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AGC testimony on natural-gas ban for new construction

AGC testimony on natural-gas ban for new construction – As the State Building Code Council considers banning the use of natural gas in most new residential and commercial construction, AGC submitted the following testimony to the Council.

State Building Code Council Chair:
With roots going back to 1922, the Associated General Contractors (AGC) of Washington is the state’s largest and oldest commercial-construction trade association. Our members build schools, roads, bridges, underground utilities, any commercial structure, and multi-family housing. Essentially our membership constructs everything in the built environment apart from single-family housing. Over the last century, AGC members have built the State of Washington proudly and with professional integrity.

AGC has grave concerns with regards to adoption of any proposal that seeks to completely replace natural gas with electricity in new construction, thus increasing demand, pushing up costs and increasing the risk of electricity shortages especially during peak demand hours. Creating a monopoly is always bad and providing choice for consumers is always good.

The AGC representative on the State Building Code Council (SBCC) and AGC staff have listened to many, many hours of pro and con testimony with regards to the natural gas ban. Some of the most compelling testimony came from the International Brotherhood of Electrical Workers (IBEW). The IBEW stated several times that the electrical grid in the Northwest cannot handle an increased load. Additional large-scale transmission line development and the substation construction needed to handle a heavy increase in capacity will take many years to permit and install. An immediate increase in pressure on the electrical grid could be a huge disaster and we would be following California with their constant brownout problems. The IBEW additionally stated that they have a workforce development problem right now with regards to transmission line workers and this shortage is not going away anytime soon. Some transmission line workers are being recruited to work in California with wages that are significantly higher than what they find in Washington State. Because of all these reasons the brakes need to be applied with regards to an immediate natural gas ban. Too many practical problems exist, and immediate solutions are not in place.

Doug Orth of Absher Construction was Chair of the SBCC from 2018-2020 and is quoted as saying, “To reach the 70% CO2 reduction required by 2031, it is going to take new technology that is not currently in the marketplace, or the cost of construction is going to skyrocket. Almost certainly the latter.” Mr. Orth has been providing commercial preconstruction services to clients for over 30 years. During preconstruction meetings developers/property owners meet with construction firms and they discuss project budgets, scope, value engineering, materials to be used, a risk assessment is made, schedules are discussed, safety issues are managed and a cashflow analysis is done so confidence exists to ensure the project can be completed. These meetings are very practical in nature and force both parties to face realistic measurements to successfully complete the project. Mr. Orth has attended hundreds of these types of meetings over the decades. Switching from natural gas to electricity will cause some developers/property owners to either lay the proposed construction project aside completely, decide to invest in another state or reduce the total amount of construction. All three options are job killers for construction workers and hurt the economic development we need in rural, suburban, and urban communities.

Our state is facing a crisis in affordable housing. This measure will make housing even less affordable by increasing the cost of rents and mortgages for single and multi-family housing and contribute to affordable housing crisis in our state. The 2021 Washington State Energy Code must be crafted in such a way to be balanced with the immediate needs of housing affordability.

21.8% of electricity generation in Washington State was produced by fossil fuel fired plants in 2019. The obvious take-away in that statistic is that even if we were to replace natural gas heating with electricity in the Energy Code, a significant percentage of that electricity will be generated from fossil fuels. As our climate changes and our region faces reduced rainfall and snowpack, the hydro-electric plants may not be able to produce as much electricity as they have in the past putting even more demand on fossil fuel electrical sources.

While we support the long-term goal of reduced carbon emissions, the path to that goal must be carefully considered and carried out in such a way to avoid significant unintended consequences.

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