NW Natural, a major U.S. gas utility, named in $52bn climate lawsuit

(Portland, Oregon) — Multnomah County in Oregon named gas utility NW Natural as a defendant in its $52 billion climate liability lawsuit, the first time that a U.S. gas utility has been targeted in a climate accountability case.

The lawsuit was originally filed in June 2023, naming ExxonMobil, Shell, Chevron, BP, ConocoPhillips, as well as several trade associations and consultants, including the American Petroleum Institute, Western States Petroleum Association, and McKinsey & Company.

As Gas Outlook reported at the time, the lawsuit alleges that the oil industry and its lobbyists have inflicted damages on the public stemming from decades of pollution and a long history of misinformation and obfuscation.

But on October 7th, 2024, the county amended its lawsuit to include NW Natural, the largest gas utility in the state, which accounts for 9 percent of Oregon’s total greenhouse gas emissions.

“We’re already paying dearly in Multnomah County for our climate crisis – with our tax dollars, with our health and with our lives. Going forward we have to strengthen our safety net just to keep people safe,” said Multnomah County Chair Jessica Vega Pederson. “As we learned in this country when we took on big tobacco, this is not an easy step or one I take lightly but I do believe it’s our best way to fight for our community and protect our future.”

Like dozens of other cases around the country that are targetting oil and gas companies, the lawsuit cites historic levels of pollution and extensive evidence of an industry-led, decades-long public relations campaign to deceive the public about the hazards of climate change.

But the Multnomah case is also built around a specific climate disaster – the 2021 “heat dome” that saw temperatures soar above 46 degrees Celsius (116 degrees Fahrenheit), which shattered previous records. A climate attribution study found that the intensity of the heat wave would have been “virtually impossible” without human-caused climate change.

In Multnomah County, where the state’s largest city of Portland is located, 69 people died during the 2021 disaster. Hundreds more died throughout the Pacific Northwest.

The county is seeking $52 billion in damages, a sum that includes $2 billion in compensation, but also $50 billion to fund a county-wide programme for rapid energy transition and climate adaptation.

The role of gas utilities

While some major utilities have both electric and gas businesses, NW Natural is a “gas-only” utility. Public policies aimed at transitioning buildings from gas to all-electric appliances pose an existential threat to the company’s business. As a result, NW Natural has spent years fighting local and statewide climate policies, using advertising and lobbying campaigns to slow the transition away from gas.

“NW Natural engaged in an enterprise of misrepresentation about the effects its products would have on the climate, and that the use of its products could cause an extreme heat event to occur,” the lawsuit says.

One of the core parts of NW Natural’s strategy is its public relations campaign promoting renewable natural gas (RNG), or methane derived from landfills and agricultural facilities. The utility made RNG a pillar of its climate plan, claiming that by delivering RNG to customers, it could reduce emissions. At the time, in 2021 and 2022, state regulators were implementing a rule that would require utilities to slash their emissions in half by 2035.

There are many problems with RNG. It is highly expensive and can only be sourced in small quantities. It could never replace a sprawling gas system that serves 2 million customers. NW Natural’s plan is unrealistic, and even Oregon’s utility regulators have criticized the proposed programme.

Moreover, the problem, as critics saw it, was more fundamental. Even if NW Natural’s concept could be expanded, RNG is still methane. It leaks from pipes in the same way that fossil-based methane does. And burning it results in emissions too.

However, as the lawsuit alleges, the PR campaign served a specific purpose. It was aimed at making customers feel comfortable about continuing to use methane gas by creating a perception that the gas stream was becoming cleaner over time. The ads also positioned NW Natural as a forward-looking utility that was working hard to slash its pollution.

In another example, NW Natural sent free activity booklets to public schools, which contained puzzles and games that promoted gas. Environmental groups criticised the campaign as industry propaganda.

Meanwhile, even as it publicly advertised its gas as a climate solution, NW Natural quietly lobbied to weaken climate policies. It even sued the state to block its signature policy that would require utilities to cut their emissions.

NW Natural attempted to pass on the costs of these advertising campaigns to its customers in their monthly bills. That effort was not entirely successful. Utility regulators subsequently rejected some of those requests.

Climate groups celebrated Multnomah County’s decision to include NW Natural as a defendant in its high-profile lawsuit.

“It’s past time for NW Natural to be recognized for what it is: a climate villain working to undermine the state’s transition off of fossil fuels, while polluting our air and our atmosphere with its dirty methane gas,” Dylan Plummer, campaign advisor for the Sierra Club Building Electrification Campaign, said in a statement.

“While our communities have been developing creative solutions to the climate crisis, NW Natural has been using the Big Tobacco playbook to cast doubt on settled science, litigate against common sense policy, and establish front groups designed to mislead the public,” it said.

NW Natural did not respond to a request for comment from Gas Outlook.

The decision by Multnomah County to sue NW Natural is a significant development in this particular lawsuit, but importantly, it also signals a broadening of the legal fight against the fossil fuel industry. It is the first time that a utility has been the target.

Experts believe this could mark a new front in a widening legal battle against the fossil fuel industry, which includes gas utilities.

“Gas utilities have known for decades that their products fuel the climate crisis, yet they continue to deceptively market methane gas as a climate solution,” Alyssa Johl, general counsel of the Center for Climate Integrity, a climate liability NGO, said in a statement.

“NW Natural is now the first to be named as a defendant in a climate deception lawsuit, but it likely won’t be the last.”