Unrelenting gas industry keeps pouring fuel on the fire: FortisBC refuses to take no for an answer

[The following originally appeared as a two-part series in Canada’s National Observer here.]

There is a universe in which the so-called “natural” gas industry reinvents itself, gracefully transitioning to alternative forms of genuinely renewable energy, aiding in our shared need to rapidly reduce emissions and supporting worker transition for the future.

Sadly, that does not appear to be the universe in which we live.

Instead, Canada’s main residential suppliers of fossil gas remain unrelenting in their bloody-nailed determination to expand our reliance on their planet-burning, climate chaos-inducing product.

In British Columbia, where I reside, the residential gas supplier is FortisBC, a private monopoly that simply refuses to take no for an answer. Across the province, over two dozen municipalities (including some of our largest) have passed policies that prohibit the use of gas heating in new buildings. The B.C. government’s target date for a similar province-wide policy isn’t until 2030, but it has encouraged municipal governments to move sooner.

FortisBC, however, is pushing back – sometimes directly and sometimes by proxy. Let’s dig in. 

Vancouver rolls over to gas lobby

Over the past few years, in hundreds of talks across the country, I have told the story of the City of Vancouver’s decision to prohibit new buildings from using fossil fuels for heating. In a bylaw dating from 2020 (and in effect since January 2022), this bold policy stood out as an early beacon of genuine climate emergency action, given that gas burned in buildings currently accounts for 55 percent of Vancouver’s greenhouse gas emissions. (And full disclosure, the Vancouver city councillor who championed this move, Christine Boyle, is my wife.) Vancouver led the country in getting new buildings off of gas, with a clear plan that created certainty for builders without adding costs for residents, and dozens of other municipalities were inspired to follow suit.

The gas industry, however, has been plotting a reversal ever since. And last week, it successfully got the Vancouver policy overturned. Poorly timed, the about-face came the same week the world recorded its hottest days ever and a third of Jasper burned to the ground.

Normally, changes in policy such as this would come in the form of a motion, tabled with at least a week’s notice, giving members of the public a chance to voice their opinion, speak before council, and marshal expert feedback, ensuring such a big decision be made based on credible information and transparent dialogue. Not this time. Instead, ABC Councillor Brian Montague (who had recently met with a FortisBC lobbyist), in a particularly cowardly manner, tabled a surprise late-in-the-day amendment to a staff report (ironically, a progress report on the city’s climate plan, which highlighted that the city was behind in hitting its GHG reduction targets). The amendment reverses the city’s prohibition on gas in new buildings and gives staff until November 1 to come back with new bylaw language that would pave the way for the return of this fossil fuel.

(Incidentally, Councillor Montague, who actually lives outside Vancouver, has not been particularly active on council. This past week also saw him introduce his first-ever motion – paradoxically a move to “review” and possibly abolish the city’s Integrity Commissioner.)

With no one except his fellow ABC councillors (the right-wing majority) knowing this abrupt move was coming, the public wasn’t able to weigh in, nor did staff or outside experts have an opportunity to offer evidence or insights. The vote was nevertheless very close: 6-5. The three opposition councillors voted against the policy reversal (Green Councillors Adriane Carr and Pete Fry, and OneCity Councillor Boyle) and, to their credit, two ABC councillors, Lisa Dominato and Peter Meiszner, broke ranks with their party to vote no. This forced Mayor Ken Sim to Zoom in from holiday in Europe to cast the tie-breaking vote in favour.

Tellingly, the mayor’s office already had a news release ready to go that evening, with third-party validation lined up from the Homebuilders Association Vancouver and the Greater Vancouver Board of Trade. FortisBC itself has done its best to stay quiet, although it has a rep on the board of the Homebuilders Association. On July 26, in a call to FortisBC, I asked a media relations officer for information on the corporation’s lobbying efforts with city councillors and whether Fortis provides funding for industry front groups such as Voice of Energy and the BC Coalition for Affordable and Dependable Energy, but I await a reply. 

The core arguments made by Councillor Montague and in the mayor’s press release mirror FortisBC talking points: allowing gas will make homes “more affordable”, speed up construction, restore “choice”, and improve “reliability.” With no hint of irony, Councillor Montague claimed that, “As climate change leads to more severe weather events, having multiple energy options is crucial.” The mayor hailed the amendment as, “a pivotal moment in Vancouver's journey towards a sustainable future.” 

Every one of these arguments could have been easily debunked, if the ABC council had the courage to allow experts to respond. In a CBC interview in the wake of Vancouver’s vote, Mark Jaccard, chair and CEO of the BC Utilities Commission, disputed the claim that electric power was unreliable. As CNO’s Marc Fawcett-Atkinson has written, “Several analyses – including from B.C. Hydro, B.C. Housing and Clean Energy Canada – say installing electric heating systems like heat pumps in new buildings typically costs the same amount as using gas, or less.”  The Pembina Institute noted in its response to last week’s news, “According to case studies from the Zero Emissions Innovation Centre (ZEIC), zero-emissions buildings can achieve cost parity with gas-fired buildings. Forgoing gas infrastructure [also] simplifies design and construction, which can reduce costs.”

My own revelatory moment on this question came about a year ago, when I asked a senior person with one of Vancouver’s big real estate development companies if building all-electric is more expensive. He laughed and replied, "We live in a capitalist market economy. The cost of a new home is whatever a developer can get in this market. Marginal input costs like this are irrelevant."

During last week’s council meeting, city staff also took issue with the up-front cost claims made by the mayor, and additionally noted that new home buyers would face increased retrofit costs down the road. They cautioned this policy flip-flop risked causing upheaval and confusion in the industry. Most importantly, they warned the move would take the city backward on meeting its climate goals. But the majority of councillors seemed uninterested. “Look,” Mayor Sim said, “we all love the environment… But we need balance.”

The amendment language highlights the purported “rapid decarbonization of BC’s gas system such as provincially-stated RNG percentage targets (15% by 2030),” even though FortisBC itself has recently noted that, currently, only one percent of its supply constitutes renewable natural gas. At this rate, I’d say the plan isn’t going well.

Ignored by the city’s reversal is the growing issue of safety as the world heats up. Electric heat pumps also provide cooling in the face of extreme heat events and help filter out smoky air when wildfires are rampant, something natural gas heating does not.

But none of that matters – this was Mayor Sim and a majority of his councillors merely doing the gas industry’s bidding. 

What happened last week in Vancouver is also a warning of what will happen province-wide or nation-wide if ABC’s Conservative allies are elected in sufficient numbers to form government –– every meaningful climate policy won in recent years will be subject to reversal. It should go without saying that we can’t afford to have that happen.

The concerted push-back from the gas lobby, however, goes well beyond Vancouver.

FortisBC determined to keep hooking up new homes, and the enticements keep on coming

FortisBC’s business model, simply put, requires tying-in new buildings to the gas network. And the corporation is bound and determined to keep doing just that.

In 2023, FortisBC grew their net residential customer base by an additional 9,664 homes (a slightly smaller increase than the last few years, when the annual growth had exceeded 10,000). According to documents I requested from B.C.’s Ministry for Energy, Mines and Low-Carbon Innovation, this is very similar to the number of households claiming government rebates to convert to an electric heat pump system, which clocked in at 9,586 homes for the fiscal year ending in March 2024.

It is worrying that Fortis keeps hooking up new customers at the same rate as existing ones switch to electric heat pumps. A trend of one-in-one-out makes it virtually impossible for the province to hit its GHG reduction targets for buildings; the math simply doesn’t work. On the other hand, this is a good news development from a year earlier, when FortisBC was gaining new customers at twice the rate that existing users were fuel-swapping and claiming the government heat pump rebate. The province has been managing to successfully grow its rebate program and get more homes using climate-friendly heat pumps.

But Fortis isn’t throwing in the towel.

For years, FortisBC ran a program that offered generous rebates for people purchasing new gas appliances and furnaces. This subsidy was only possible by forcing existing gas customers to pay for the corporation’s enticements to retain and secure new customers. Thankfully, however, as of January of this year (and after a lengthy delay), the provincial regulator finally disallowed FortisBC from engaging in this practice.

Yet now, ever inventive, FortisBC has found a work-around. They have just started offering mammoth rebates of $10,000 for customers who purchase dual-system electric heat pumps with gas back-up. Apparently, these rebates are still permitted. An argument can be made for hybrid units such as these in particularly cold regions, but not in the temperate south-west of B.C. where most of the population resides. More to the point, at $10,000, these new rebates will actually encourage consumers to use dual gas-electric systems, even when that’s not warranted. In combination with the government’s heat pump rebates, these new Fortis ones pretty much cover the full cost of conversion – insidiously, they make it uneconomic not to stay hooked up to the gas network.

The cost of this new offering could be astronomical – if 10,000 households a year were to claim this new rebate (a modest projection given that B.C. builds about 50,000 new homes a year), the program would cost $100 million annually. That cost would again have to be subsidized by existing customers through their monthly gas bills. Good grounds for the provincial regulator of this private monopoly to disallow this new rebate.

A bridge too far?

These efforts to block the electrification of buildings aren’t unique to B.C., of course, nor are they new. Enbridge, the main supplier of fossil gas in central Canada, keeps doing everything in its power to tie-in new homes to gas lines, in their case with the active cooperation of the Ford government in Ontario.

And just last week in Washington State, after spending millions of dollars, the gas industry and its allies managed to get a ballot initiative certified that, if successful in November, would roll back that state’s nation-leading all-electric building code.

It is, unquestionably, deeply demoralizing – and such a terrible waste of time and effort – to have to keep re-prosecuting these fights.

But, just maybe, FortisBC and its industry allies have overplayed their hand. For years, the provincial government has not wished to lead on this fight, preferring to let municipalities decide which of them wishes to expedite the transition to all-electric new homes and buildings. Surely the gas industry has now made clear that this is a path to hell, where those municipalities that chose to move on this matter will be relentlessly hounded by the proxies of the gas companies, before and after they take decisive action, even as so many communities are living through the horrifyingly real impacts of the climate crisis each year. The provincial government simply needs to make the prohibition of gas in new homes the law of the land.