.”
The proposal comes as Hochul is also seeking to help build as many as 800,000 more housing units over the next decade to contend with a housing affordability crisis, while also attracting more manufacturers and other companies. If the 100-foot rule remains in place, that could mean a huge increase in homes and industries heated and powered by natural gas just as the state wants to aggressively reduce use of fossil fuels.
The administration emphasizes that eliminating the 100-foot rule wouldn’t ban new gas hookups or take away anyone’s existing gas service. New customers could still get natural gas service, but they or the gas company would have to pay for it rather than all ratepayers.
“It simply ends the legal requirement that current customers pay for new customers’ gas hookups,” said Katy Zielinski in a statement from the administration to Newsday. “Eliminating the ‘obligation to serve’ rule for natural gas will empower the Public Service Commission to conduct gas transition planning and protect consumers.”
The sponsors of the NY Heat Act bill call the rule a subsidy to gas companies.
“It just makes no sense,” said the bill’s co-sponsor, Senate Finance Committee Chairwoman Liz Krueger (D-Manhattan). “And we save ratepayers as we go. So why would we keep outdated laws?”
Assemb. Patricia Fahy (D-Albany), a co-sponsor, said the measure is stronger now with Hochul’s support. The bill also would limit the utility bills of lower- and middle-income households during the transition away from gas and other petroleum energy sources, but Hochul hasn’t signed on to that.
“We’re on autopilot with gas hookups,” Fahy said. “We are not on track to meet the climate goals … this is perpetuating part of the problem.”
The NY Heat bill states that “New York will need to drastically reduce gas use. This poses a particular challenge for gas utilities because their business models are premised on expanding — not contracting — gas infrastructure and services.”
Krueger and Fahy said the state Public Service Commission could still provide exceptions for new factories, other big energy users and homes to tap into natural gas lines if they can prove the need.
In 2022, California ended its similar rule and other states are considering it.
The measure is expected to be part of negotiations between the governor and Democrats who control the Senate and Assembly as they craft a 2024-25 budget, which is due by April 1.
The 100-foot rule has so far withstood challenges.
The NY Heat bill was first proposed in 2021, but died in committee amid opposition by major energy companies. Now, state lobbying records show the opposition is led by the New York State AFL-CIO, which is a federation of 3,000 labor unions, including those that represent energy company workers. The AFL-CIO wields substantial influence with Democrats who control Albany, and the organization and its members are major campaign contributors, according to state Board of Elections records.
AFL-CIO president Mario Cilento said removing the 100-foot rule is unwise for New York and consumers.
“We need to have enough alternative energy that is readily available and affordable across the state before proposals like the NY Heat Act are considered and as of now, that is just not the case,” Cilento said. “We have yet to see the governor’s proposal and will take a position after it is released.”
Fahy said she is working on amendments to the NY Heat bill to try to deal with the concerns of the AFL-CIO. But gas companies are also mounting a public campaign.
The New Yorkers for Affordable Energy group says elimination of the 100-foot rule “threatens good-paying union jobs at a time when our state can ill afford such losses.” Its campaign includes TV ads and press events.
“In many areas, natural gas is the most affordable option for an average family,” said the Albany-based advocacy group. “This proposal would move this choice out of reach for all but the most affluent families …."
The group states in its 2020 tax return that its “mission is to expand natural gas service” to bring affordable heat and energy “helping to keep energy prices low for consumers.” The directors listed in the tax return had worked for the National Grid and National Fuel, according to their published backgrounds.
The group didn’t respond to a request for comment.
The American Petroleum Institute, which lobbies for energy companies, referred comment to the American Gas Association, which didn’t respond to a request for comment.
Supporters argue the need to end the 100-foot rule is clear.
“It’s going to be very challenging to do that if we leave the public service law as it is, which is extremely preferential to gas,” said Elizabeth Moran, the Northeast policy advocate for Earthjustice, a nonprofit environmental law firm. “It’s dated.”
ALBANY — Gov. Kathy Hochul and key state lawmakers want to abolish a 43-year-old state law that requires utilities to routinely connect natural gas lines to most new industrial sites, businesses and homes in a practice they say drives up utility bills for all New Yorkers and is counter to the state’s effort to combat climate change.
This provision of state public service law is referred to as the “100-foot rule,” which dates to 1981. The rule requires energy companies to hook up any new manufacturer, business or home to its gas line, if the transmission line is within 100 feet of the structure and the customer wants the hookup. The connection is provided at no charge to the new customer and the cost is then spread among all gas ratepayers. Supporters of eliminating the rule estimate that it costs ratepayers between $200 million to $300 million statewide per year.
Hochul's recent call to end the rule is similar to a bill in the State Legislature known as the NY Heat Act. Both efforts are aimed at transitioning energy in New York away from fossil fuels such as natural gas, which create greenhouse gases and contribute to global warming.
Natural gas companies and the state’s biggest labor union, both of which have great influence in Albany, oppose ending the 100-foot rule. They argue it will cost good-paying jobs and increase utility bills by reducing the use of natural gas. They argue that natural gas will continue to be less expensive than electric power as the state transitions away from fossil fuels.
The rule was created when the state sought to encourage greater use of natural gas. The state created an incentive for energy companies to replace electricity generated in power plants using coal and oil, which emitted greenhouse gas toxins into the air and water. Natural gas was determined to be a cleaner, more efficient way to power factories as well as commercial and residential buildings.
Most states adopted similar measures.
Today, power plants that produce electricity burn far cleaner, and wind and solar power are increasingly being used to produce electricity. The 2019 state Climate Leadership and Community Protection Act requires the state to limit greenhouse gas emissions to 60% of 1990 levels by 2030 and 15% of 1990 levels by 2050. To meet that goal, the state must dramatically reduce the use of natural gas in measures that are mostly aimed at new construction.
Yet the 100-foot rule continues to routinely connect structures to natural gas lines. Natural gas contains methane — a greenhouse gas that is highly flammable and forces additional costs for maintaining lines and contending with potentially dangerous leaks.
In Hochul’s State of the State presentation earlier this month, which details her 2024 priorities, she called for eliminating the rule to stop New Yorkers “from bearing the cost of unwarranted investment in fossil fuel infrastructure.”
The proposal comes as Hochul is also seeking to help build as many as 800,000 more housing units over the next decade to contend with a housing affordability crisis, while also attracting more manufacturers and other companies. If the 100-foot rule remains in place, that could mean a huge increase in homes and industries heated and powered by natural gas just as the state wants to aggressively reduce use of fossil fuels.
The administration emphasizes that eliminating the 100-foot rule wouldn’t ban new gas hookups or take away anyone’s existing gas service. New customers could still get natural gas service, but they or the gas company would have to pay for it rather than all ratepayers.
“It simply ends the legal requirement that current customers pay for new customers’ gas hookups,” said Katy Zielinski in a statement from the administration to Newsday. “Eliminating the ‘obligation to serve’ rule for natural gas will empower the Public Service Commission to conduct gas transition planning and protect consumers.”
The sponsors of the NY Heat Act bill call the rule a subsidy to gas companies.
“It just makes no sense,” said the bill’s co-sponsor, Senate Finance Committee Chairwoman Liz Krueger (D-Manhattan). “And we save ratepayers as we go. So why would we keep outdated laws?”
Assemb. Patricia Fahy (D-Albany), a co-sponsor, said the measure is stronger now with Hochul’s support. The bill also would limit the utility bills of lower- and middle-income households during the transition away from gas and other petroleum energy sources, but Hochul hasn’t signed on to that.
“We’re on autopilot with gas hookups,” Fahy said. “We are not on track to meet the climate goals … this is perpetuating part of the problem.”
The NY Heat bill states that “New York will need to drastically reduce gas use. This poses a particular challenge for gas utilities because their business models are premised on expanding — not contracting — gas infrastructure and services.”
Krueger and Fahy said the state Public Service Commission could still provide exceptions for new factories, other big energy users and homes to tap into natural gas lines if they can prove the need.
In 2022, California ended its similar rule and other states are considering it.
The measure is expected to be part of negotiations between the governor and Democrats who control the Senate and Assembly as they craft a 2024-25 budget, which is due by April 1.
The 100-foot rule has so far withstood challenges.
The NY Heat bill was first proposed in 2021, but died in committee amid opposition by major energy companies. Now, state lobbying records show the opposition is led by the New York State AFL-CIO, which is a federation of 3,000 labor unions, including those that represent energy company workers. The AFL-CIO wields substantial influence with Democrats who control Albany, and the organization and its members are major campaign contributors, according to state Board of Elections records.
AFL-CIO president Mario Cilento said removing the 100-foot rule is unwise for New York and consumers.
“We need to have enough alternative energy that is readily available and affordable across the state before proposals like the NY Heat Act are considered and as of now, that is just not the case,” Cilento said. “We have yet to see the governor’s proposal and will take a position after it is released.”
Fahy said she is working on amendments to the NY Heat bill to try to deal with the concerns of the AFL-CIO. But gas companies are also mounting a public campaign.
The New Yorkers for Affordable Energy group says elimination of the 100-foot rule “threatens good-paying union jobs at a time when our state can ill afford such losses.” Its campaign includes TV ads and press events.
“In many areas, natural gas is the most affordable option for an average family,” said the Albany-based advocacy group. “This proposal would move this choice out of reach for all but the most affluent families …."
The group states in its 2020 tax return that its “mission is to expand natural gas service” to bring affordable heat and energy “helping to keep energy prices low for consumers.” The directors listed in the tax return had worked for the National Grid and National Fuel, according to their published backgrounds.
The group didn’t respond to a request for comment.
The American Petroleum Institute, which lobbies for energy companies, referred comment to the American Gas Association, which didn’t respond to a request for comment.
Supporters argue the need to end the 100-foot rule is clear.
“It’s going to be very challenging to do that if we leave the public service law as it is, which is extremely preferential to gas,” said Elizabeth Moran, the Northeast policy advocate for Earthjustice, a nonprofit environmental law firm. “It’s dated.”
Michael Gormley has worked for Newsday since 2013, covering state government, politics and issues. He has covered Albany since 2001.
