A Trojan Horse That Would Subvert Climate Justice in New York

New York’s landmark climate law, the Climate Leadership and Community Protection Act (Climate Act), is once again under attack by New York’s gas utilities. 

The attacks are no surprise. New York’s gas utilities (with the notable exception of Con Edison) have positioned themselves as the leading voices of efforts to weaken the state’s climate and building decarbonization policies by spreading misinformation and stoking fear of higher energy bills, which is especially effective because of inflation and rising fossil gas prices.

The gas utilities’ latest attack comes in the form of a new bill—S6030—which was inserted into legislative budget negotiations at the eleventh hour. The bill would change the foundational greenhouse gas (GHG) emissions accounting that underpins the Climate Act’s emission limits. The proposed changes reflect the persistent and insidious efforts of fossil interests to slow-walk the clean energy transition to the benefit of their shareholders, but at the expense of all New York energy customers.

S6030 proposes changes that undermine the Climate Act

The new bill includes two distinct accounting changes:

1. It would shift from a 20-year to a 100-year time horizon: S6030 purports to align New York’s emission accounting methodology with a federal methodology by shifting the measurement of GHG’s warming effect from a 20-year time horizon to a 100-year time horizon. This accounting change has rightfully received backlash for how it would weaken the nation-leading emission limits established in the Climate Act.

A 20-year time frame places greater weight on short-term GHG impacts. For example, when methane vents into the atmosphere, it traps about 30 times more heat than carbon dioxide over 100 years, and more than 80 times the amount of heat over a 20-year period. 

The proposed shift from 20 to 100 years obscures the enormous short-term impacts of methane, from both biogenic and fossil sources, and undermines the clear and resounding warnings from every authority, including the most recent Intergovernmental Panel on Climate Change (IPCC) report, which emphasizes the urgency of near-term integrated climate action. 

2. It would open the out-of-state RNG floodgates: S6030 also includes a second, distinct, and far more problematic accounting change by requiring “full life-cycle basis” accounting. This change has thus far received little public attention, but it is a Trojan horse that would unleash a flood of biomethane (aka “renewable” natural gas or “RNG”) imports into New York in a way that exports the benefits of the climate action out of state while further entrenching the harms of the fossil gas system that has wreaked havoc on New York’s economy, environment, and public health for far too long. 

RNG is a false solution for decarbonizing buildings

As explained in NRDC’s issue brief, RNG (aka biogas) is methane derived from biogenic (organic) sources such as landfills, sewage treatment facilities, forests, livestock operations, and farms. It is produced through either anaerobic digestion or thermal gasification processes that capture “fugitive emissions” that would have otherwise vented into the atmosphere as part of a natural carbon cycle. 

RNG is often considered “zero carbon” over its life cycle because its organic material fuel sources (feedstocks) have absorbed fugitive emissions that offset the emissions produced when the RNG is combusted. This, however, is not always the case in practice. Properly accounting for the climate impacts of RNG includes the energy required to produce it, whether the source creates new methane where none or little would have existed otherwise, and how much methane leaks during production. 

Importantly, even when it can be considered to produce net-zero GHG emissions over its life cycle, RNG emits toxic air pollutants when burned that are detrimental to human health and the environment. In short, RNG does not avoid the many health harms of fossil gas.

New York’s Climate Act and Climate Action Council Scoping Plan—the blueprint for achieving the Climate Act targets developed by representative stakeholders and government officials over the last three years—recognize that RNG is a false solution for decarbonizing buildings. 

Achieving the state’s climate targets requires a dramatic reduction of fossil gas use while transitioning the vast majority of gas customers to electricity. The Scoping Plan thus calls for a well-planned and strategic downsizing of the gas system to maximize environmental benefits and minimize “stranded costs” of the legacy gas system that would likely be paid for by ratepayers and taxpayers long after the gas infrastructure is no longer in use.

The Climate Act’s GHG emissions accounting protects against the proliferation of imported RNG

Any GHG emission accounting system must accurately reflect the emission impact of the full life cycle of RNG, from feedstock development to production, transmission, distribution, and end use; however, this emission reduction benefit can only be counted once—either in the sector that produces the RNG or the sector that consumes the RNG.

The Climate Act establishes the framework for New York’s emission accounting system that is implemented by the Department of Environmental Conservation (DEC) and used to measure achievement of the emission limits. Pursuant to the Climate Act, DEC implemented a gross emissions accounting system that measures the total amount of GHG emissions released into the atmosphere in New York, including the out-of-state emission impacts for imported fossil fuels. 

Under this gross emissions accounting approach, the emission reduction benefits of RNG are reflected at the point of production in the sector that captured the fugitive emissions through the processing of RNG feedstock (i.e., the agriculture and waste sectors). When the RNG is burned, it accounts for the same emission impact as burning fossil gas in the sector that consumes the gas (i.e., buildings, electricity, industry). From an economy-wide accounting perspective, the emissions reductions from the production of RNG offset the emissions increases from combusting the RNG.

Importantly, this gross accounting system only reflects the emission reduction benefits of RNG that are produced in-state because RNG produced out-of-state does not reduce emissions in New York. This is the appropriate framework for state-level climate policy that’s intended to remedy the in-state harms of fossil fuel use and deliver economic, environmental, and health benefits to New Yorkers.

S6030 would transfer the emission reduction benefits of RNG production to the purchasers of utility gas while pushing the economic, environmental, and health benefits of climate action out of state.

S6030 proposes to change the fundamental data underpinning the Climate Act while inaccurately citing undefined “internationally accepted best practices” that are not applicable to subnational GHG inventories, according to the IPCC (see Q1-4-1). 

Specifically, the bill would replace New York’s gross accounting system with a net accounting system by mandating use of a specific “full life-cycle” model. Under this full life-cycle net emissions accounting approach, the emission reduction benefits of producing RNG are netted against the emissions impacts that occur through the remainder of the life cycle. This net accounting system applies the net effect of the emissions to the sector that consumes the RNG.

S6030 further entrenches “full life-cycle” net emissions accounting by (1) requiring that the emission reduction benefits associated with RNG production be imported into the state and counted toward the statewide total emissions, and (2) mandating that emissions from the combustion of RNG are not counted toward the statewide greenhouse gas emissions limits—regardless of whether the process to produce the RNG actually fully offset the emissions of burning RNG.

This change to “full life-cycle” net emissions accounting would constitute a fundamental transfer of the emission reduction benefits of RNG from the sectors that produce the RNG to the sectors that consume the RNG.

Establishing this benefit transfer is the primary objective of the gas utilities that have led the push for S6030 because it ensures the emission reduction benefits of RNG accrue to the purchasers of utility gas, which facilitates the continued use of the utilities’ gas system to the benefit of their shareholders and at the expense of all New York energy customers.

S6030’s net emission accounting would have two devastating impacts for New York 

First, it would dramatically elevate RNG use in buildings and electricity production, because whenever RNG is burned in a furnace or fossil gas generation resource, it would be considered zero emissions for the purposes of compliance with the Climate Act emission limits. This contradicts the Scoping Plan, which highlights the importance of electrification and does not endorse any widespread use of RNG in buildings. 

Second, it would open the door—for the first time—to RNG imports as a strategy for climate action in New York. This would be particularly devastating because it results in the economic, environmental, and health benefits occurring out of the state where the RNG is produced, and it perpetuates the economic, environmental, and heath harms of burning RNG in-state—harms that are indistinguishable from those caused by the burning of fossil gas.

S6030, through a seemingly innocuous accounting trick, would facilitate a proliferation of imported RNG into New York, and would thereby lead to misdirected climate investments, lost opportunities for emissions reductions, and the weakening of the co-pollutant reductions that the Climate Act emphasizes as being of equal importance to GHG reductions in delivering climate justice. 

Will Governor Kathy Hochul and the New York Legislature stand up to gas utilities? Stay tuned… 

New York’s gas utilities (with the notable exception of Con Edison) are leaders of the fossil fuel front group, New Yorkers for Affordable Energy, which spent millions of dollars fearmongering about the cost of the state’s clean energy transition in order to expand gas use. The governor and certain members of the legislature appear sympathetic to this disinformation campaign, signaling their support for accounting changes in the name of affordability.

If the governor and the legislature want to save New Yorkers money, there's no need to gut the Climate Act; they can simply pass the NY Home Energy Affordable Transition (HEAT) Act (S2016), which removes statutory barriers to the strategic downsizing of the gas system and will save ratepayers billions of dollars that utilities would otherwise spend on unnecessary gas infrastructure. It also ensconces in legislation the state’s heretofore unimplemented “policy” of capping energy costs at 6 percent of household income, a critical protection for New York’s most vulnerable residents.

The governor and the legislature should stand up to gas utilities’ attempts to burden New Yorkers with the costs of maintaining their polluting systems. Moreover, no elected representative of New Yorkers should support policy that exports the benefits of climate action while further perpetuating the very same economic, environmental, and heath harms of burning gas in-state that the Climate Act was intended to address.

This blog provides general information, not legal advice. If you need legal help, please consult a lawyer in your state.