With an eye on its ambitious 2035 carbon neutrality target, 10 years ahead of California’s statewide goal, San Luis Obispo’s City Council passed a new energy policy Tuesday that paves the way for all-electric new buildings.
The council — voting 4-1 with Councilwoman Erica Stewart casting the sole “no” tally — heard from dozens of speakers arguing for and against the new city law.
Mayor Heidi Harmon said that the future of the planet depends on climate action, and SLO’s decision sets a worldwide example, just as its smoking ban in indoor public areas such as bars and restaurants two decades ago has had far-reaching impacts.
“This is a big night for the city of SLO and moving away from fossil fuels in general,” Harmon said. “I’m just really truly appreciating it. The reason we’re in such a jam right now is we have really little time to make this transition. We just have to know that the reason we’re in a bad position is the fossil fuel industry has been misleading us for decades.”
Public speakers included local gas industry workers as well as environmentalists, who spoke passionately on both sides of a policy that will require new types of construction starting in January 2020.
The new law either mandates constructing buildings with all electric power or, alternately, retrofitting gas-powered buildings to electric elsewhere in the city. A third option is to pay an in-lieu fee in the thousands of dollars to help fund retrofits elsewhere in the city that transition from gas to electric.
About 40 percent of the city’s total carbon emissions currently come from use of natural gas generated from buildings, according to city officials.
And SLO is transitioning into using carbon free, renewable energy sources to supply electricity for the city. SLO joined the Monterey Bay Community Power community choice energy program, which begins serving city customers in 2020.
A controversial issue
Stewart said she agrees with the vision for climate action, but argued the city should offer more building incentives to help bring down costs to construct new homes. Stewart said affordability for homebuyers and renters needs to be at the forefront of the conversation.
City staff members, however, contended the cost to build all electric homes will be comparable to or less than homes using gas energy.
The decision came after about four hours of council discussion, including public comment from dozens of speakers.
Several workers from the Southern California Gas Company expressed concerns, saying the policy change would limit energy choice, cost more and potentially be a slippery slope to require all buildings in SLO to convert to electric.
Some people said they’d prefer to cook with a gas stove versus electric and worry about the stress of a potentially higher utility bill.
“Personally I would never buy an all-electric home,” said Richard Reyes, a SoCal gas employee. “Most people don’t know about (the city’s planned transition to electric) and when they find out, they aren’t happy about it.”
But climate action activists celebrated the decision as a bold step forward.
“There are tremendous benefits of moving all zero-pollution buildings and tonight, the council made the clear-sighted and prudent decision to prepare our city for a carbon-free future,” said Eric Veium, chair of the SLO Climate Coalition.
Carbon neutrality refers to the concept of reducing carbon emissions to the point where emissions are balanced out by savings through a variety of resource approaches, helping to reduce the impacts of climate change.
A transition from gas to electric hookups
The city projects more than 4,600 new homes planned for the city and more than 5 million square feet of nonresidential building units by 2035, which will be incentivized to electrify through the impending new law.
Development agreements between the city and Avila Ranch and SLO and San Luis Ranch included a provision that those incoming projects totaling 1,300 homes complying with greenhouse gas reduction policies that are citywide, such as the one passed Tuesday.
The in-lieu fee would range from $6,013 for a typical single-family residence up to $88,549 for a large office of 54,000 square feet, the staff report stated.
Avila Ranch’s builder representative, Carol Florence, said her client Wathon Castanos Homes is learning more about the costs and design aspects of constructing all electric, saying the company is committed to the idea of all-electric, but will also need to analyze expense and strive remain affordable at the same same, leaving the door open to possibly pay in-lieu fees.
Even new SLO buildings that are gas powered still would have to wire the units to allow for a smooth transition to electric in the future.
SLO officials cited multiple job-related programs, run by outside organizations, available to workers who wish to explore new options.
“We’re deeply committed to a just transition to a carbon free economy,” Veium said in public comment. “This applies to those whose lives and livelihoods are currently dependent on the fossil fuel economy.”
Veium invited those who work in gas to meet with the SLO Climate Coalition about transitioning to clean energy jobs.
Urgency for climate action spurred decision
SLO council members first broached the electrification idea two years ago, directing city staff to draft a code change to “avoid generating new greenhouse gas emissions as the result of energy use in new buildings.”
The decision is in line with energy changes that more than 50 California cities are pursuing to reduce carbon emissions, according to city officials.
Berkeley has banned the use of natural gas. But cities such as San Francisco, Burlingame, Santa Monica and Morgan Hill are pursuing ordinances that encourage all-electric buildings in a manner similar to SLO’s.
“Due to decades of rapidly increasing global greenhouse gas (GHG) emissions and insufficient climate action at all levels of government, atmospheric GHG concentrations have reached a level that guarantees substantial and unavoidable impacts for the foreseeable future,” the city wrote in a staff report.
At an August forum hosted by the SLO Climate Coalition, PG&E representative Hannah Kaye said the company encourages policies promoting electric construction as long as they are cost effective, adding they won’t “crash the grid.”
Chris Read, SLO’s sustainability manager, said that new high efficiency electric appliances are effective and affordable, such as induction cooktops and heat pumps.
“Many people have in mind the old coil cooktop that everyone hates and many people think about the resistance heaters that everyone hates,” Ready said. “Just to be clear, that’s not how people would comply with the energy code in 2019.”
Utility bills are expected to go up $5 to $15 per month in an all electric household, though those expenses could be reduced with use of solar panels, which will become law to add to new homes in 2020 in California. And rate reduction programs would be available to low income residents.
Multiple voices chime in
Multiple city residents wrote into the city in advance of the meeting.
“I believe that this policy change will support both local and state goals toward carbon reduction and create opportunities for a more broad system change,” said Kris Roudebush, a SLO resident, in a letter to the city. “This policy change is one step towards a greater goal and sets the bar for best practices in an environmentally conscious community.”
But SLO resident Richard Schmidt argued that the city is limiting choice, and locking the policy in without flexibility for adaption, contending the phasing out of gas means “there will be no hookups, no mains, no availability today or tomorrow.”
“How do you know that’s a good idea?” Schmidt said. “What if tomorrow’s dream green tech needs gas, say for hydrogen fuel cell deployment, or some other tech we cannot imagine today? What if gas companies can develop a non-polluting ‘gas’ that can use those pipes?”
Schmidt added “the problem is we’re building too many crappy buildings.” Schmidt encourages low-energy, sustainable architecture with significant natural lighting.
The SLO Chamber of Commerce also weighed in, making several suggestions about the direction forward.
The Chamber called for incentives for developers to go all-electric, including “up-zoning, reduced minimum parking standards, reduced electricity rates through Monterey Bay Community Power and a meaningful, guaranteed fast-track through the permitting process.”
Councilwoman Andy Pease said that land use change regarding incentives should be separate from energy decisions.
The Sierra Club weighed in after Tuesday’s decision by saying that it hopes other communities will be inspired to follow the action.
“San Luis Obispo’s forward looking ordinance is both an ambitious local policy and a piece of a broader statewide effort to move towards a clean, renewable energy future,” said Sierra Club Senior Campaign Representative Matt Gough in a statement. “We applaud San Luis Obispo’s leadership and look forward to what it and other cities across the state will accomplish next.”