– Advertising –
Environmental regulators in the state of Oregon are concerned that the state’s largest natural gas supplier is misinforming its customers about an important climate change policy designed to reduce greenhouse gases.
NW Natural, which supplies natural gas to more than two million people in Oregon and southwest Washington, told customers in a newsletter this month that the state was proposing a carbon credit program that may not result in direct reductions in greenhouse gas emissions.
According to the Oregon State Environmental Protection Agency, this is not the case.
“The fundamental purpose of Community Climate Investments is to support projects that reduce greenhouse gas emissions in Oregon,” Lauren Wirtis, a DEQ spokeswoman, said in an email.
NW Natural did not respond to a request for further information on Monday.
The carbon credits, known as Community Climate Investments, or CCIs, are part of the state’s landmark climate protection program, which was first passed in 2021 but is being overhauled this year following a court ruling in a legal dispute. NW Natural and two other natural gas companies filed the lawsuit to stop the protection program, which includes emissions reduction targets.
Under the climate program, the state would sell emissions credits to fossil fuel companies in Oregon to help them offset some of their greenhouse gas emissions and meet the state’s emissions goals. With its climate laws, the state seeks to reduce greenhouse gas emissions by 50% by 2035 and 90% by 2050 to address the growing threat of climate change. The Commission on Environmental Quality will vote by the end of the year on whether to approve the new climate program.
The draft regulations for the 2021 Climate Change Program update were published by the Oregon Department of Environmental Quality in late July. The agency gave the public until Friday, August 30, to comment here.
The money from the sale of each carbon credit would be invested in projects that reduce emissions in Oregon. One credit would be equivalent to one ton of carbon dioxide released into the atmosphere, and companies could buy them for $129 per credit.
Credits would mean emissions cuts
But NW Natural claimed in its newsletter that this was not the case.
“For carbon accounting purposes, DEQ will count CCIs as emissions savings even if a project has not reduced emissions,” it says. The sale of carbon credits, the newsletter says, “may – but does not have to – result in emissions reductions at some point in the future.”
In an email, Wirtis cited three provisions of the draft climate change program that say each credit the state sells must be equal to one ton of carbon dioxide not released into the atmosphere. The $129 cost per credit, which NW Natural’s newsletter calls “the most expensive in North America,” includes a 4.5 percent fee so the DEQ can pay for audits of all projects to ensure each credit reduces greenhouse gas emissions. The DEQ would report on compliance to the Environmental Quality Commission every two years.
The price per Oregon credit is about six times higher than the average cost of a credit in unregulated carbon markets and about 1.5 times higher than the price of average credits in state markets in California, Washington, and British Columbia, Canada.
Only projects that reduce emissions, such as insulating buildings, installing heat pumps or solar panels, or purchasing electric vehicles or vehicle chargers, would receive money from the sale of credits, according to DEQ officials. The recipients of the credits, mostly nonprofits working on community-based projects, would be the beneficiaries responsible for completing the work.
“DEQ developed this model rather than allowing companies to select their own offset projects to better ensure that Oregon communities are involved in project development, benefit directly from the projects by reducing pollutants, and that more communities can benefit from investments that support the transition to cleaner fuels and technologies,” Wirtis said.
In their newsletter, NW Natural officials also warned that residential tariffs could rise by as much as 14% in the first year of the climate program’s implementation and by 35% over the next decade. A footnote said the forecast was based on customers’ average consumption and weather conditions.
Charlotte Shuff, a spokeswoman for the watchdog group Citizens’ Utility Board, said it was difficult to judge the accuracy of those numbers without an analysis of the data the company used.
“It’s really hard to say how true the rate impacts NW Natural is referring to are,” she said via email. “We’ve seen a trend in the past of NW Natural inflating the impact of customer costs. They’ve done it in communications with customers. They’ve done it in presentations to legislators.”
– Advertising –
