Who Owns a Utility Matters Less for Climate Than the Rules They Play By

Cascadia’s transition to safe, healthy, gas-free homes and businesses is not moving quickly enough, and the region’s gas utilities bear much of the blame. 

Consider a few recent examples: In 2022 Oregon’s gas utilities sued the state over its landmark Climate Protection Program, setting back implementation by at least a year. In 2023 NW Natural funded a campaign in Eugene, Oregon, to repeal the city’s ban on gas hookups in new residential buildings. In 2024 Cascade Natural Gas and NW Natural supported ballot initiative 2066 to keep Washington state hooked on gas, including by restricting the state’s ability to incentivize electric heat pumps in new construction. The measure may now be headed to the state supreme court, after voters narrowly approved it and then the King County Superior Court overturned it. 

Allowing gas utilities to explore new climate-friendly business models such as thermal energy networks (TENs) could soften their stance on decarbonization. But here, too, momentum has been halting. An Oregon bill to establish TENs pilot projects stalled in the Joint Ways and Means committee this year. 

The gas sector’s slow-walk on climate progress demands more transformative ideas. One that surfaces from time to time among advocates is transferring gas utilities to public ownership. It’s a common model in Cascadia for electric utilities, and one that could theoretically speed electrification by removing utilities’ profit motive and making companies more accountable to the public. 

What we found, though, is that publicly owned gas utilities in the United States aren’t moving faster toward decarbonization than their privately owned counterparts. That’s likely because they face many of the same misaligned incentives and lax climate policies as their for-profit counterparts. In much of Cascadia, too, public gas utilities (there are a few) do not serve customers that want to shut them down. That’s to say nothing of the practical and financial challenges of transferring aging fossil fuel infrastructure to government ownership 

The good news, though, is that both those ingredients—the policy context in which they operate and the desires of the public they serve—can change, and they don’t depend on first altering gas utility ownership structure. A slew of effective policies is already at work and available to copy-paste from more climate-forward places, namely the Netherlands and Denmark. Those countries do own their gas utilities, but that’s not a prerequisite when it comes to decarbonization. Rather, it’s their exceptionally strong gas transition policies that can apply to any type of utility, including the investor-owned companies prevalent in Cascadia today.  

The takeaway: Cascadians can spare themselves the immensely challenging campaign of trying to take over the region’s investor-owned companies and instead focus on pushing the measures that are already succeeding elsewhere. Which of course means a faster path off gas and toward the cleaner, healthier homes and businesses.  

The ideas behind public utility ownership: Lower rates, cleaner energy, and local control 

Government ownership of utilities is nothing new to Cascadia. More than 110 publicly owned electric utilities dot the region, ranging from the tiny City of Rupert Electric in Idaho, with 3,200 customers, to the gargantuan HydroBC in British Columbia, which serves more than 2.2 million customers (95 percent of provincial residents). Customers of publicly owned electric utilities in the United States tend to enjoy lower rates and more reliable electricity than customers of other types of utilities, according to US Energy Information Agency data analyzed by the American Public Power Association.  

For these reasons and more, community members and activists have pushed for public takeover of privately owned electric companies in the Northwest and beyond. Cascadia added two publicly owned electric utilities in the past 25 years: Jefferson County Public Utility District, which split from Puget Sound Energy (PSE) in 2008, in northwest Washington, and Hermiston Energy Services, which split from PacifiCorp in 2001, in northeast Oregon. 

Both communities voted to acquire their local electric facilities, having grown frustrated with a degradation of customer service and high rates from the investor-owned utilities (IOUs) serving them. Jefferson County residents also wanted to acquire energy from cleaner sources than the incumbent, PSE, provided. Customers of the public utilities now pay rates 10 to 34 percent lower than those the private companies charge, as shown in the chart below.   

Environmental activists in the Hudson Valley region of New York; Maine; and San Diego, California, have recently staged high-profile campaigns to acquire the private utilities serving their communities, seeking cleaner energy at more affordable prices. The New York bill, which lawmakers reintroduced in 2025, would assume ownership of a combination gas-and-electric utility and require the new public power authority to conduct a study “to create a timeline for the potential phaseout of its gas infrastructure.” (Sightline is not aware of any campaigns to municipalize a gas-only utility.) 

However, none of these movements has yet succeeded. Maine voters rejected the ballot initiative after the utility-funded opposition campaign spent millions lobbying against it and the governor vocally opposed it. The San Diego city council unanimously voted against placing the public power initiative on the ballot, citing concerns about the proposal’s financial and operational aspects. And New York lawmakers have not advanced the Hudson Valley proposal, in part due to opposition from the principal electrical workers’ union.  

Organizers and advocates in Cascadia should anticipate that any effort to municipalize a gas utility would likely face the same concerted opposition and uphill political battles.   

US public gas utilities hold spotty climate track records 

In contrast to its plethora of publicly owned electric utilities, Cascadia counts only three small publicly owned gas utilities. These three public gas companies serve just 0.3 percent of the households that burn gas in the region, or just about 13,000 customers of the 4.3 million gas customers throughout Alaska, British Columbia, Idaho, Montana, Oregon, and Washington. The rest of the region is served by investor-owned and cooperative gas utilities or does not use gas.¹ These three utilities formed when communities wanted gas connections but couldn’t attract IOUs to extend a pipeline to them. (Sightline has searched but has not found any communities in the United States that have municipalized a private gas utility in recent history.) 

Despite public oversight, these community-owned companies are dragging their feet on decarbonization just as much as their privately owned, for-profit counterparts. 

Of the three publicly owned gas utilities in Cascadia, only one—the City of Ellensburg, Washington, which serves about 5,000 customers—has plans to decarbonize, and at present, they’re still just that: plans. In its Sustainability and Energy Plan, the city outlines potential actions to support building electrification and discourage gas use, including revising gas line extension policies, incentivizing customers to switch from gas to electric appliances, and halting gas system expansion. Ellensburg also owns its electric utility, which could allow the city to offset gas revenue losses as customers electrify. However, the city has not implemented any of these strategies, nor is it considering winding down the gas utility, according to a spokesperson Sightline interviewed. 

Meanwhile, neither of Cascadia’s other two public gas utilities has indicated any intention of decarbonizing, let alone announced plans to do so. The City of Enumclaw’s gas utility, which also serves around 5,000 customers, plans to comply with Washington’s Climate Commitment Act by buying carbon allowances, natural gas manager Nick Peelo told Sightline. The utility does not offer energy efficiency or electrification programs to support customers in lowering their emissions or saving money.  

Alaska’s publicly owned gas utility, Interior Gas Utility in Fairbanks’s North Star borough, which serves about 3,000 customers, is expanding, bolstered by the community’s Climate Action and Adaptation Plan that encourages the use of natural gas to transition away from the locally prevalent coal and home heating oil. Alaska’s lack of state-level emissions limits or pollution fees means Interior Gas feels no regulatory pressure to change. 

Outside Cascadia, Philadelphia Gas Works (PGW) is the largest municipal gas utility in the United States, serving about 500,000 customers. While neither Pennsylvania nor Philadelphia has enacted binding emissions laws, both have pledged to reach net-zero by 2050, a goal that includes moving buildings and industries off gas and onto electricity. Achieving this goal would shrink the state’s residential gas customer base by 40 percent. 

Again, though, a plan without action is just that. PGW hasn’t taken any steps to support customer electrification, let alone planned for eventual pipeline retirements. In a recent PGW report, the company assumed that it would fully maintain its entire pipeline footprint—even if many customers electrify—reflecting the inertia that public ownership alone does not overcome.  

In the past decade, at least one large Washington city briefly explored the legality of acquiring the local gas distribution infrastructure but chose not to move forward, according to a city official with whom Sightline spoke off the record. The city’s legal staff cautioned that acquiring a gas utility solely to wind it down could raise constitutional concerns under the state’s prohibition of gifts of public funds. Buying a gas utility and then closing it would destroy the investment’s value to taxpayers and essentially buy out the utility’s investor owners.  

Crucially, the city recognized that Washington’s “obligation to serve” law would limit its ability to wind down gas infrastructure, just as this statute has hindered IOUs’ ability to systematically prune their pipeline systems. In other words, they’re legally bound to the energy system of the past. 

Public gas utilities elsewhere are decarbonizing, thanks to strong policy support 

If publicly owned utilities are getting harder to establish, and those that do exist aren’t making any moves to shift off gas anyway, what’s left? How can a place whose people have voted time and again for cleaner, healthier energy options and pro-climate and -environment measures push their utilities for meaningful change?  

Examples from both Denmark and the Netherlands, which have been pursuing gas system decarbonization in ways large and small over the last decade-plus, can help show the way. These countries’ gas utilities are government-owned. But the policies that direct their climate-forward operations are very much possible today in Cascadia, even without embarking on a difficult campaign of public ownership.  

Since 2016, Denmark has banned gas service in areas served by district heating, which serves 70 percent of households. Municipalities can require buildings to connect to these systems. In 2013 Denmark also banned fossil-fuel boilers in new buildings. And buildings undergoing renovation must transition to renewable heating sources, unless doing so is technically or economically infeasible. 

In 2022 the Danish government tasked Evida, a publicly owned gas distribution utility, with studying where continued operation of the gas network is economically unviable. The utility found that 28 percent of pipeline segments were operating at a loss. In response, the government authorized Evida to charge exit fees to help fund gas system decommissioning, with subsidized fees for low-income or energy-inefficient households. 

Denmark intends to wind down residential gas use by 2030. Of the roughly 400,000 Danish homes heated with gas today, half will switch to district heating by 2028, and the rest will convert to electric heat pumps by 2030. 

The Netherlands, with its six publicly owned gas distribution utilities, also plans to stop burning gas for heating—no easy feat for a country with around 90 percent of its 8 million households connected to the gas network. 

The Netherlands’ binding National Climate Agreement calls for phasing out gas in buildings by 2050. According to the agreement, 1.5 million of the 8 million gas-heated homes must stop burning gas for heat by 2030. To meet that target, the government passed a suite of policies in 2024: ending the utilities’ obligation to serve new gas customers, banning gas hookups in new construction, requiring municipalities to create neighborhood-level gas transition plans, and allowing utilities to accelerate depreciation of assets to reduce stranded costs. The government also compensates utilities for pipeline decommissioning and user disconnections.  

Carbon taxes on the emissions from natural gas, which make burning gas ever more expensive, underpin both the Netherlands’ and Denmark’s gas decarbonization efforts. 

The path ahead for Cascadia: Proven policies, public buy-in 

Cascadia’s state and local governments have barely begun enacting the policies Denmark and the Netherlands are charging ahead with. For example, an early version of Washington’s House Bill 1589 would have ended PSE’s obligation to serve new gas customers, but that provision didn’t survive the final law.  

Table 1 below summarizes the status of Denmark and the Netherlands’ gas transition policies in British Columbia, Oregon, and Washington. (The rest of Cascadia has not begun to transition away from gas, so is excluded from the table.) The table omits carbon pricing policies, since these are economy-wide measures. 

One way in which public ownership might in fact speed decarbonization is by stifling some of the utility resistance to progress that is rampant in the Northwest. Indeed, Denmark’s gas distribution utility is supporting municipal planning efforts to phase out gas. Dutch gas distribution utilities provide open data and models to accelerate the energy transition. A trade consortium for the Dutch gas (and electric) utilities posits electrification as the “engine of the energy transition.”  

But it is doubtful that publicly owned gas utilities would participate as willingly in the energy transition in Cascadia as those in northern Europe, at least in the immediate term, even if cities overcame the financial and logistical hurdles to municipalizing the companies. Both Denmark and the Netherlands enjoy broad public support for their plans to wind down the gas network. In one Dutch district, Overvecht-Noord, citizens voted 92 percent in favor of forced gas disconnections. A 2022 survey found that a majority of Danes support a carbon tax that would raise the price of heating homes with gas as part of a larger strategy to combat climate change. 

By contrast, here in Cascadia, even with a broad pro-climate ethos relative to the rest of the US and Canada, a majority of voters may not yet specifically support winding down the gas system. The narrow approval by voters of Washington’s initiative 2066, which repealed policies to support cleaner, non-gas options in homes and businesses, gestures at this hesitation. More broadly, a 2023 poll shows nearly three-quarters of Americans hold favorable views of natural gas (though that figure drops to 27 percent when it’s called “methane gas”). 

And yet…that Washington initiative didn’t pass by much, surely helped by misleading claims and confusing language. On that very same ballot, Washingtonians overwhelmingly supported keeping their Climate Commitment Act. Oregonians, meanwhile, have protested their largest gas utility, NW Natural, for years now, for blocking city-level measures to reduce gas in new construction, mixing hydrogen into home heating fuels without informing customers, and propagating disinformation about climate change. And in British Columbia, Vancouverites successfully protested a proposal by their city council to backtrack on requiring all-electric new homes.  

So, hope is not lost—to build public understanding and support and to pass the policies needed to get Cascadia beyond gas. We’re just behind, which means we can take notes from lessons learned by places that are ahead. And when it comes to shifting utilities toward electrification, what’s likely to make the biggest difference isn’t who owns them but what’s demanded of them. That is, whether leaders are willing to stand up to the gas industry, and with robust community backing, to build the energy system Cascadians deserve.