Ninth Circuit Rules Berkeley CA’s Gas Ban Preempted by Federal Law

On January 2, the U.S. Court of Appeals of the Ninth Circuit denied a request for rehearing in a case preempting a city ordinance prohibiting the installation of natural gas piping within newly constructed buildings in the City of Berkeley, California.  This means that the appeals court’s decision in April 2023 will remain in effect unless the U.S. Supreme Court accepts the case for review.

In the case, California Restaurant Association v. City of Berkeley, the appeals court held that the Energy Policy and Conservation Act (“EPCA”), 42 U.S.C. § 6297(c), expressly preempts State and local regulations concerning the energy use of many natural gas appliances, including those used in household and restaurant kitchens. Instead of directly banning those appliances in new buildings, the court noted that Berkeley took a more circuitous route to the same result. It enacted a building code that prohibits natural gas piping into those buildings, rendering the gas appliances useless.

The district court had dismissed the suit, holding that the Act’s preemptive scope was limited to ordinances that facially or directly regulate covered appliances. But the court of appeals reversed that decision, concluding that such limits do not appear in EPCA’s text.  The court of appeals held that the plain text and structure of EPCA’s preemption provision encompasses building codes that regulate natural gas use by covered products, and by preventing such appliances from using natural gas, the new Berkeley building code falls under the preemption provision.  The City requested rehearing of that decision, and the request was denied.

EPCA was enacted in 1975, and established a federal program consisting of test procedures, labeling, and energy targets for consumer products.  The covered products are set out in statue and include furnaces fueled by natural gas, propane and home heating oil.  The Department of Energy establishes energy-efficiency standards for certain appliances and equipment, and currently covers more than 60 different products.  Under the preemption provision, no State or local government may impose a regulation “concerning the energy efficiency, energy use, or water use of the covered product.”  The court of appeals found that the Berkely ban on natural gas piping was preempted under this standard.

This decision is now mandatory law in the States covered by the Ninth Circuit, which includes California, Oregon, Washington, Arizona, Nevada, Idaho, Montana, Alaska, and Hawaii. The decision will also be highly influential on any other court hearing a challenge to a similar ban in other States. The City of Berkely has 90 days to request review in the U.S. Supreme Court.

This article is courtesy of NEFI Regulatory Counsel Rick Schweitzer