Environmental Advocates Call on Gov.-Elect Wes Moore to Roll Back State Funding for Fossil Fuel Industry

Contrary to Maryland’s climate and clean energy goals, the Maryland Energy Administration has announced $9.25 million in grants for expanding natural gas infrastructure in the state, angering environmentalists who have called the move a handout to the fossil fuel industry at ratepayer’s expense. 

The MEA grant announcement came the day after Maryland became one of four states in the midterm elections that chose Democratic governors and Democrats to run both houses of their state legislatures, enhancing what climate activists saw as the potential to make rapid progress on global warming.

The millions in grants for what the MEA said would be for a “cleaner, resilient energy program” are funded through the Maryland Gas Expansion Fund established by the state’s Public Service Commission.  

“The purpose of the Maryland Energy Infrastructure Program is to incentivize natural gas infrastructure, and promote natural gas infrastructure,” the MEA said on its website. “Natural gas is cleaner, safer, and easier to store than other fuels. Unlike electricity, natural gas is unlikely to be knocked out by a storm or rationed when demand is high.”

Josh Tulkin, director of the Maryland chapter of Sierra Club, a national nonprofit, called the grants “appalling” and said the MEA’s statement was filled with misinformation about the reliability of gas systems to continue functioning during power outages and about the environmental benefits of gas, which consists primarily of methane, a potent greenhouse gas that traps 20 times more heat in the atmosphere than carbon dioxide over 20 years.  

“It just suggests that the Hogan administration’s energy policy is heavily influenced by the fossil fuel industry,” Tulkin said, adding that instead of getting more Marylanders to benefit from the huge federal rebates for heat pumps, the state agency “is continuing to invest in a technology that is clearly in conflict with the direction that Maryland needs to go.”

Tulkin said that in most cases a gas system will not operate during power outages caused by an extreme weather event unless there is a full backup gas generator, which very few people can afford. 

The grants provide $3.25 million for the local gas distribution companies to invest in expanding gas infrastructure projects and up to $6 million for businesses and other qualified entities in the state for converting their operations to natural gas. The application deadline is Dec. 7. 

The MEA advises the governor and the general assembly on energy policy. ​The agency’s director, Mary Beth Tung, was appointed by Gov. Larry Hogan, a Republican, in 2016. 

Jahmai Sharp-Moore, a spokesperson for the Maryland Energy Administration, said that the grant program is focused on bringing natural gas energy to areas of Maryland that have been historically deprived of clean energy options, and of the economic opportunities and environmental benefits that low-cost fuels can provide. 

“Through this program, MEA has awarded $11.5 million to 20 Maryland state and local government entities, public schools and businesses,” Sharp-Moore said, adding that it resulted in offsetting an estimated 32,000 metric tons of carbon emissions a year, equivalent to 5,760 homes’ annual electricity use.  

Rachel Golden, a spokesperson for the Rocky Mountain Institute (RMI), a global nonprofit headquartered in Colorado with expertise in renewable energy, said that the grants were “very inconsistent with the state’s climate plans and will move the state in the wrong direction, and will end up being costly for the residents and businesses in Maryland.” 

She said that MEA’s claim that “[n]atural gas is cleaner, safer, and easier to store than other fuels” is contrary to basic science and called it “concerning” that a government agency tasked with shaping the state’s energy policy is peddling a false claim purported by fossil fuel industry. 

“The gas system takes 30 times longer to restore than the electric system after natural disasters,” Golden said. “I think Maryland is headed in the wrong direction if they think that the gas system is going to be safer and more resilient in the face of natural disasters.”

RMI has done collaborative work with utilities on issues such as decarbonizing gas utilities and electrification of transportation. 

Golden said that it is incumbent upon Democratic Gov.-elect Wes Moore and his administration to make sure that their investments are in line with the state’s climate plans. She said that states like Connecticut are revising similar programs to reflect the concerns for climate. 

Brian Adam Jones, spokesperson for Moore’s transition team, said in a written statement that transitioning to clean energy and reducing dangerous emissions will be the top priority of the incoming administration. “While natural gas may remain a part of our energy portfolio for the time being, it will no longer make any economic sense to invest in new natural gas facilities moving forward,” he said. “Clean energy is our future in Maryland.” 

Oil and natural gas operations are the nation’s largest industrial source of methane, according to the Environmental Protection Agency. The agency this month proposed stronger emissions control standards to cut methane leaks and other health-harming air pollution from hundreds of thousands of oil and gas sources nationwide.  

A wide array of research has shown that gas infrastructure is prone to leaks, and endangers

communities and the environment. One study by the EPA found “massive amounts” of methane leaking from “each piece of equipment” in the natural gas industry, and concluded that global warming could not be reduced by replacing coal and oil fuels with natural gas. 

Another study by the Environmental Defense Fund, a national nonprofit, showed that methane leaks from 2012 to 2018 in the U.S. were 60 percent higher than the government’s estimate. Measuring methane emissions from the U.S. oil and gas supply chain, the nonprofit showed that at least 13 million metric tons of methane leaked a year, compared to EPA’s 8 million metric tons per year estimate. Thirteen million tons of methane is nearly equal to the annual emissions of all 227 million automobiles on U.S. roads over the course of a year.  

“Now is not the time for the State to be running programs that promote expanding gas infrastructure. Expansion leads to long-term dependence on natural gas that is contrary to the State’s climate goals,” David Lapp, the state’s People’s Counsel in ratepayer hearings, said in a statement. He added that Maryland’s gas utilities are already spending more than a half billion dollars a year on new and replacement gas infrastructure. 

“That spending is locked in for decades to come and ultimately costs customers more than three times the initial investment after the utility’s return is counted,” Lapp said. “It also adds to the risk of stranded costs from pipes that may have no useful purpose long before the costs are paid.” 

The latest study by the Office of the People’s Counsel, released last week, warned that Maryland’s gas utility customers should prepare for gas utility rates to spiral upward, doubling or tripling 2021 levels by 2035, and potentially reaching levels more than 10 times higher by 2050. The study evaluated what decarbonization means for the gas utilities as the residential building sector transitions off natural gas, with almost all residential customers heating their homes solely with electricity by 2050. 

“Because we need to address climate change, to which fossil gas contributes, gas utilities themselves face the possibility that their investments will become obsolete and uneconomic,” Lapp said. “If that happens, the public may be asked to bail them out.” 

Emily Scarr, director of Maryland PIRG, the Baltimore-based consumer advocacy group, said that cooking with gas produces dangerous levels of indoor air pollution. Children living in homes where people cook meals with gas-powered appliances, she said, have a 42 percent higher chance of experiencing asthma symptoms. 

“Using gas to heat our homes and businesses is bad for the environment and our health, and increasingly unaffordable in broad swaths of Maryland,” Scarr said. “Through energy efficiency, building electrification and federal incentives, we have an opportunity to improve the well-being and economic security of all Marylanders.” 

Kim Coble, executive director of the nonprofit Maryland League of Conservation Voters, said that for the last three years the Maryland Energy Administration has consistently voted against the recommendations by the Maryland Commission on Climate Change (MCCC) to help the state meet the challenges of climate change. 

The MCCC’s 2021 Building Energy Transition Plan found that “[a]ll-electric new buildings of all types—residential and commercial—have the lowest total annual costs (including equipment, maintenance, and energy costs) in every net-zero emissions scenario it modeled.” The commission advised the state’s general assembly to adopt an all-electric construction code for all new residential, commercial and state-funded buildings no later than 2024.  

“I think the MEA is prioritizing economics over environment, utilities over communities, and profits over human health,” Coble said, adding that the incoming Moore administration is also committed to rolling back fossil fuel investments from an environmental justice perspective.    

“There’s human health risks and safety risks, as well as greenhouse gas risks that are associated with gas infrastructure,” she said. “And we need to be investing in renewable energy and that’s what I’m expecting from the Moore administration. That’s what Marylanders want, need and deserve.”