By Patrick M. Davis, The Austin Free Press
On July 23, Austin’s Audit and Finance Committee is scheduled to vote on a key resolution that aims to lower natural gas rates – especially for low-income customers – and mitigate the fossil fuel’s environmental and health effects.
The resolution would expand the city’s oversight of Texas Gas Service, which provides natural gas to 95 percent of the Austin residents who use gas to power their appliances or homes. Texas Gas Service is pushing back against this bold move by local consumer and environmental watchdogs.
If the Audit and Finance Committee approves the resolution, it then goes to the full city council for consideration, where it could face additional political hurdles, given the industry’s powerful influence in the Texas Capitol.
The move to expand Austin’s oversight of gas utilities gained momentum last month when the city’s Resource Management Commission passed a resolution to include gas utilities as part of its advisory responsibilities. The commission already advises the Austin City Council on its Austin Energy and Austin Water utilities. It makes recommendations promoting renewable energy, progressive rate structures, and low-income weatherization programs. The City of Austin owns both of those utilities. No commission, however, currently advises city council on policies regarding Texas Gas, a private, publicly traded company.
Eco-warrior
According to Paul Robbins, the resolution’s author and the commission’s vice chair, a lack of oversight has allowed Texas Gas to sidestep accountability to its customers and the environment.
“If we’re going to have a gas utility, it needs to be a fair one,” Robbins told Austin Free Press. “We need to have rates that we can live with, we need to help the poor, and we need to have real conservation programs.”
The author and publisher of the Austin Environmental Directory, Robbins needs no introduction at City Hall. Recognizing his relentless work advocating more environmental responsibility, the city named an eco-friendly downtown chilling plant after Robbins in 2007. “Clad in his signature tweed blazer, penny loafers, and magnifying-glass-like spectacles,” the Austin Chronicle reported at the time, “Robbins is the rail-thin gent with longish gray hair who’s often tersely addressing council during citizens’ communication, skewering the city over an energy-related misgiving or calling for far-reaching reforms.”
Texas Gas Service officials said additional oversight is not warranted given the company’s efficient, transparent, and reliable service. The utility’s gas continued to flow during Winter Storms Gerri and Uri, when large swaths of the electric grid went dark, spokesperson Jason Cleary noted in an email to Austin Free Press.
“We are regulated by both the City and the Texas Railroad Commission,” he said, which review “all our rates and customer programs.”
In addition to serving Austin, Texas Gas Service provides natural gas to customers in many communities around the state. In Central Texas, that includes Bastrop, Bee Cave, Buda, Cedar Park, Dripping Springs, Hutto, Kyle, Lakeway, Pflugerville, Rollingwood, Sunset Valley and West Lake Hills.
Gas bills
Robbins wants the city council to solicit bids from other natural gas providers before the city’s Texas Gas franchise agreement expires in 2026. The Resource Management Commission resolution states that inflation-adjusted Texas Gas rates for Austin customers have doubled since 2008. Robbins said the utility should reform how it calculates those rates.
Under “progressive” rate structures at Austin Energy and Austin Water, the more electricity or water that customers use, the more they pay per unit. This structure aims to reward conservation and it benefits low-income customers, who tend to use fewer resources. By contrast, Robbins said Texas Gas uses a “regressive” rate structure that charges customers the same price per unit regardless of how much gas they burn. That does not incentivize conservation, he said.
The Resource Management Commission resolution also calls for better assistance to low-income customers. Texas Gas contributes about $100,000 a year to a “Share the Warmth” assistance program and encourages customers to contribute to it when they pay their gas bill, according to the resolution. This is a fraction of what Austin Energy and Austin Water pour into their assistance programs. Last year their combined assistance budget approached $19 million.
Gas emissions
A Texas Gas Service report says that it issued more than 30,000 rebates last year to customers who installed energy-efficient appliances worth a projected savings of $1,700,000. Texas Gas said the rebates helped customers conserve energy and save money. “Our energy efficiency programs are cost-effective and validated by third-party research,” company spokesperson Jason Cleary wrote.
Robbins said that the gas utility spends too much on these rebates in exchange for negligible energy savings, thereby driving up everyone’s gas rates.
Critics also have concerns with how Texas Gas calculates the emissions savings of its rebate program. The utility said its rebates led to an expected reduction of 45,593 tons of carbon dioxide emissions in 2023. That’s comparable to taking more than 10,000 cars off the road. But Kaiba White, a Climate Policy Specialist for Public Citizen’s Texas Office, said Texas Gas based that figure on “creative math.”
Real emissions cuts happen, she said, when customers replace old, inefficient appliances with more efficient ones. Yet she said that the utility misleadingly claims emissions reductions when customers buy new appliances for a new home or replace an electric clothes dryer with a gas one.
Austin’s Climate Equity Plan aims to eliminate fossil fuels by 2040. The Resource Management Commission resolution does not advocate turning off natural gas spigots now. Yet some Austinites already are abandoning gas for climate and health reasons. “I personally switched from a natural gas stove to an induction electric stove because I had a kid and was especially concerned about my child’s health,” Kaiba White said.
Research shows that natural gas stoves emit toxic gases. These include the carcinogen benzene, as well as nitrogen oxide, which is linked to increased rates of child asthma.
Natural gas also damages the broader environment and climate. While the industry says that burning gas emits far less carbon dioxide than burning coal or petroleum, White said that isn’t the full picture. Many fracked natural gas wells consume and pollute huge amounts of water. Natural gas pipelines, wells, and storage tanks also emit huge amounts of methane, a gas that White described as “a huge driver of the climate crisis.”
“Some of the most egregious climate impact from natural gas is often left invisible in climate-carbon accounting,” she said.
White said that increasing Texas Gas Service oversight would give city council “more sets of eyes on an important franchise that affects city customers.”