How Natural Gas Bans Hurt Communities and Customers
In America, one in four young adults now lives with their parents. One cause for this shift is clear; adjusted for inflation, home prices increased 118 percent between 1965 and 2021, while median household income increased only 15 percent. For the average young person in America, renting is expensive, while buying outright has become significantly more difficult than it used to be. Proposals for bans on natural gas in new construction are poised to worsen this problem.
Natural gas bans can make housing more expensive. All electric homes require expensive retrofits, potentially driving up the overall cost of housing significantly. According to the National Association of Home Builders, for every thousand dollars the cost to construct a unit of housing increases, 117,932 families are priced out of being able to afford that unit. Young people and low-income households would be the first to be priced out – and their costs would not end there.
AGA conducted a study entitled Implications of Policy-Driven Residential Electrification. This study found that if 60 percent of residences in the regions studied were converted to electricity by 2035, the average affected household could see an increase of up to $1,420 per year in increased heating costs alone. Renters and homeowners alike would have to bear these increased costs directly or through increased rent.
The median pre-tax income for a 25-year-old in the United States is $34,371. In Virginia, that works out to $27,915 after taxes, or a monthly take-home of $2,326. The median monthly rent in the United States is now more than $2,000 a month. Pushing unpopular policies that risk dramatically increasing the cost of living isn’t just irresponsible – it’s outright malpractice, and the harm could be felt by millions. Bans on natural gas could hit low-income households the hardest. Despite all the harm these policies could inflict, the cruelest irony is that as far as efforts to fight climate change go, banning the use of natural gas is a bust. Implementing policy-driven electrification would reduce total U.S. GHG emissions by as little as 1 percent in 2035. The gas delivery system delivers three times as much energy on the coldest day of the year as the electrical system delivers on the hottest day. Replacing it would therefore mandate a quadrupling of the electric system, and of electrical generation.
The logic behind bans on natural gas is in part premised on a plentiful supply of solar panels. It also assumes the United States won’t have any difficulties obtaining these solar panels from overseas supplies like China over the next decades. The current situation in Europe highlights why betting the future of your energy production on factors outside your control can be a risky bet. If we need to quadruple our electrical generation but already face a crippling shortage of solar panels expected to last for years with the potential for further disruptions, the logical result is obvious. The gap between current supply and demand will be met with power plants, including coal plants. A massive buildout of coal infrastructure to enable bans on direct use of natural gas could lock us in to decades of additional GHG emissions from new coal plants, damaging efforts to fight climate change.
Banning direct use of natural gas could also cut residents off from renewable natural gas and green hydrogen, an increasingly prominent source of energy. Renewable hydrogen can be a zero-emissions form of energy storage, with the potential for highly efficient direct use in homes. There is a very real risk that homes built off the gas grid today will either require upgrades to connect them at a later date or suffer serious disadvantages to hybrid-capable housing.
Natural gas and gas distribution infrastructure has a tremendous amount to offer renters and homeowners. Whether a person is a renter or an owner, they deserve to take advantage of everything natural gas has to offer.