Oregon lawmakers, groups demand investigation over NW Natural’s gas claims

By Monica Samayoa (OPB)
Aug. 18, 2022 2:19 a.m.

Environmentalists say utility is producing “deceptive” advertisements, school materials

More than two dozen organizations along with Oregon lawmakers are calling on the state’s Department of Justice to investigate Oregon’s largest natural gas utility over what they claim is false advertising to the public and in schools.

On Wednesday, six Oregon elected officials and more than 30 climate justice and environmental organizations submitted a petition asking Oregon’s attorney general to investigate claims that NW Natural is misleading the public and schoolchildren about the environmental and health impacts of natural gas. The company is the state’s largest gas utility and serves more than 2.5 million people across the Pacific Northwest. (NW Natural Appliance Center, a subsidiary of NW Natural, is an OPB sponsor.)

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The letter says NW Natural is buying “deceptive” local newspaper advertisements and spending tens of thousands of dollars creating children’s workbooks to distribute to Oregon schools. Its online materials promote safety. Workbooks and activity sheets shared by the environmental groups are often more promotional, with phrases like: “natural gas, your invisible friend,” “pump it up” and “natural gas is great.” The workbook also states that “natural gas appliances are safe, efficient, and economical.” It is not clear whether the material has been distributed to students in Oregon schools.

NW Natural has not responded to a request for comment about the letter’s claims.

The group calling for an investigation claims the utility is misleading the public regarding its energy investments and says NW Natural is “greenwashing” — a form of advertising spin to deceptively persuade the public that a company or organization’s products are environmentally friendly.

“That’s kind of just the tip of the iceberg,” Oregon Environmental Council’s climate program director Nora Apter said. “They’ve really been engaged in rampant greenwashing for decades, and that is aimed at perpetuating their business model and continuing to ensure that there is a broad customer base that is relying on fossil gas in Oregon.”

Apter said that when people hear terms like “renewable natural gas” or “natural gas” they often assume those words refer to a clean and safe alternative to fossil fuels, when in reality those products are primarily composed of methane.

Methane is a greenhouse gas that is 86 times more potent at trapping heat in the atmosphere than carbon dioxide over a 20-year period. Methane is emitted from a variety of sources including, oil and natural gas systems, landfills, coal mining and wastewater treatment. It’s become one of Oregon’s fastest-growing sources of energy and it’s mostly imported via pipeline from across the county. The state’s natural gas capacity has tripled over the past decade. Power from natural gas-fired energy plants made up 28% of the state’s electric generation and supported 21% of the state’s energy consumption in 2018.

“So, we’re talking about an explosive fuel that creates really harmful indoor air pollution,” Apter said. “And it seems like every day there’s a new report about just how harmful burning methane in our homes is for our health.”

On its website, NW Natural has listed several potential scenarios that would allow it to decarbonize all of its gas by 2050, but nothing is set.

Oregon Department of Justice communications director Kristina Edmunson said a team of attorneys specializing in utility regulation and natural resources will review the letter. The agency said its consumer protection team has often pursued cases that involve misrepresenting materials to children and takes the obligation to protect the most vulnerable seriously.

Natural gas facing many challenges

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NW Natural’s future in Oregon is facing many challenges – from climate and environmental justice groups as well as promises from the federal government to move away from fossil fuels in homes and commercial buildings.

During a global climate summit in Scotland last year, the Biden administration pledged to drastically cut methane emissions by 2035. Climate scientists and researchers also rang alarms in a recent Intergovernmental Panel on Climate Change report that said methane emissions need to be greatly reduced to limit catastrophic disasters like increased drought, heatwaves and wildfires.

There’s also been a major push to electrify homes and transition away from using gas in new commercial buildings. Last month, the Eugene City Council moved a step closer toward banning natural gas in newly constructed homes starting in June 2023. Seattle has already moved to ban natural gas appliances in new buildings at least four-stories tall starting this year.

Bethany Cotton, the conservation director at Cascadia Wildlands, said she hopes the Oregon Department of Justice will instruct NW Natural to stop distributing misleading information to the public under a state law that protects consumers from bad business practices. Under the Unlawful Trade Practices Act, companies are prohibited from passing off goods or services that misrepresent their benefits, uses or services to customers.

“We’d also like to see the attorney general add a warning to natural gas to let folks know that there’s nothing really natural about it,” she said. “It’s a dangerous climate-killing commodity.”

Cotton said the attorney general could require NW Natural to add a warning label in a manner similar to tobacco and other harmful products.

“We really have to put our communities and our health first and move toward a safer and more climate resilient future,” she said.

The letter to the Oregon Department of Justice also claims that NW Natural is misusing ratepayer funds to buy advertisements, such as by purchasing kids’ workbooks to distribute in schools, to lead children to think positively about natural gas and to believe that it’s climate friendly.

Bob Jenks, executive director of the Oregon Citizens Utility Board, said NW Natural cannot use any of its advertising funds to promote its products and corporate image.

“Shareholders have to pay for it,” he said.

Jenks’ group represents ratepayers and is the state’s main utility watchdog. He said he did not sign the letter sent to the DOJ or look into the legality of the utility’s spending. But he said his group became aware of the alleged misuse of funds when NW Natural proposed raising rates for customers. Customers could ultimately face three rate hikes between October 2021 and November 2022. Rates have already been increased to reflect the higher commodity cost of natural gas, Jenks said. NW Natural is proposing two more rate hikes — another commodity cost hike and a general rate-case hike, which would pay for CEO salaries, advertising, profits and other company expenses other than the gas commodity.

According to Jenks, ratepayers are looking at a 42.4% increase in a 13-month period.

He said the Oregon Citizens Utility Board is working with NW Natural to reduce rate increases and settle on what costs can be put off until after the winter. Jenks said that would help save ratepayers money, because winter is when customers use gas the most to heat their homes.

“We’re asking sort of separately with the company to say, ‘Can we change when these are recovered from customers?’ and try to sort of alleviate the real problem that we’re going to have this winter of people getting huge bill increase, huge rate increase, that, if you combine it with a colder than normal winter, are really going to destroy people’s budgets,” he said.

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