The city of Berkeley spent nearly $300,000 defending its now-defunct ban on new natural gas infrastructure from a lawsuit by a restaurant trade group, Berkeleyside has learned.
Berkeley was the first U.S. city to prohibit natural gas infrastructure in new buildings when it did so in July 2019 to combat climate change by reducing greenhouse gasses and to improve indoor and outdoor air quality.
It was quickly contested by the California Restaurant Association, which filed a lawsuit accusing the city of overstepping its authority by imposing the ban, and saying that its members were prevented from opening viable commercial kitchens with gas stoves as a result.
In January, after the 9th U.S. Circuit Court of Appeals ruling in favor of the restaurant trade group was upheld, the city agreed to stop enforcing the ban until it formally removes the ordinance from its municipal code within a period of six months.
“With very few options left, Berkeley has ceased enforcing the natural gas ban and will take steps to repeal it,” Mayor Jesse Arreguín told Berkeleyside in an email.
The city plans to keep exploring other policymaking avenues for climate action, he added, and “neither a well-funded fossil fuel lobby nor the disappointment from these court rulings will stop Berkeley from being a leader in climate action.”
In fighting the measure, the city spent $283,092 on outside counsel, not including its own staff time, since the inception of the lawsuit in November 2019, Deputy City Attorney Lauren Packard wrote in an email.
To put it into context, that amount is roughly equivalent to 3% of the City Attorney’s Office’s anticipated expenditures for the 2024 fiscal year, which, according to the city’s latest budget update, is $8.1 million.
When crafting the ordinance, which garnered national attention but was based on a legal premise that did not hold up in court, Berkeley sought to avoid the federal Energy Policy and Conservation Act, or EPCA, which gives the U.S. Department of Energy the ability to set energy efficiency standards for common household appliances including stoves. Instead of banning gas appliances outright, the city instead banned the installation of gas hookups in new construction, casting the measure as an update to its building codes.
Packard told Berkeleyside that prior to the 9th Circuit’s ruling, the city had “no notion” that gas pipes were included in the scope of the EPCA.
The ordinance, authored by former Councilmember Kate Harrison, was meant to help address the climate crisis by mandating all-electric power in new buildings, thereby reducing the use of natural gas, which contains methane, a strong greenhouse gas.
The California Restaurant Association suit, filed in November 2019, accused the city for overstepping its authority by passing a municipal ordinance that conflicts with federal law and harming its members. In 2021, a federal district court dismissed the lawsuit, but the restaurant association appealed and had that decision reversed.
Last year, a three-judge panel of the 9th Circuit Court of Appeals ruled in the restaurant association’s favor, finding that the scope of the EPCA goes beyond just the regulation of natural gas devices — it also encompasses the building codes that regulate natural gas use.
Berkeley petitioned for a rehearing the following month, but the court denied the request. The city’s planning department, responsible for reviewing all new construction projects, said it stopped enforcing the ordinance on January 10 to comply with the 9th Circuit’s ruling.
With the settlement agreement signed on March 21, the legal battle over the gas ban ended.
The California Restaurant Association hailed the city’s decision to take steps to repeal its gas ban ordinance as a major victory. “Every city and county in California that has passed a similar ordinance should follow their lead,” it wrote in a press release.
Bentham Paulos, a former commissioner of the Berkeley Energy Commission, decried the restaurant association’s lawsuit, but said that Berkeley could still serve as an example to other municipalities of policies that can help cut emissions and reduce global-warming pollution.
“Just cutting emissions in Berkeley is not going to make a big difference in the world,” he said. “But if we can innovate some new strategies and new approaches and then have other people copy them, we can have a bigger impact.”
Indeed, since 2019, more than 70 cities in California, including San Francisco, Los Angeles and San Jose, passed new building ordinances modeled after Berkeley’s. It’s unclear how many will repeal their gas bans to avoid facing similar lawsuits. San Francisco officials have said that the city will continue enforcing its gas ban, KQED reported. Ojai’s city council, meanwhile, has pledged to “improve” its ban on gas infrastructure after a resident threatened to file suit over it, as reported by Ojai Valley News.
Paulos remains optimistic about the future of the “electrify everything” movement that the Berkeley gas ban helped propel.
“There are a lot of other strategies we can use to address building electrification,” he said, ranging from incentives, like tax credits from the Inflation Reduction Act to promote electrification upgrades, to policy approaches that aren’t outright bans, such as regulations on emissions.
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In one example from last year, the Bay Area Air Quality District amended its building appliance rules to gradually phase out some gas appliances that emit harmful nitrogen oxides, which have been linked to asthma, lung cancer and premature death. Beginning in 2027, only zero-emission, electric water heaters can be sold or installed in Bay Area homes or businesses; in 2029 and 2031, respectively, the rule will be expanded to require electric furnaces and large commercial water heaters.
John Caner, CEO of the Downtown Berkeley Association, said the city could have avoided the lawsuit entirely had it chosen to compromise with some local business owners and revise the ordinance to allow gas in first-floor retail spaces for restaurants and commercial kitchens.
“We’re all really on the same team on this around climate change,” Caner said, noting that he personally supports requiring electric utilities on the upper floors of new buildings. The city’s ordinance, he said, “was perfect being the enemy of good — very good, to be honest.”
In 2023, Caner and a handful of local commerce groups sent a letter to the Berkeley City Council, urging it to loosen its gas ban. Restaurants are “one of the few viable uses of ground floor retail,” the letter stated, and requiring no-gas restaurants would put new mixed-use projects in Berkeley at a serious competitive disadvantage.
“An absolute prohibition was a regulation too far,” said Patrick Kennedy, CEO of Panoramic Interests, which had six all-electric, car-free projects in Berkeley greenlit while the gas ban ordinance was in place. Kennedy does not intend to add natural gas infrastructure back into those projects.
“I don’t think [the repeal] will make much difference with respect to climate change, but it will make a big difference in improving the fortunes of downtown and drawing more people and more businesses there,” Kennedy said. Drawing people to live in urban locations with “lively street life and restaurants” and public transit would have a more direct impact on reducing emissions, as it means fewer cars on roads, he said.
This story was updated on April 9 to include a statement from Deputy City Attorney Lauren Packard, who said the city had “no notion” that gas pipes were included in the scope of the EPCA.
