House Panel Examines Natural Gas Bans and Housing Costs

New York became the first state to prohibit fossil-fuel equipment and building systems in most new buildings, with requirements beginning for certain new buildings at the end of 2025 and broader requirements taking effect later.

The Justice Department sued California cities Petaluma and Morgan Hill in January, arguing that their restrictions on natural gas infrastructure in new construction were preempted by the federal Energy Policy and Conservation Act. Both cities subsequently rescinded or modified their restrictions, and the Justice Department voluntarily dismissed the lawsuit in March.

Federal appeals courts have reached different conclusions about whether such policies are preempted by federal appliance-efficiency law. The Ninth Circuit held in litigation over Berkeley, California, that federal law preempted the city's prohibition on natural gas infrastructure in new buildings. On June 30, the U.S. Court of Appeals for the Second Circuit upheld New York's All-Electric Buildings Act and New York City's Local Law 154, concluding that the laws are not preempted by the Energy Policy and Conservation Act.

What They're Saying

Four witnesses testified at the hearing: Mike Fazio, executive director of the New York State Builders Association; Patrick McCormick, former chief counsel for the Senate Committee on Energy and Natural Resources; James Conde, a partner at Boyden Gray PLLC affiliated with the Prime Mover Institute; and Pete Wyckoff, vice president of policy at Evergreen Action.

Fazio, testifying on behalf of the National Association of Home Builders, argued that restrictions on natural gas exacerbate housing affordability challenges. He said fully electrifying a new home in colder climates can add more than $15,000 to construction costs.

Fazio also cited a National Association of Home Builders analysis finding that a $1,000 increase in the price of a new home could price thousands of New York households out of the market.

McCormick argued that state and local restrictions on natural gas increase costs and limit consumer choice, while Conde discussed federal preemption and legal challenges to state and local electrification requirements.

Wyckoff, the minority witness, defended building electrification policies and argued that efficient electric appliances can reduce household energy costs while decreasing pollution.

Chair Eric Burlison (R-MO) argued that natural gas restrictions increase costs and reduce consumer choice. Ranking Member Maxwell Frost (D-FL) offered the Democratic response to the hearing's arguments about electrification and affordability.

Political Stakes

The hearing highlighted competing federal and state approaches to building energy policy as Congress considers legislation that could limit state and local authority over energy sources.

Rep. Nick Langworthy (R-NY) introduced the Energy Choice Act, which would prohibit state and local governments from restricting access to an energy source based on the type or source of energy delivered.

Sen. Mike Lee (R-UT), chair of the Senate Energy and Natural Resources Committee, introduced the Energy Efficiency Reform Act in August. The measure would revise federal appliance-efficiency law, including its provisions governing federal preemption of state standards.

The National Association of Home Builders sent a letter to lawmakers in February arguing that state and local restrictions on natural gas access and electrification mandates increase housing costs. The New York State Builders Association urged Gov. Kathy Hochul (D-NY) in November 2025 to consider delaying the state's all-electric building requirements.

Supporters of electrification policies dispute the argument that those requirements necessarily increase overall household costs. A 2025 analysis found an average of $12,050 in savings over 15 years for households in newly built, all-electric single-family homes compared with homes using gas or propane.

The Center on Budget and Policy Priorities has called on states to provide direct energy assistance to low- and moderate-income households while managing the costs associated with the transition to cleaner energy systems.

The legal dispute remains significant because the Second and Ninth circuits have taken different approaches to federal preemption. The Second Circuit expressly acknowledged its disagreement with the Ninth Circuit when it upheld New York's state and city requirements.

What's Next

Langworthy and other supporters of the Energy Choice Act are seeking federal legislation limiting state and local restrictions on particular energy sources.

The House has separately passed H.R. 1949, the Unlocking Our Domestic LNG Potential Act of 2025, which would change federal authority over approvals for imports and exports of natural gas. The House approved the measure 217-188 in November 2025, and it was subsequently placed on the Senate Legislative Calendar.

The conflicting Second and Ninth Circuit interpretations of the Energy Policy and Conservation Act also leave unresolved questions about federal preemption of state and local building-electrification policies.

The Bottom Line

The Sept. 2 hearing highlighted a broader dispute over who should determine the energy sources available in new buildings. Republicans and industry witnesses argued that natural gas restrictions raise construction and energy costs and reduce consumer choice, while supporters of electrification policies argued that the transition can reduce long-term household costs and pollution.

The debate is proceeding simultaneously in Congress and the courts, with lawmakers considering federal preemption legislation as federal appeals courts have reached different conclusions about the legality of state and local restrictions.

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