• Michael McDevitt
    FEB 09, 2024

    Villegas resolution calls for cost analysis, public hearing before Council considers limits on natural gas in new buildings

    Ald. Gilbert Villegas (36) attends a City Council meeting in October 2023. [Don Vincent/The Daily Line]

    The mayor and 15 alderpeople are backing legislation (O2024-0007305) that would effectively ban current forms of natural gas energy from being used for heating or appliances in new construction.

    Advocates say it’s a necessary first step, as about 68 percent of Chicago’s greenhouse gas emissions come from the built environment. While having a limited effect on existing buildings, the legislation is seeking to make sure the emissions share doesn’t increase with new developments. 

    But another group representing more than half the City Council is supporting a measure that calls for a cost analysis of the proposal before any decisions are made.

    The Clean and Affordable Buildings Ordinance (CABO) imposes standards that essentially ban the use of natural gas in new buildings and newly built additions. The legislation would also require existing buildings to retrofit their designs to meet the new emissions standards if they construct additions that meet a certain threshold — the greater of 10,000 square feet or 25 percent of the existing floor area. 

    Related: Mayor, alderpeople set to introduce ordinance to effectively ban natural gas energy in new buildings

    Under the proposed ordinance, indoor emissions would be capped at 25 kilograms of carbon dioxide per million British thermal units of energy. The standards would become effective for building permits issued a year after the law is approved.

    The ordinance also includes numerous carve-outs in which the emissions standards can be ignored, such as for commercial kitchen operations, emergency power generation, crematorium operations, commercial laundry operations and hospital and healthcare facility operations. But even in those types of businesses and facilities, the ordinance does not include exceptions for space heating and supplying hot water. 

    “This ordinance is years in the making,” Chief Sustainability Officer Angela Tovar told The Daily Line. “We have actually been talking as the city of Chicago about building decarbonization for quite some time.” 

    The drafting of CABO, including some of the exceptions, was informed by the 2022 recommendations report from the Chicago Building Decarbonization Policy Working Group, Tovar said. She also said community input impacted the ordinance.

    “We really tried to ... put our ears toward community to very intentionally understand what some of those challenges and barriers could be,” Tovar said. “And to design a very reasonable ordinance that has some exceptions and that also leaves the opportunity for emerging clean energy technologies that are zero-low emissions that could come to market in the future.”

    Abe Scarr, director of the Illinois Public Interest Research Group (PIRG), said the legislation is “technology-neutral,” though it purposefully targets current natural gas-burning appliances and heating systems. PIRG is part of the Illinois Clean Jobs Coalition, which is pushing for CABO.

    While Ald. Gilbert Villegas (36) says he supports efforts to reduce Chicago’s emissions, he told The Daily Line he is worried the legislation is being considered without a complete understanding of the resulting costs. 

    “We feel that there hasn't been enough discussion around the financial impacts [on] Chicagoans,” Villegas told The Daily Line. 

    That’s why Villegas filed a resolution (R2024-0007274) calling for an analysis of the costs associated with the proposal and a subsequent hearing. His proposal has 27 co-sponsors so far. 

    The resolution claims that “requiring new buildings to be all-electric will shift the cost of the current natural gas system to older housing stock, much of which is in moderate and low-income neighborhoods, and will result in inequity and injustice to those who can least afford it.” 

    If approved, the resolution would call for Tovar to assemble a working group that includes Peoples Gas, Commonwealth Edison, the Building Owners and Managers Association of Chicago, Chicago Realtors Association, Illinois Restaurant Association, labor organizations and environmental organizations. 

    The working group would “analyze the costs of converting buildings from natural gas to electricity, costs for additional generation capacity needed for future building conversion, and the impacts of shifting costs from new construction to existing buildings if electrification measures are adopted.” The group would present their conclusions during a hearing before the Committee on Environmental Protection and Energy, according to Villegas’ measure. 

    “So that way, both proponents and the opponents are talking and trying to craft an ordinance that gets to a point where we begin to take a look at reducing greenhouse gas emissions and making cleaner buildings,” Villegas said. 

    “I think it's backwards when you introduce an ordinance (first) and have hearings on it,” Villegas said. “The working group should do their work, come back to the body, talk about the findings, talk about ways to move forward and craft an ordinance based on the working group’s recommendation.” 

    Tovar said the city is open to a working group but added, “we don't want to duplicate efforts,” referring to the 2022 decarbonization working group report. “So that would have to be a continued conversation about what that scope of the working group would look like,” she said. 

    Scarr said some studies have shown cost-savings on a long-term basis as a result of decarbonization. 

    A 2021 Citizens Utility Board study and a 2022 NRDC and Energy Futures Group study both showed homeowners could save tens of thousands of dollars over a period of 20 to 30 years as a result of implementing myriad electrification measures. 

    Deputy Chief Sustainability Officer Jared Policicchio also told The Daily Line that savings would come from the consolidation of a separate gas and electric bill into one electric bill. 

    But Villegas also said he believes the Chicago measure, if approved, may not even be legal. He pointed to a recent court ruling that decided a local California measure had improperly usurped federal regulatory authority. 

    In January, a Berkeley, Calif. measure that banned natural gas piping in new buildings was blocked by the U.S. Ninth Circuit Court of Appeals, potentially imperiling similar measures in San Francisco, Los Angeles and other cities both inside and outside California. 

    A three-judge panel of the appeals court previously ruled that Berkeley’s ordinance was preempted by the federal Energy Policy and Conservation Act that prohibits local and state from regulating the “quantity of energy” an appliance consumes. The January request for a rehearing was denied. 

    A New York state law passed in 2023 that phases in prohibitions on fossil fuel equipment and systems in most new buildings is also facing a potential court battle. 

    “Why would we want to subject ourselves to another lawsuit here in the city of Chicago?” Villegas said. 

    While Scarr said he believed CABO would stand up to a lawsuit, Tovar said she did not feel comfortable weighing in on a legal issue. 

    Both Villegas’ resolution and CABO remain in the City Council’s Committee on Committees and Rules.

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