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Building Electrification or New Ways to Tax Residents? Montgomery County Approves New Natural Gas Ban

Backed by a 9-0 vote, Maryland’s Montgomery County Council became the first county on the East Coast to ban natural gas in new buildings, renovations, and additions in November. The bill’s all-electric mandates will contribute to several negative consequences for both residents and the economy, and its passage highlights how municipal leaders often fail to consider the true implications of banning energy access for residents.

Not all Efforts are Good Faith

Identified as the Comprehensive Building Decarbonization Bill 13-22 plan and initially introduced in June 2022, the ban was passed during the last meeting of the session with the county’s current council members. The eleventh-hour passage of the bill by an outgoing council occurred despite the failure of a state-level ban to be included in the 2022 Climate Solutions Now Act (SB528). In addition, the new regulations come following the Maryland Energy Administration’s announcement to provide $9.25 million in funding to expand the state’s natural gas infrastructure.

Once the mandate is finalized, new buildings in the county will be limited to electricity for power and heating purposes, forcing residents to endure higher heating costs in 2026. In addition to rising utility costs, homes will overall become more expensive because of the necessary retrofits needed for compliance, further restricting the property ownership and first-time buyer process.

A Half Measure of Bad Faith

From the policy’s proposal to its approval, the bill has changed significantly, adding many amendments and additions to its exemptions lists. In fact, the numerous exemptions to the ban have partially saved local industry which in large cities like Baltimore could cost the loss of 2,400 jobs.

Some of the establishments with exemptions include restaurants, manufacturing facilities, and crematories. Those with different building types also warrant exemption status, with places such as public housing, schools, and residences with four or more stories on the list as well.

Although deemed “a giant step forward toward cleaner buildings and a better climate” by Democratic council member Hans Riemer, policymakers did not effectively evaluate the true implications of passing the bill on low and middle-income residents, first-time homeowners, new construction, affordability housing projects, and ratepayers in the community. While county officials analyzed mixed findings on the impact of businesses and construction, they failed to gather actual insight and awareness from the groups most impacted because they only hosted one public hearing for an initiative this significant.

Effects of Fossil Fuel Bans

The cost-to-benefit ratio of implementing natural gas bans isn’t quite as great as it is often claimed.

According to Kenneth W. Costello, a regulatory economist and independent consultant with experience at the National Regulatory Research Institute, Illinois Commerce Commission, and Argonne National Regulatory Laboratory:

“Less than 9 percent of carbon emissions in the U.S. comes from the direct use of natural gas in homes and buildings. The U.S. emits about 15 percent of the world’s carbon emissions; thus, converting all buildings to electric and assuming that all electricity is produced from clean sources, the reduction in worldwide carbon emissions would be less than 1.5 percent, which, according to most computer-based forecasting models, would have no detectable effect on global climate.”

As such, gas bans can do far more harm than good to the communities affected. For example, in other areas fossil fuel bans have been implemented, residents saw price increases four times the costs of natural gas.

The cost implications on homeowners are another byproduct. To accommodate all-electric mandates, homeowners will have to retrofit with electric systems and appliances that are often more expensive than natural gas. In other cases, tenants are subject to the same faith of having to “bear the brunt of the cost” for these updates.

Increased utilities costs are also on the horizon when gas bans are implemented. While evident all over the country, consumers in Maryland are already having to pay higher costs for their energy bills. As a result of colder-than-normal winters, increased demand, and the Russia-Ukraine war, residents throughout Maryland and nearby areas are in a state of serious energy instability.

Before fossil fuel bans came to fruition in the state, utility prices were already rising. In one year, the Bureau of Labor found costs of electricity increased by 14.1 percent. As the popularity of banning fossil fuels grow, price increases will only be exasperated.

Simply put, Montgomery County residents will have to deal with the implications of rising utility costs despite not making a significant impact on climate goals.

Bottom Line

Bill 13-22 was created with intentions to fight the climate crisis through an ineffective natural gas ban, but will only harm consumers. Passing this bill puts the communities impacted by it in a difficult situation where they are essentially forced into a mandate with limited returns. This notion is not exclusive to just Montgomery County, but instead, everywhere these bans occur.

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