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City administrator briefs council on Climate Commitment Act'related costs and policy options for municipal gas utility
Summary
City Administrator Chris Searcy briefed the council on the Climate Commitment Act (CCA), explaining how it applies to municipal gas utilities, that the city's natural gas utility is marginally over the 25,000-metric-ton compliance threshold, and that first-year costs were about $250,000 with later costs approaching $400,000; staff recommended further analysis and potential legislative coordination with other municipal utilities.
City Administrator Chris Searcy told the Uniontown City Council on March 9 that the Climate Commitment Act (CCA) creates a cap-and-invest program that now applies to certain municipal natural gas utilities, including the city's utility.
Searcy said the program requires covered entities to obtain annual carbon allowances equal to their greenhouse gas emissions; the Department of Ecology runs quarterly auctions and distributes limited no-cost allowances. "We are just marginally over the threshold... our average emissions for '23 through '25 was a little over 25,000 metric tons," Searcy said, noting that being within 10% of the threshold could keep a utility in the program at Ecology's discretion.
Searcy outlined the mechanics and fiscal implications: no-cost allowances are phased down over time, auction consignments increase, and the city currently uses proceeds from auctioned allowances to offset customer bill impacts. He estimated the city's first-year net cost at about $250,000 (2023) and recent annual costs approaching about $400,000, and said the city could see compliance costs exceed $1 million in later years depending on allowance prices and program linkage with other markets.
Searcy described possible policy responses the council may consider later: seeking legislative carve-outs or alternative compliance paths for municipal gas utilities, pursuing grants for decarbonization planning (noting Ellensburg had a $750,000 grant), adopting full cost recovery for new development connections, or investing in programs to reduce gas load (such as heat-pump conversions). He stressed that additional staff and technical resources would likely be necessary to manage any decarbonization program.
Council members asked for clearer cost projections and timelines; Searcy recommended returning in May with further analysis, alignment checks with other municipal utilities and options for legislative or grant-based approaches. "We must comply with it," Searcy said, "but we need policy guidance from the council on how to approach potential alternative compliance options and customer impacts."
