HomeMy WebLinkAbout9/19/2023 Item 7b, Veium
Eric Veium <
To:E-mail Council Website
Subject:SLO City Council - Item 7B: Amendments to Energy Code: SUPPORT
Attachments:SoCalGas charged customers millions to fight climate solutions, Sacramento Bee, The
(CA), August 21, 2023, p1A.pdf; A hot - stove - league - SoCalGas enjoins restaurants
to slow bans - on gas proposed, Sacramento Bee, The (CA), August 20, 2023, p4A.pdf;
Emails show restaurant group's efforts in electrification debate, Sacramento Bee, The
(CA), August 26, 2023, p1A.pdf; SoCalGas spends millions to fight bans on restaurant
gas use _ The Sacramento Bee.pdf
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Honorable Mayor and Council Members,
On behalf of the SLO Climate Coalition, I write in support of your efforts to adopt amendments to the energy
code that prioritize new building electrification over health and climate harming fossil fuels.
I recognize the difficult position that our city and many cities across the state are faced with to comply with
legal restrictions limiting our ability to effectively reduce harmful air pollution and carbon emissions in our
buildings. I want to thank your staff in Community Development and Sustainability for proposing the strongest
policy possible albeit insufficient for the urgency that the climate crisis demands.
Allow me to provide input on three critical issues that I request your council’s full support and clear direction to
the City Manager and staff.
1.
2.
3. Prioritize and Resource Plan Review and Code Enforcement
4. - The flexible structure of the proposed policy makes it fairly simple to ‘game’ the Title 24 energy code
calculations. It’s imperative that your community development staff have clear direction and the proper
training and resources to prioritize enforcement
5. of the proposed policy. Enforcement includes evaluating energy compliance during permitting and
verification during inspections. Without effective enforcement, this policy WILL be gamed and will have
limited impact and effectiveness.
6.
7.
8.
9. Track Appliance-Level Data from New Building Permits
10. - In order to evaluate the effectiveness of this policy and the regressive impact from continued
installation of fossil-fuel appliances in new buildings, we ask you to direct your community development
staff to implement basic appliance-level tracking for
11. new buildings. Every new building that installs fossil-fuel appliances becomes an existing building that
will require a near-term electric appliance replacement.
12.
13.
14.
15. Ensure the 2025 Building Code Requires All Electric New Buildings
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16. - This is the ultimate goal for clean and healthy new buildings in SLO City and California. There has
been discussion that the 2025 Building Code update should require all electric new
buildings. However, this is not guaranteed. I call on you to clearly
17. direct staff to do everything in our city’s power to ensure that the next building code requires all electric
new buildings. An all electric building code will finally put this issue to rest for SLO City so that we may
focus our resources and attention on
18. our many other climate and resilience priorities. I’m aware that staff has already taken steps towards
this end including joining a sign-on letter to the governor and collaborating with other cities. Reinforcing
your support for their ongoing efforts is crucial
19. to empower their continued action.
20.
Finally, let’s make sure we name the elephant in the room. We are here today forced to adopt a stop-gap new
buildings policy because of the actions of SocalGas. Let me be clear that we support and appreciate the
workers of SocalGas that maintain and repair the gas system to be as safe as possible. It is the executives of
SocalGas that have violated our trust and who are responsible.
This same SocalGas that threatened our community and council members during Covid has now overruled our
city’s obligation to provide for safe and healthy homes and stalled our progress to meet our commitment to
carbon neutrality by 2035. These continued attacks are putting our community at risk of health and climate
harms and wasting staff time and city resources that could better be used to advance our communities
priorities.
SocalGas has been spending millions ($36 million since 2019) actively lobbying across the state to oppose
common sense climate actions and are singularly responsible for stalling local and statewide decarbonization
efforts including building decarbonization with their lobbying and astroturf front groups.
This behavior is well documented in the state-wide media such as the LA times and Sac Bee. See the attached
August 2023 Sac Bee articles for a more complete picture (Please include these articles in the public record).
Socalgas has been caught and fined millions of dollars for misusing ratepayer dollars (our money) to fund their
anti-electrification campaigns.
SocalGas is not a trustworthy corporate neighbor to our City and we publicly admonish SocalGas for their
harmful and deceptive behavior.
Thank you for considering our input and for your continued commitment to a climate-resilient City
Highest regards,
Eric
Eric Veium, MPP, CEM, CEP
Chair, Co-Executive Director
SLO Climate Coalition
Need to chat? Book a meeting with me here!
(805) 835-3669
eric@sloclimatecoalition.org
https://www.linkedin.com/in/ericveium/
Celebrating 5+ Years!
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SoCalGas charged customers millions to fight - Sacramento Bee, The (CA) - August 21, 2023 - page 1A
August 21, 2023 | Sacramento Bee, The (CA) | Joe Rubin and Ari Plachta; Staff Writer | Page 1A
At first glance, a September 2019 meeting before the California Public Utilities Commission in Los
Angeles looked like democracy in action. Speakers lined up before the state's powerful utility
regulator to debate the merits of natural gas.
One by one, climate activists supported powering buildingswith zero-emission appliances running
on clean electricity. Burning gas in homes and businesses currently emits a quarter of the state's
carbon pollution that is worseningclimate change.
More than a dozen business owners followed suit, arguing instead for the preservation of gas. Their
activism, however, was far from grassroots.
A concealed contract showed that the nation's largest gas utility had paid a leading Los Angeles
business association to recruit speakers against electrification, and drive them to the meeting using
ratepayer money.
Speaker Sassan Rahimzadeh, owner of a San Diego dry cleaning company, was recruited to attend.
He told The Sacramento Bee he was troubled to learn that the arrangement was charged to
customers of SoCalGas.
"As a ratepayer," he said, "that would concern me big time."
Billing customers for anything other than providing safe and reliable gas service - such as political
activities - is a violation of state and federal law. Yet when it comes to SoCalGas using ratepayer
dollars to pay for political lobbying, this case is merely one of many since 2019.
After reviewing public documents, The Bee has determined that SoCalGas booked at least $36
million to ratepayers for political lobbying to undermine California policies aimed at addressing the
climate crisis since 2019.
That figure is merely the "tip of the iceberg," according to a 404-page legal filing Monday by the
PUC's Public Advocate's Office. The independent state watchdog called on the commission to slash
the utility 's request for rate hikes by $80 million, citing "the utility 's ongoing and historic misuse of
ratepayer funds for political activities."
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SoCalGas was fined $10 million for the same behavior last year. In addition, the independent state
watchdog is recommending another $233 million in fines because of SoCalGas' refusal to open its
books to investigators.
The Sacramento Bee's investigation found numerous previously unreported examples of instances
that critics contend are a misuse of customer funds to derail electrification.
SoCalGas sought to bill customers $732,000 for undefined legal work in 2022 from the Redwood
City law firm Reichman Jorgensen, which represented the California Restaurant Association in a
lawsuit against Berkeley 's first-in-the-nation gas ban. After receiving questions from The Bee, the
company rescinded the charge. This was in addition to $1.1 million to the firm that the utility called
an accounting error and said it would charge instead to its corporate account.
Customers were charged $744,000 by SoCalGas for legal fees to another firm, Holland & Knight,
that has launched a series of lawsuits against California climate policies and heavily lobbied against
building electrification. SoCalGas denies that money was spent on lobbying but refused to provide
spending details, citing attorney-client privilege.
SoCalGas billed ratepayers $191,789 to defend itself against a California Attorney General
investigation into marketing claims that violated state and federal law because the company stated
natural gas is a "renewable" energy source. The company agreed on Monday to make a "corrective"
statement online and pay $175,000 in penalties.
SoCalGas billed ratepayers $790,000 for a lawsuit filed in 2020 against the California Energy
Commission, claiming the agency was unfairly biased against natural gas. The lawsuit was dropped
in 2021.
And as mentioned above, SoCalGas paid the Business Federation of Los Angeles, or BizFed, an
undisclosed sum to recruit opposition to electrification at two meetings before the Public Utilities
Commission in 2019. The agency 's independent watchdog is calling for penalties related to the
practice.
SoCalGas' pattern of using ratepayer money calls into question whether its Southern California
customers - from San Diego to Fresno and San Luis Obispo - have been unfairly billed for years.
"SoCalGas has been using ratepayer dollars to engage in advocacy efforts against California's
climate policies," said Mary Flannelly, a spokesperson for the Public Advocates Office. "This
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inappropriate use of ratepayer funds only serves to benefit SoCalGas at a time when ratepayers
are dealing with increasingly high customer bills."
Officials at the Public Advocates office say the utility has refused since 2020 to allow access for
investigators to examine accounting data and crucial documents. Mike Campbell, program
manager for the Advocate's Office, told The Bee he is concerned that the tactics are hiding possible
"financial malfeasance."
SoCalGas counters that it has a first amendment right backed by legal precedent to keep its books
closed.
The utility 's actions have also stalled local and statewide decarbonization efforts, affecting
Californians up and down the state as communities, including Sacramento, begin to confront the
impacts of climate change.
As early as 2015, company emails show that executives identified building electrification as "a
significant risk to our business." In the years since, SoCalGas has engaged in a sprawling and varied
opposition campaign to defend its bottom line.
Critics contend the utility is exploiting the state's rate approval process and lax oversight by billing
ratepayers for things it shouldn't, such as political activities, and only correcting the charges
months or years later when regulators or members of the public uncover them.
A former U.S. attorney who has previously prosecuted gas utilities said the issues identified by The
Bee could constitute the basis for a fraud investigation.
"If they are taking money from ratepayers, putting the funds into their big coffers for political gain,
all the while keeping that practice secret from their customers, that's fraud," said Evan Gotlob, now
a partner with the law firm Saul Ewing LLP.
SoCalGas rejected the allegation.
"Fraud is a serious, spurious, and irresponsible claim," SoCalGas spokesperson Alice Walton said in
an email to The Bee, "and one that SoCalGas categorically rejects."
Misuse of customer funds has landed utilities in legal trouble across the nation, including in Florida,
Illinois and Ohio. Ohio's leading utility used $60 million in ratepayer funds to bribe politicians to
subsidize coal and nuclear plants and roll back climate initiatives. The state's speaker of the house
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was sentenced to a lengthy federal prison term in June.
Experts agree there is one core reason why SoCalGas has so aggressively fought zero-emissions
policies: Billions of dollars of market share and the future of energy in California is at stake.
"If California electrifies the way that it has been, which is totally needed to address climate change,
where does that leave SoCalGas?" asked David Pomerantz, executive director of the Energy &
Policy Institute. "They 're a pipeline company. If we're not using the pipelines, they 're in big trouble."
In an email to The Bee, SoCalGas emphasized its ambition to reach net-zero emissions in 2045 by
focusing on hydrogen, renewable natural gas and carbon capture technology.
Customer-funded climate opposition?
State regulators are well aware of SoCalGas' activities.
The Public Advocates Office published a 41-page report in March identifying tens of millions of
dollars in inappropriate political spending booked to customers between 2017 and 2019.
Contained in that report is a heavily redacted contract signed by the utility with virtually no details.
The Bee was able to uncover that contract was signed by BizFed.
Several people who made comments at a Sept. 10, 2019 meeting in Los Angeles acknowledged that
they had been encouraged to attend by BizFed as well as by the Sacramento-based California
Restaurant Association, which received $1.8 million in donations from SoCalGas and its owner
Sempra between 2019 and 2022.
Rahimzadeh, the dry cleaning business owner who describes himself as an environmentalist with
economic concerns about electrification, said he was contacted by BizFed about the PUC meeting.
"They told me, 'Hey, you know, there's this hearing here in LA, this is where it's at.' They met me
there." He also recalls being contacted directly by SoCalGas prior to the meeting and asked to
attend.
The amount of the contract billed to ratepayers remains undisclosed. SoCalGas said releasing it
would violate attorney-client privilege and first amendment rights. BizFed also refused to provide a
copy of the contract to The Bee.
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"We regularly work with diverse business leaders on a wide range of issues affecting our members,
and we do not share those internal communications externally," said Biz Fed's director of advocacy
and policy Sarah Wilfong, who also spoke at the meeting.
SoCalGas told The Bee in an email through a contract public relations firm, "The improper
disclosure of a standard outreach contract and other hand-picked materials from several years ago,
are part of an ongoing effort by certain intervenors to misrepresent SoCalGas' public policy
positions."
Campbell, with the Public Advocate's Office, told The Bee he "absolutely " thought the entire
contract should be public, but that his hands were tied once the company claimed it was privileged
information.
The contract is merely one piece of a tense standoff between the utility and state officials over
transparency regarding company spending with customer funds. Campbell has waited years to
access SoCalGas' financial and other data.
"The utility," he said, "has tried everything they can think of to throw sand in the gears and assert
that the regulators shouldn't actually be able to see how they spend ratepayers' money."
Campbell believes the contract is unlawful.
"Raiding ratepayer accounts for lobbying is illegal," Campbell said. "Secondly, it's very clear that you
may not have people speak at these meetings without making clear if you're speaking on the behalf
of someone. That's a violation."
Financial records show BizFed has received $1.01 million in contributions from Sempra and its
subsidiaries since 2017. BizFed also worked with SoCalGas to successfully lobby the Port of Los
Angeles and Long Beach in favor of natural gas trucks, Public Advocate filings show.
The port's decision in favor of natural gas trucks stands to further erode air quality in a region
already suffering from some of the nation's most polluted air.
How SoCalGas pays the bills
In the world of investor-owned utilities such as SoCalGas, there are two kinds of costs: above the
line, which are billed to customers, and below the line, which come from corporate profits.
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One issue that has maddened watchdogs such as Matt Vespa, an attorney for the organization
EarthJustice, is the tens of millions of dollars SoCalGas pays to outside law firms that go on to lobby
regulators and launch lawsuits against climate policies threatening the utility.
SoCalGas has engaged in what critics call a game of cat and mouse. Citing attorney-client privilege,
the utility vehemently denies they are behind the lobbying or lawsuits but refuses to reveal what
customers are actually being billed for.
In October, Vespa requested information from SoCalGas through the PUC about a $1.1 million
payment from a ratepayer account to the law firm Reichman Jorgensen. The utility asserted the
expense should be paid by ratepayers, saying in a written response, "The dollar amount
$1,143,592... is considered a ratepayer cost."
Only after Vespa pressed the matter did the utility admit six months later that it had made an
accounting mistake, what they described as having "unintentionally characterized" $1.1 million in
ratepayer expenses.
The Bee then reviewed financial disclosures filed by the company on May 30 and discovered
another $732,000 in fees to Reichman Jorgensen billed to ratepayers in 2022. After The Bee asked
SoCalGas about the expenditure, the company said it was removing it from the ratepayer account.
It provided no explanation as to why customers had been billed in the first place.
Then in June, after Vespa and the Public Advocates Office questioned tens of millions of dollars that
SoCalGas and Sempra said it had spent for outside legal costs charged to customers, the company
revised its estimate and walked back $5 million in 2021 charges.
"SoCalGas is saying, the system's working," Vespa said. "Intervenors ask questions, and we lowered
it. They should do things right the first time."
Another law firm and more questions
Reichman Jorgensen wasn't the only law firm paid by SoCalGas that went on to lobby and file
lawsuits that would stand to benefit the utility. The Bee discovered the utility also spent more than
a million dollars between 2019 and 2021 with the powerhouse international law firm Holland &
Knight.
More than 50% of the payments to the San Francisco firm were paid for by customers. Holland &
Knight has more than 1,500 lawyers worldwide and is "one of only a few large firms in the U.S. with
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a dedicated Oil and Gas Practice," according to the firm's website.
Jennifer Hernandez, a partner with the firm with a decades-long track record of battling California
regulators on climate change and other environmental regulations, told The Bee she wasn't
involved in any recent work for SoCalGas.
"To the extent you're looking for a smoking gun," she said, "you're not gonna find it."
Hernandez, who sits on the board of BizFed's research institute and advises the group on climate
policy, has been a thorn in the side of California regulators and environmental organizations for
years.
In the late 1990s, The Bee reported how Hernandez stirred controversy among environmentalists
by pushing for what they considered lax cleanup standards in contaminated areas.
Environmentalists believed the proposed legislation was too developer friendly.
Bill Magevern, a staffer for the Sierra Club in the 1990s, recalled in a recent interview that "Jennifer
Hernandez showed up calling herself an environmentalist, a civil rights and housing activist. Later
we learned she was working for the largest landowner in California."
Fast forward 25 years, The Bee found that Hernandez was intricately involved in lobbying California
agencies on issues that are in virtual lockstep with the firm's million dollar client, SoCalGas.
The Bee reviewed more than a dozen documents Hernandez and Holland & Knight sent in 2021 as
part of official proceedings with the California Energy Commission over proposed changes to what
are called Title 24 Building Codes. The discussion included proposed bans on new natural gas
appliances in California.
Hernandez said that despite what others might think, she is concerned about the environment. But
she has also expressed concern with regulatory overreach that she believes ultimately
disproportionately affects working class families.
Internal emails as well as communications with the American Gas Association show that beginning
at least as early as 2015, SoCalGas executives were worried about the impact of a debate at the
CEC over the future of gas water heaters in California and how a ban on the appliance would have
an escalating impact on company profits.
Tensions between SoCalGas and the California Energy Commission simmered. In 2020, SoCalGas
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filed a lawsuit alleging that the agency disregarded state law by deciding "to substantially eliminate"
the use of natural gas in the state. Ratepayer advocates were particularly outraged that the utility
charged its own customers$790,394 for the lawsuit.
The following year, after gaining no traction in the courts, SoCalGas agreed to dismiss its lawsuit.
EarthJustice's Vespa called the litigation a vehicle to "harass" California regulators.
"What is so messed up here," he said, "is not only are ratepayers paying for this litigation, but then
the agencies, which are taxpayer funded, have to squander resources to defend against baseless
harassment lawsuits."
In October of 2022, Vespa became suspicious that SoCalGas paid Holland & Knight with customer
money to lobby on the utility 's behalf. He used a PUC process to require the utility to respond.
It responded, "Holland & Knight LLP did not represent SoCalGas in the 2022 Title 24 Building Code
proceeding." But it did not provide any explanation for its customer-funded payments to the firm,
citing attorney-client privilege.
The Bee examined a lobbying memo submitted to the CEC by Holland & Knight's Hernandez on
behalf of the firm, not a client. The firm said "Holland & Knight further submits these comments in
light of our commitment to the social and economic equity for California's working class families,
who will undoubtedly suffer disparate impacts resulting from the Project."
The 16-page memo Hernandez authored in 2021, the same year her firm received $594,511 in
ratepayer dollars, contained nearly identical points to a memo crafted a few months earlier by
SoCalGas. Both memos downplayed health concerns related to gas appliances and dismissed
findings by leading scientists on the issue.
"Studies have shown that using indoor natural gas appliances does not contribute in any significant
way to indoor air pollution," Hernandez wrote, "and that the use of natural gas appliances does not
impose appreciable health and safety risks beyond those imposed by electric appliances."
Holland & Knight did not respond to questions on what work the firm performed on behalf of
SoCalGas with ratepayer funds or whether Hernandez's communications with the CEC were
related.
Lindsay Buckley, a CEC spokeswoman, when asked if Hernandez was lobbying on behalf of
SoCalGas, responded, "All I can say is what she is saying mirrors what we are hearing from the gas
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company."
SoCalGas did not respond to The Bee's written questions about Holland & Knight. In a general
statement the company said "questions on attorneys' scope of work would require SoCalGas to
disclose non-public, attorney-client privileged advice and counsel these firms provided to SoCalGas
and would be asking SoCalGas to waive its attorney-client privilege and work product, which is
inappropriate."
Vespa is skeptical of SoCalGas' explanations.
"The contents of those letters, they 're very similar," Vespa said. "But it's just hard to pin this stuff
down because then you end up in all these attorney-client privilege issues. And that's similar to
what happened with the Berkeley lawsuit. SoCalGas is saying 'We hired this firm to research all the
legal issues in the litigation, but it's not related.'"
Hernandez has also been the lawyer of record for a flurry of lawsuits filed on behalf of a relatively
obscure organization called The Two Hundred for Home Ownership. The lawsuits challenge the
California Air Resources Board's authority to order certain actions related to climate change,
including regulating vehicle and building emissions. If any of the lawsuits are successful they could
reverse landmark climate change-related regulations.
Electrification in San Luis Obispo
RobertApodaca, the founder of the Oakland-based Two Hundred for Home Ownership, has been
represented by Hernandez in numerous lawsuits filed against the California Air Resources Board.
Apodaca was a central figure in the fight against electrification in San Luis Obispo in 2019, as the
city became the first to take on the issue in SoCalGas territory.
In a phone interview with The Bee, Hernandez said that the climate-related advocacy she has
engaged in with Holland & Knight on behalf of the Two Hundred has been performed free of
charge and not paid for by SoCalGas.
"Just ask my partners," she said. "This a pro-bono passion play and has been for years."
Apodaca's involvement coincided with SoCalGas forming a front group called Californian's for Fair
and Balanced Energy, or C4BES, which purported to be an independent organization but in reality
was a front group for the utility.
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Apodaca became involved in the San Luis Obispo fight shortly after a $99,000 donation landed in
December of 2018 in the account of an organization that he started in 2008, United Latinos Vote. It
was the first donation the organization received in seven years.
The donor was the California Building Industry Association. According to SoCalGas financial
disclosures, the CBIA received $30,000 from SoCalGas and Sempra companies between 2019 and
2022, and has been active in the anti-electrification fight.
Dan Dunmoyer, president and CEO of CBIA told The Bee that the donation had nothing to do with
SoCalGas and was because of the organization's longstanding association with Apodaca and The
Two Hundred.
Following the BIA donation, United Latinos Vote received thousands of dollars in donations from
multiple oil companies, including $3,400 each from Chevron, Marathon and Phillips 66.
Apodaca appeared in the press as United Latinos Vote executive director and penned a full-page ad
in the Los Angeles Times. The ad, an open letter to the Sierra Club, accused the environmental
group of wanting to phase out our "dirty " stoves and cars so that wealthy Californians can buy
subsidized Teslas.
SoCalGas' front group, C4BES, highlighted United Latinos' LA Times ad in an email blast and touted
Apodaca's open letter.
In repeated attempts, the Public Advocate's Office questioned whether C4BES was funded with
ratepayer dollars. SoCalGas initially told the Public Advocate that "ratepayer funds have not been
used to support the founding or launch" of C4BES.
Ultimately, according to the advocate's March report, "SoCalGas revealed that they had booked
costs to create and support C4BES to a ratepayer account, and that the utility authorized $29.1
million for these efforts."
The utility said it then removed the charge from the customer account.
Accountability for customers
The California Public Utilities Commission has been asleep at the switch, advocates say, allowing
SoCalGas to hold back documents and financial records for years while ignoring pleas to take more
punitive action.
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The PUC issued $10 million in fines to the utility in 2022 but the commission's watchdog arm says
that number should be far higher.
The Public Advocate's Office asked the PUC to impose fines of $100,000 per day for not allowing
investigators to access SoCalGas' accounting books and for failing to turn over crucial documents
in 2020.
Campbell told The Bee the office still considers that penalty request active. As of Aug. 15, the total
fines would amount to $233 million.
On Monday, the Public Advocaterecommended another $80 million in rate reductions, saying
"evidence shows that SoCalGas has not tracked employee time" spent on lobbying activity funded
by ratepayers.
Pomerantz, the Executive Director of Energy & Policy, said it's time to get tougher.
"It is the Public Utilities Commission's job," he said, "to hold SoCalGas accountable for following
rules to protect customers from being forced to illicitly fund SoCalGas' anti-electrification political
machinations."
The Bee asked the PUC to comment on concerns that it has been lax in regulating SoCalGas and
what action, if any, it intends to take regarding its public advocate's recommendations.
The PUC responded with a written statement that the agency can not comment at this time
because the agency is currently in the midst of proceedings with SoCalGas to determine costs it
can collect from its customers.
The legislature also could play a role, but so far has largely deferred to the PUC.
Just this year, some states have taken action to address the opaque way utilities use customer
funds. Maine, Connecticut and Colorado passed laws to impose new transparency requirements.
Several advocates told The Bee that legislation in California could help rein in SoCalGas, but so far
no comprehensive reform has been proposed.
There is one state watchdog, however, who has been quietly investigating SoCalGas for a 2019
marketing campaign.
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The campaign falsely claimed that natural gas produced by the utility was a "Affordable, Clean and
Renewable" energy source. That slogan was displayed on SoCalGas' website and printed on
merchandise such as tote bags, t-shirts and notepads as well as promoted at community events.
The attorney general complaint released Monday charged that SoCalGas had violated federal and
state laws related to green energy marketing. In 2018, just a year before the marketing campaign
took place, the attorney general said SoCalGas acknowledged that no gas used in its core market
was renewable.
In 2022, said the attorney general, that percentage was still under 5%.
This harms Californians, Bonta argued, because climate change is "fueling longer, more intense fire
seasons, resulting in catastrophic losses of life and property and damage to natural resources."
SoCalGas has agreed to pay $175,000 in penalties related to the campaign. That amount is less
than the nearly $200,000 the utility charged customers for its legal defense.
Back in June, during PUC proceedings where the utility first acknowledged it was under
investigation by the attorney general, the utility was asked how much it had billed customers for its
legal defense.
SoCalGas wouldn't publicly disclose that information. The company cited attorney-client privilege.
Joe Rubin: 916-321-1006
Ari Plachta: 916-321-1374, @AriPlachta
Copyright (c) 2023 The Sacramento Bee
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hot - stove - league - SoCalGas enjoins - Sacramento Bee, The (CA) - August 20, 2023 - page 4A
August 20, 2023 | Sacramento Bee, The (CA) | Ari Plachta and Joe Rubin; Staff Writer | Page 4A
When Sacramento wanted to ban gas hookups in new buildings two years ago, it sparked a
passionate debate over an unexpected cooking tool: the wok. Restaurateurs argued that cooking a
traditional Chinese stir fry is simply impossible without an open flame.
But the dispute wasn't merely about serving delicious meals to hungry customers. It was also about
the bottom line of the nation's largest gas company, SoCalGas, which serves 21 million customers
as far north as Fresno and along the Central Coast.
As California cities began to cut planet-warming pollution in new buildings, SoCalGas spent millions
to slow the push for building electrification. The Sacramento-based California Restaurant
Association became a key ally in this effort, receiving an influx of funding from the utility and
bringing a lawsuit that could now hamper clean energy policies nationwide.
Gas stoves and cherished cooking traditions were at the center of this campaign. After SoCalGas
recruited primarily Asian-American community and culinary leaders as pro-gas spokespeople, the
restaurant association funded widely circulated research that scientists describe as misleading and
helped weaken Sacramento's own electrification ordinance.
In statements to The Sacramento Bee, the restaurant association credited its growing financial
relationship with SoCalGas to economic devastation the pandemic wrought upon restaurants.
Much of the money it received from the utility, it said, was used for business grants and worker
assistance.
The transition to all-electric restaurants has its challenges. But advocates and experts say SoCalGas
and the restaurant association fueled concerns with misinformation, masking them in the language
of social justice to undermine California's response to climate change.
In truth, an increasing number of chefs prefer to cook with electric appliances - woks included.
"Gas utilities are pushing a false narrative right now that electrification means the end of
restaurants," said Charlie Spatz, research manager at the Energy and Policy Institute. "This is
manufactured outrage and the National Restaurant Association and their affiliates have gone along
with it."
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SoCalGas allies with CRA
When Berkeley passed its first-in-the-nation ban on gas hookups for most new buildings in July
2019, the idea spread like a California wildfire. Dozens of cities began adopting similar measures,
posing a potential financial calamity for SoCalGas.
Pollution from heating, cooling, refrigerating and cooking in buildings make up California's third-
largest source of carbon emissions behind transportation and industry. Moving toward zero-
emission buildings is state policy, but progress has been slow.
In the last two decades, as emissions from transportation and in-state electricity generation fell by
well over 20%, pollution from residential buildings has remained mostly stagnant and increased by
51% in commercial buildings.
The California Restaurant Association (CRA) filed suit against Berkeley 's ban months later, arguing
that Berkeley 's ordinance overstepped federal energy law and that the policy would threaten key
cooking techniques.
A CRA press release announcing the lawsuit said restaurants "rely on gas for cooking particular
types of food, whether it be flame-seared meats, charred vegetables, or the use of intense heat
from a flame under a wok."
Immediately, environmental advocates suspected SoCalGas, the state-sanctioned monopoly utility,
was somehow involved.
Those advocates felt vindicated this April when the utility told state regulators it had mistakenly
billed customers $1.1 million for legal fees to the law firm used by the CRA to sue Berkeley.
Charging ratepayers for anything other than providing safe and reliable gas service - political
activities, for example - is a violation of state and federal law.
After the suit was filed, money from SoCalGas to the Redwood City law firm Reichman Jorgensen
began to flow. Records show that the utility had no financial relationship with the firm before 2019,
but paid the firm nearly $5 million between 2020 and 2022.
Representatives of SoCalGas said the money to Reichman Jorgensen was related to questions of
federal preemption, a legal question at the heart of the Berkeley case. But they deny any
connection to CRA's Berkeley lawsuit.
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"SoCalGas did not fund the Berkeley lawsuit," wrote SoCalGas spokesperson Alice Walton in an
email to The Sacramento Bee. "It is bogus to claim that SoCalGas is funding other parties' litigation
just because we use the same law firms."
The CRA also told The Bee there was no joint effort with SoCalGas on the lawsuit.
"We have not and do not coordinate with Southern California Gas on CRA litigation or legal
expenses," California Restaurant Association spokesperson Sharokina Shams said in a statement.
Yet it "it strains credibility to suggest that the utility did not fund research that supported the
California Restaurant Association's litigation," said the watchdog arm of the California Public
Utilities Commission, the utility 's regulator, in a filing this week.
In another sign of the growing partnership between the utility and restaurant industry group,
contributions to the CRA and its foundation from SoCalGas and Sempra, the utility 's parent
company, saw a dramatic upswing after CRA filed the lawsuit.
Contributions from Sempra and its subsidiaries SoCalGas and San Diego Gas & Electric grew from
$174,594 in years 2015 to 2018 to $1.8 million from 2019 to 2022, a tenfold increase.
Over half of this money went to the association's philanthropic arm, the California Restaurant
Association Foundation. The CRA said money to the foundation was spent on charitable activity
such as business grants, scholarships and youth culinary arts, and was "in no way related" to
legislative and other political advocacy.
The CRA's lawsuit against Berkeley turned out to be a stunning success, when a three-judge panel
of the 9th U.S. Circuit Court of Appeals ruled in the association's favor this April and struck down
Berkeley 's gas ban as preemptive of federal energy law.
At least 76 California cities had passed similar ordinances at the start of this year, but the ruling has
thrown cold water on the state's local building electrification push. Since April, no new cities have
taken up the issue and San Luis Obispo and Santa Cruz both suspended their rules.
States, cities and the Department of Energy now warn that the Berkeley ruling's wide definition of
preemption could threaten core state and local laws such as public safety power shut offs and
water conservation standards.
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The City of Berkeley and environmental advocates filed a petition in June for an en banc, or further
judicial review, of the decision.
"This lawsuit has the potential to be so consequential for clean energy and for climate action across
the country," said Sage Canchola-Welch, an environmental communications consultant. "It's almost
like they pulled a bunch of levers and accidentally hit the jackpot because a panel of judges made a
really radical decision."
Tokenizing woks and tortillas
From the beginning of its fight against burgeoning local gas bans, SoCalGas sought to recruit both
Asian and Latino-owned restaurants, businesses and community leaders as spokespeople to
advocate against electrification.
SoCalGas internal emails from 2019 show that utility executive Robert Cruz was actively recruiting
culinary leaders in predominately Chinese-American enclaves of the San Gabriel Valley as part of
the company 's Californians for Balanced Energy Solutions campaign.
The utility created the organization, also known as C4BES, to lobby government officials and state
agencies - much of it with customer money. It was exposed as a front group by the Sierra Club in
late 2019 and confirmed as such by the CPUC's watchdog arm.
In emails obtained by The Bee, Cruz sought community leaders to discuss "the impact of
electrification on the Asian business and restaurant community " with influential members of the
Chinese-American community in Los Angeles. "We need your help to get the word out," he wrote.
The email was to Samuel Kang, a City of Duarte Councilmember and of the group's strongest
recruits. He distributed pro-gas fliers translated into Mandarin, was featured in press conferences
and set SoCalGas executives up with key connections in the Chinese Chamber of Commerce.
"Can you help with this matter?" Kang asked Chester Chong, the chamber 's chairman in a June
2019 email. "Bob is from the Gas company and would like to speak with many more Asian
restaurant owners in regards to keeping the option of having natural gas as a fuel source."
Appearing at a Los Angeles meeting before the CPUC later that year, Kang testified against
electrifying buildings using talking points that had been provided to him by SoCalGas, emails show.
The Bee found that SoCalGas had paid the Los Angeles County Business Federation, or BizFed, to
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recruit "diverse" business owners and drive them to the meeting to advocate in favor of gas.
Attendees said the California Restaurant Association had also recruited business owners.
Regarding the contract, SoCalGas spokesperson Walton said, "The improper disclosure of a
standard outreach contract and other hand-picked materials from several years ago are part of an
ongoing effort by certain intervenors to misrepresent SoCalGas' public policy positions."
Chinese and other Asian community members weren't the only targets of this campaign. Emails
show Cruz told city officials in Pomona that he was "asked by (SoCalGas') leadership to identify
some key Latino leaders that might consider supporting" their campaign to preserve the use of gas.
Pacoima Beautiful, a clean air advocacy organization in the mostly Latino, low-income northeast
San Fernando Valley, reportedly stopped accepting SoCalGas donations after its leaders said the
group was reluctantly doing the company 's bidding.
When SoCalGas representatives urged them to reconsider, executive director Veronica Padilla told
the Los Angeles Times in 2020 that a utility representative discussing building electrification asked
her: "How are people going to warm up their tortillas?"
"That was so disturbing to me," Padilla said to the Times about the conversation.
By 2021, on a recorded leadership call, American Gas Association executive Susan Forrester said
the industry needed to reach out to restaurants, among other groups, "so that we have more
friends on our side willing to talk about how great natural gas is."
The utility did not respond to a question about why its C4BES campaign specifically recruited
members of these communities for its political activities.
Yet numerous advocates told The Bee that SoCalGas was plainly targeting Asian and Latino
Californians as an effective political tactic. The environment is an important consideration for many
of the state's left-leaning local elected officials and regulators, but so is appearing sensitive to the
concerns of communities of color.
"It's laughable for SoCalGas to pretend they 're looking out for working class people of color. Oil
and gas executives have no problem polluting the air and water of frontline communities across
the state," said Amee Raval, policy and research director of the Asian Pacific Environmental
Network. "Then they turn around and use our families to defend their profits? It's astroturfing 101."
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Discrediting the science
As the industry 's recruitment of spokespeople aimed to stem the tide of local gas bans, SoCalGas
faced another obstacle: Mounting research that revealed the harmful health effects of gas stoves.
In spring 2020, UCLA scientists published findings that nitrogen oxides emitted by gas stoves inside
the home can cause respiratory symptoms such as asthma, particularly in children, with effects felt
in smaller households that lack proper ventilation.
A recently published Stanford University study also found that gas cooking appliances can raise
indoor levels of benzene, a carcinogen, above those foundin secondhand tobacco smoke. Low
income and communities of color with more crowded living conditions are especially vulnerable.
Both SoCalGas and the California restaurant association have sponsored studies attempting to
debunk those findings.
In 2020, the utility paid Danish based energy consulting firm Ramboll with customer money for an
analysis it presented to the California Energy Commission in favor of preserving gas appliances.
The company told The Bee that it wouldn't disclose how much ratepayer money was used, calling
the process confidential.
Ramboll later changed its tune, announcing last year it would no longer work on gas and oil
projects. But the research for SoCalGas contained many of the same talking points as studies
published by the restaurant association shortly thereafter.
In 2021 and 2022, the association funded and promoted two non peer-reviewed but widely
circulated studies to cast doubt on the growing research. One pointed to potential holes in the
UCLA study, and another argued that research has found that indoor air pollution is more
dependent on the food being cooked than the fuel used to cook it.
They were conducted by Dan Tormey, a consultant whose industry-funded studies once promoted
the safety of urban oil and gas exploration in Los Angeles. Several studies showing serious health
impacts led the county to ban new urban drilling activities last year.
Those studies - highlighted in conservative media - have helped turned the gas stove debate into a
political culture war on the national stage. In response to potentially stricter federal regulations of
gas appliances, Ohio Republican Rep. Jim Jordan tweeted "God, guns and gas stoves."
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Rob Jackson, leading researcher on the health impacts of gas stoves at the Stanford Doerr School of
Sustainability, said his work measuring stove emissions in dozens of homes led him to believe that
health advantages of removing gas cooking appliances are as important as the climate benefits.
"I don't see what the Restaurant Association does as science. I see what they 're doing as a
combination of commentary and influencing," he said. "Is everyone at risk? I don't think so. But
there are millions of people in the United States who are. Dismissing the risks to those people
based on some ideal scenario that someone creates is dangerous."
The CRA defended its research papers against Jackson's criticism.
"Each of the two papers published on the CRA website review multiple studies on various related
issues in support of the statements made," said Shams, the CRA spokesperson, in a statement.
Charlie Spatz from the Energy and Policy Institute said the CRA's studies are reminiscent of research
performed by the hospitality industry between the 1960s and 1980s that sought to debunk health
concerns from cigarettes.
"Gas utilities have turned to the old tobacco playbook to counter the policies that are threatening
their business operations," Spatz said.
"Historically, tobacco companies faced an existential threat as local policies emerged to restrict
their product. They turned to groups like the National Restaurant Association to fight back, and
now we're seeing the gas utilities turn to the same exact strategy."
Electrification in Sacramento
Frank Fat's Chinese restaurant in downtown Sacramento has a reputation for excellent honey
walnut shrimp, and for politics. Tobacco lobbyists famously struck a historic deal with state
lawmakers on the back of one of its napkins 35 years ago.
As recently as last year, SoCalGas legislative staff were holding private lunches in the eatery 's event
room. The utility 's messaging soon appeared in discussions of an otherwise straightforward climate
ordinance in city meetings.
The eatery 's second generation owner Kevin Fat, then Sacramento chapter president of the
California Restaurant Association, emerged as a key defender of gas stoves as the city considered a
plan to turn new buildings electric.
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He worked with CRA lobbyist Matt Sutton, Fat and two other local Chinese restaurant business
leaders - retired chef David Soohoo and Stockton Boulevard Partnership Executive Director Frank
Louie - to rally in favor of keeping gas in restaurants.
At city meetings, in the press and to elected officials directly, the group said that taking gas out of
new buildings would put the Sacramento's beloved Chinese and other Asian restaurants out of
business, and thousands of years of culture were at stake.
They often said wok hei, the "breath of the wok" in Cantonese, which imparts a distinct kissed-by-
fire flavor flavor to food when cooked at high temperatures often compared to the Maillard
reaction, can't be achieved on electric cookware.
"This is our family 's business that we've been in for 84years, the style of cooking has been around
for thousands of years," Fat told The Bee. "We felt we needed to protect our culture. We need to
protect the way we cook. And that was our only goal in mind."
Fat said it would be unfair for Asian restaurants that wanted to use gas be relegated only to existing
buildings, though The Bee could not find a case of a new Sacramento building with or considering a
new Chinese or other Asian restaurant at the time.
An initial version of the ordinance in passed in June 2021 would have required new buildings to be
all-electric by 2026. After frequent media appearances and lobbying, Sacramento city staff put Fat,
Soohoo and Louie on an influential technical advisory committee.
With their input, the city issued an update to the ordinance late last year that included significant
exemptions and an infeasibility waiver process. Any developer with a restaurant or commercial
kitchen on the bottom floor can now claim a socio-cultural conflict with electrification and apply to
continue using gas indefinitely.
"We kind of told the city in so many words, working with Jennifer Venema and saying 'let's slow this
train down,'" said Louie. "We were able to work with staff to insert a key component that will allow
us to continue to use gas if the technology is not readily available or feasible."
Fat, Soohoo and Louie have all said they advocated on their own behalf and were not influenced by
SoCalGas or the CRA.
The arguments of CRA and affiliated restaurateurs are not without merit. An industry-wide shift to
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induction cooking would be challenging for restaurant owners running on thin margins, and
shifting long-held cooking methods requires training.
Their reasoning has resonated in opposition to gas bans in communities across California, mainly
from business associations and industry groups. The vast majority of local ordinances in the state
include carve outs for restaurants and commercial kitchens, according to the Sierra Club.
Retired chef Soohoo became a de-facto spokesperson for this campaign in Sacramento, made
evident by text messages with city councilwoman Katie Valenzuela that she shared with The Bee.
He appeared to have motives beyond protecting his cultural cuisine.
In an interview with The Bee, Soohoo shared his belief that radiation makes induction cooking
dangerous, which is unsupported by science. He also acknowledged his hopes of a business
arrangement with SoCalGas.
Soohoo, whose family owned a wok manufacturing company that closed during the pandemic, said
he designed a hydrogen-powered wok range that he aimed to pitch the company as an investment
opportunity. He traveled in January to southern California at the expense of SoCalGas to perform a
wok cooking demonstration at a utility facility.
"As one who has cooked with woks and is an expert, NO STIR FRY ELECTRIC WOK WILL BE
AVAILABLE IN 2026," Soohoo told Valenzuela in one text.
Valenzuela, a local politician and policy advocate attuned to the needs of low-income communities
of color, said in retrospect she feels somewhat taken in by CRA and that she did not understand the
spectrum of connections between Soohoo's arguments and those of SoCalGas.
"It sucks when people aren't transparent," Valenzuela said. "The real issue is, who do you trust?
Fossil fuel groups with unlimited cash to spend have shown that they are adept at masking their
interest in topics of genuine concern for someone like me, like cultural sensitivity and racial justice."
Responding to Valenzuela's comments, Soohoo downplayed his connection with SoCalGas and
stressed that he did not have an existing business relationship with the utility to test a hydrogen
wok - only a hope to do so.
Induction stir fry
What SoCalGas and the restaurant association have asserted about cooking with gas is not
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universally accepted by the wider culinary world. A growing number of professional chefs prefer
electric kitchens - woks included.
Induction stovetops create electric currents in a pan with a magnetic field, cooking food in a
fraction of the time for a fraction of the energy. Proponents say the appliances are safer and easier
to clean.
Research shows that electric kitchens are also healthier for workers, but cost remains a major
issue. On average, an induction stove costs $600 more than a gas range.
High costs will make the transition away from gas difficult, admitted Chef Tu David Phu. But the
Oakland-born, Vietnamese-American star of "Top Chef " said climate change is simply too large a
threat not to make it.
Equitable decarbonization will require government subsidies and incentives, Phu said, so benefits
aren't limited to wealthy but rather shared across renters and small businesses including
restaurants. He highlighted all-electric kitchens in Vietnam as an example.
"They 've been able to move forward with culture, tradition and heritage in a pretty economical
sustainable way for everyone," he said. "This is beyond tradition and heritage. It's about what's left
for tomorrow and for future generations."
Celebrity chef Martin Yan, a lecturer at UC Davis in food science and host of long-running PBS show
"Yan Can Cook," said he is sensitive to peers' concerns about induction cooking, but compared their
resistance to early days of the electric vehicle market.
Strong regulations, investment and time will bring affordable options to the U.S., Yang said. He also
frequents Hong Kong cooking competitions where induction cooking is ubiquitous.
"They all use it," Yan said of the induction wok. "And I tell you, there's no difference."
Ed Roehr, chef and owner of Magpie Café in midtown Sacramento, said all-electric kitchens are
some of the most desirable appliances on the market. As the debate continues, the California
Restaurant Association is not the voice for all eateries.
"I don't think that all restaurateurs want to choose the most polluting path," Roehr said. "And I
think many would be excited to be a part of something that made a material contribution to
changing the threats to global climate change."
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Climate advocates lament SoCalGas and the restaurant association's success in their fight against
building electrification. That said, recent regulations and incentives make them optimistic about
zero-emissions buildings long term.
How fast that transition happens is the question, said Merrian Borgeson, director of California
climate and energy programs at the National Resources Defense Council. And an important turning
point in the state's war over gas stoves lays ahead.
The California Air Resources Board is considering a regulation that would ban the sale of all new
gas appliances starting in 2030. The rule would allow only the sale of zero-emission appliances.
SoCalGas now says it is committed to decarbonization by switching to low-emission sources such
as renewable natural gas and hydrogen. But many advocates are bracing for the utility and other
gas companies to continue fighting any form of a gas ban.
"I hope it's not a fight, but we're not done by any means," Borgeson said. "If we are agreeing on
where we need to go, we can have a constructive conversation and how to get there. If we're still in
denial, we have more work to do."
Ari Plachta: 916-321-1374, @AriPlachta
Joe Rubin: 916-321-1006
Coming Monday:
SoCalGas, the nation's largest gas company, has diverted millions in customer dollars to lobby for
gas in homes and buildings, undermining California policies aimed at addressing the climate crisis.
Gas utilities are pushing a false narrative right now that electrification means the end of
restaurants. This is manufactured outrage and
the National Restaurant Association and their affiliates have gone along with it.
Charlie Spatz, research manager at the Energy and Policy Institute
It's laughable
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for SoCalGas to pretend they 're looking out for working class people of color. Oil and gas
executives have no problem polluting the
air and water
of frontline communities across the state. Then they turn around and use our families to defend
their profits? It's astroturfing 101.
Amee Raval, policy and research director of the Asian Pacific Environmental Network
Copyright (c) 2023 The Sacramento Bee
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Emails show restaurant group's efforts in - Sacramento Bee, The (CA) - August 26, 2023 - page 1A
August 26, 2023 | Sacramento Bee, The (CA) | Joe Rubin and Ari Plachta; Staff Writer | Page 1A
More than 1,400 pages of emails newly obtained by The Sacramento Bee further reveal the efforts
by the California Restaurant Association to water down the city of Sacramento's climate change
proposal to require new buildings be powered by electricity.
Those efforts, detailed in a recent Sacramento Bee investigation, are also now drawing scrutiny
from Sacramento Mayor Darrell Steinberg and Councilwoman Katie Valenzuela.
Pollution from heating, cooling, refrigerating and cooking in buildings make up California's third-
largest source of carbon emissions behind transportation and industry. Sacramento is among the
many California cities that has sought to move away from gas-powered buildings - a move opposed
by the restaurant association as well as the nation's largest gas utility, SoCalGas.
The recent Bee investigation noted that contributions to the Sacramento-based restaurant
association and its foundation from Sempra and its subsidiaries SoCalGas and San Diego Gas &
Electric grew from $174,594 in years 2015 to 2018 to $1.8 million from 2019 to 2022 - a tenfold
increase.
The CRA successfully sued to overturn a gas ban in Berkeley and also strongly opposed a similar
proposal in Sacramento in 2021. The association told The Bee that none of its efforts were in
coordination with SoCalGas, and that its opposition was rooted in protecting cultural cooking
traditions, particularly the use of gas-powered woks.
In Sacramento, one of CRA's vice presidents Matthew Sutton was named to a council technical
advisory committee that also included Kevin Fat, owner of Frank Fat's restaurant and then-
Sacramento chapter president of the California Restaurant Association, as well as retired chef David
Soohoo and Stockton Boulevard Partnership Executive Director Frank Louie.
Ultimately, that technical committee successfully lobbied for a change in the ordinance that
included significant exemptions. Any developer with a restaurant or commercial kitchen on the
bottom floor can now claim a socio-cultural conflict with electrification and apply to continue using
gas indefinitely.
What the emails show
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The emails obtained by The Bee show that Sutton set up meetings between city staff and Fat,
Soohoo and Louie.
"If you could provide some dates and times that work over the next few weeks," said one Sutton
email to city staff, "we will herd our cats for a productive discussion."
Fat, the second-generation owner of the legendary and politically influential Frank Fat's, said in
another email that "our industry provides the most jobs and sales tax revenue in the city and state.
To add the electrification ordinance simply adds an additional burden to an already burdensome
and in all honesty, hostile business environment."
Previous text messages from Soohoo obtained by The Bee accused the city 's electrification effort of
being racist. The newly obtained emails add to a sense of an at times confrontational presence.
"The electrification ordinance will create havoc on our Hmong and Southeast Asian people in
Sacramento," Soohoo said in an email to city staff. "Many believe that they eat dogs and are short
stocky mountain people who should not come here. There will be about 500 wok kitchen worried
as to what you all decide to do..... The application alone will push the younger Asian kids to go to
pot and other embarrassing jobs for Sacramento parents."
Fat, Soohoo and Louie all told The Bee they were acting on their own behalf and were not
influenced by the CRA or SoCalGas.
City reaction
Nevertheless, at Tuesday 's Sacramento City Council meeting, Steinberg and Valenzuela expressed
concern over the process.
During a staff presentation on the city 's proposed climate action and adaptation plan, they called
for greater transparency in the electrification process and a review of conflict of interest standards.
Steinberg commented that The Bee investigation raised concerns about "influences from Southern
California connected to some of our local advocates, trying to kill, frankly, at least some portion of
the electrification ordinance."
Steinberg added, that the makeup of technical advisory committees "deserves a thorough looking
into so that we can make sure we're doing the right thing."
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Valenzuela said some kind of review of conflict of interest standards with advisory committees is
necessary.
"It's really important as we move forward," she said, "that we think about what does conflict of
interest policies and ethics policies look like for committees like this."
In an email to The Bee, Sutton defended his role on the technical committee.
"When government agencies seek technical expertise in an issue area, " he wrote, "we make every
effort to provide it, and frankly, it would be inappropriate for policymakers to move forward
without that knowledge
"Cities and other regulatory agencies are correct to invite trade associations to apply to advisory
posts. Not only can we provide expertise, we can connect cities to local restaurants. Without this
insight, elected leaders would be making public policy decisions without knowing how a new
regulation will impact an entire industry."
Ari Plachta: 916-321-1374, @AriPlachta
Joe Rubin: 916-321-1006
Copyright (c) 2023 The Sacramento Bee
9/19/23, 12:52 PM SoCalGas spends millions to fight bans on restaurant gas use | The Sacramento Bee
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Woks vs. clean energy? SoCalGas wanted
you to think electri cation would crush
California restaurants
BY ARI PLACHTA AND JOE RUBIN
UPDATED AUGUST 23, 2023 7:42 AM
Part of the McClatchy Media Network
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When Sacramento wanted to ban gas hookups in new buildings two years ago, it
sparked a passionate debate over an unexpected cooking tool: the wok.
Restaurateurs argued that cooking a traditional Chinese stir fry is simply impossible
without an open ame.
But the dispute wasn’t merely about serving delicious meals to hungry customers. It
was also about the bottom line of the nation’s largest gas company, SoCalGas, which
serves 21 million customers as far north as Fresno and along the Central Coast.
As California cities began to cut planet-warming pollution in new buildings,
SoCalGas spent millions to slow the push for building electri cation. The
Sacramento-based California Restaurant Association became a key ally in this e ort,
receiving an in ux of funding from the utility and bringing a lawsuit that could now
hamper clean energy policies nationwide.
Gas stoves and cherished cooking traditions were at the center of this campaign.
After SoCalGas recruited primarily Asian-American community and culinary leaders
as pro-gas spokespeople, the restaurant association funded widely circulated
research that scientists describe as misleading and helped weaken Sacramento’s
own electri cation ordinance.
In statements to The Sacramento Bee, the restaurant association credited its growing
nancial relationship with SoCalGas to economic devastation the pandemic wrought
upon restaurants. Much of the money it received from the utility, it said, was used
for business grants and worker assistance.
The transition to all-electric restaurants has its challenges. But advocates and
experts say SoCalGas and the restaurant association fueled concerns with
misinformation, masking them in the language of social justice to undermine
California’s response to climate change.
In truth, an increasing number of chefs prefer to cook with electric appliances —
woks included.
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“Gas utilities are pushing a false narrative right now that electri cation means the
end of restaurants,” said Charlie Spatz, research manager at the Energy and Policy
Institute. “This is manufactured outrage and the National Restaurant Association
and their a liates have gone along with it.”
SOCALGAS ALLIES WITH CRA
When Berkeley passed its rst-in-the-nation ban on gas hookups for most new
buildings in July 2019, the idea spread like a California wild re. Dozens of cities
began adopting similar measures, posing a potential nancial calamity for SoCalGas.
Pollution from heating, cooling, refrigerating and cooking in buildings make up
California’s third-largest source of carbon emissions behind transportation and
industry. Moving toward zero-emission buildings is state policy, but progress has
been slow.
In the last two decades, as emissions from transportation and in-state electricity
generation fell by well over 20%, pollution from residential buildings has remained
mostly stagnant and increased by 51% in commercial buildings.
The California Restaurant Association (CRA) led suit against Berkeley’s ban months
later, arguing that Berkeley’s ordinance overstepped federal energy law and that the
policy would threaten key cooking techniques.
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A CRA press release announcing the lawsuit said restaurants “rely on gas for cooking
particular types of food, whether it be ame-seared meats, charred vegetables, or
the use of intense heat from a ame under a wok.”
Immediately, environmental advocates suspected SoCalGas, the state-sanctioned
monopoly utility, was somehow involved.
Those advocates felt vindicated this April when the utility told state regulators it had
mistakenly billed customers $1.1 million for legal fees to the law rm used by the
CRA to sue Berkeley. Charging ratepayers for anything other than providing safe and
reliable gas service — political activities, for example — is a violation of state and
federal law.
After the suit was led, money from SoCalGas to the Redwood City law rm
Reichman Jorgensen began to ow. Records show that the utility had no nancial
relationship with the rm before 2019, but paid the rm nearly $5 million between
2020 and 2022.
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Representatives of SoCalGas said the money to Reichman Jorgensen was related to
questions of federal preemption, a legal question at the heart of the Berkeley case.
But they deny any connection to CRA’s Berkeley lawsuit.
“SoCalGas did not fund the Berkeley lawsuit,” wrote SoCalGas spokesperson Alice
Walton in an email to The Sacramento Bee. “It is bogus to claim that SoCalGas is
funding other parties’ litigation just because we use the same law rms.”
The CRA also told The Bee there was no joint e ort with SoCalGas on the lawsuit.
“We have not and do not coordinate with Southern California Gas on CRA litigation
or legal expenses,” California Restaurant Association spokesperson Sharokina Shams
said in a statement.
Yet it “it strains credibility to suggest that the utility did not fund research that
supported the California Restaurant Association’s litigation,” said the watchdog arm
of the California Public Utilities Commission, the utility’s regulator, in a ling this
week.
The Gas Company tower, center, in downtown Los Angeles is the headquarters of SoCalGas, which teamed up with the California Restaurant
Association to combat electri cation in Sacramento. Irfan Khan Los Angeles Times via TNS
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In another sign of the growing partnership between the utility and restaurant
industry group, contributions to the CRA and its foundation from SoCalGas and
Sempra, the utility’s parent company, saw a dramatic upswing after CRA led the
lawsuit.
Contributions from Sempra and its subsidiaries SoCalGas and San Diego Gas &
Electric grew from $174,594 in years 2015 to 2018 to $1.8 million from 2019 to 2022,
a tenfold increase.
Chart: Ellie Lin/Sacramento Bee • Get the data
Sempra contributions to the California Restaurant Association
Sempra, SoCalGas and SDG&E contributed $1.8 million to the CRA and its foundation between 2019 and 2021, a
tenfold increase from years prior.
2015 2016 2017 2018 2019 2020 2021 2022
0
200K
400K
600K
CRAFCRAF CRACRA
Over half of this money went to the association’s philanthropic arm, the California
Restaurant Association Foundation. The CRA said money to the foundation was spent
on charitable activity such as business grants, scholarships and youth culinary arts,
and was “in no way related” to legislative and other political advocacy.
The CRA’s lawsuit against Berkeley turned out to be a stunning success, when a
three-judge panel of the 9th U.S. Circuit Court of Appeals ruled in the association’s
favor this April and struck down Berkeley’s gas ban as preemptive of federal energy
law.
At least 76 California cities had passed similar ordinances at the start of this year, but
the ruling has thrown cold water on the state’s local building electri cation push.
Since April, no new cities have taken up the issue and San Luis Obispo and Santa
Cruz both suspended their rules.
States, cities and the Department of Energy now warn that the Berkeley ruling’s wide
de nition of preemption could threaten core state and local laws such as public
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safety power shut o s and water conservation standards.
The City of Berkeley and environmental advocates led a petition in June for an en
banc, or further judicial review, of the decision.
“This lawsuit has the potential to be so consequential for clean energy and for
climate action across the country,” said Sage Canchola-Welch, an environmental
communications consultant. “It’s almost like they pulled a bunch of levers and
accidentally hit the jackpot because a panel of judges made a really radical
decision.”
TOKENIZING WOKS AND TORTILLAS
From the beginning of its ght against burgeoning local gas bans, SoCalGas sought to
recruit both Asian and Latino-owned restaurants, businesses and community
leaders as spokespeople to advocate against electri cation.
SoCalGas internal emails from 2019 show that utility executive Robert Cruz was
actively recruiting culinary leaders in predominately Chinese-American enclaves of
the San Gabriel Valley as part of the company’s Californians for Balanced Energy
Solutions campaign.
The utility created the organization, also known as C4BES, to lobby government
o cials and state agencies — much of it with customer money. It was exposed as a
front group by the Sierra Club in late 2019 and con rmed as such by the CPUC’s
watchdog arm.
In emails obtained by The Bee, Cruz sought community leaders to discuss “the
impact of electri cation on the Asian business and restaurant community” with
in uential members of the Chinese-American community in Los Angeles. “We need
your help to get the word out,” he wrote.
The email was to Samuel Kang, a City of Duarte Councilmember and of the group’s
strongest recruits. He distributed pro-gas iers translated into Mandarin, was
featured in press conferences and set SoCalGas executives up with key connections
in the Chinese Chamber of Commerce.
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“Can you help with this matter?” Kang asked Chester Chong, the chamber ’s
chairman in a June 2019 email. “Bob is from the Gas company and would like to
speak with many more Asian restaurant owners in regards to keeping the option of
having natural gas as a fuel source.”
Appearing at a Los Angeles meeting before the CPUC later that year, Kang testi ed
against electrifying buildings using talking points that had been provided to him by
SoCalGas, emails show.
The Bee found that SoCalGas had paid the Los Angeles County Business Federation,
or BizFed, to recruit “diverse” business owners and drive them to the meeting to
advocate in favor of gas. Attendees said the California Restaurant Association had
also recruited business owners.
Regarding the contract, SoCalGas spokesperson Walton said, “The improper
disclosure of a standard outreach contract and other hand-picked materials from
several years ago are part of an ongoing e ort by certain intervenors to
misrepresent SoCalGas’ public policy positions.”
Chinese and other Asian community members weren’t the only targets of this
campaign. Emails show Cruz told city o cials in Pomona that he was “asked by
(SoCalGas’) leadership to identify some key Latino leaders that might consider
supporting” their campaign to preserve the use of gas.
Pacoima Beautiful, a clean air advocacy organization in the mostly Latino, low-
income northeast San Fernando Valley, reportedly stopped accepting SoCalGas
donations after its leaders said the group was reluctantly doing the company’s
bidding.
When SoCalGas representatives urged them to reconsider, executive director
Veronica Padilla told the Los Angeles Times in 2020 that a utility representative
discussing building electri cation asked her: “How are people going to warm up
their tortillas?”
“That was so disturbing to me,” Padilla said to the Times about the conversation.
By 2021, on a recorded leadership call, American Gas Association executive Susan
Forrester said the industry needed to reach out to restaurants, among other groups,
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“so that we have more friends on our side willing to talk about how great natural gas
is.”
The utility did not respond to a question about why its C4BES campaign speci cally
recruited members of these communities for its political activities.
Yet numerous advocates told The Bee that SoCalGas was plainly targeting Asian and
Latino Californians as an e ective political tactic. The environment is an important
consideration for many of the state’s left-leaning local elected o cials and
regulators, but so is appearing sensitive to the concerns of communities of color.
“It’s laughable for SoCalGas to pretend they’re looking out for working class people
of color. Oil and gas executives have no problem polluting the air and water of
frontline communities across the state,” said Amee Raval, policy and research
director of the Asian Paci c Environmental Network. “Then they turn around and
use our families to defend their pro ts? It’s astrotur ng 101.”
DISCREDITING THE SCIENCE
As the industry’s recruitment of spokespeople aimed to stem the tide of local gas
bans, SoCalGas faced another obstacle: Mounting research that revealed the harmful
health e ects of gas stoves.
In spring 2020, UCLA scientists published ndings that nitrogen oxides emitted by
gas stoves inside the home can cause respiratory symptoms such as asthma,
particularly in children, with e ects felt in smaller households that lack proper
ventilation.
A recently published Stanford University study also found that gas cooking
appliances can raise indoor levels of benzene, a carcinogen, above those found in
secondhand tobacco smoke. Low income and communities of color with more
crowded living conditions are especially vulnerable.
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Both SoCalGas and the California restaurant association have sponsored studies
attempting to debunk those ndings.
In 2020, the utility paid Danish based energy consulting rm Ramboll with customer
money for an analysis it presented to the California Energy Commission in favor of
preserving gas appliances. The company told The Bee that it wouldn’t disclose how
much ratepayer money was used, calling the process con dential.
Ramboll later changed its tune, announcing last year it would no longer work on gas
and oil projects. But the research for SoCalGas contained many of the same talking
points as studies published by the restaurant association shortly thereafter.
In 2021 and 2022, the association funded and promoted two non peer-reviewed but
widely circulated studies to cast doubt on the growing research. One pointed to
potential holes in the UCLA study, and another argued that research has found that
indoor air pollution is more dependent on the food being cooked than the fuel used
to cook it.
Recent research from Stanford and UCLA has found that gas cooking appliances can have harmful health impacts at home. Myung J. Chun Los
Angeles Times via TNS
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They were conducted by Dan Tormey, a consultant whose industry-funded studies
once promoted the safety of urban oil and gas exploration in Los Angeles. Several
studies showing serious health impacts led the county to ban new urban drilling
activities last year.
Those studies — highlighted in conservative media — have helped turned the gas
stove debate into a political culture war on the national stage. In response to
potentially stricter federal regulations of gas appliances, Ohio Republican Rep. Jim
Jordan tweeted “God, guns and gas stoves.”
Rob Jackson, leading researcher on the health impacts of gas stoves at the Stanford
Doerr School of Sustainability, said his work measuring stove emissions in dozens of
homes led him to believe that health advantages of removing gas cooking appliances
are as important as the climate bene ts.
“I don’t see what the Restaurant Association does as science. I see what they’re doing
as a combination of commentary and in uencing,” he said. “Is everyone at risk? I
don’t think so. But there are millions of people in the United States who are.
Dismissing the risks to those people based on some ideal scenario that someone
creates is dangerous.”
The CRA defended its research papers against Jackson’s criticism.
“Each of the two papers published on the CRA website review multiple studies on
various related issues in support of the statements made,” said Shams, the CRA
spokesperson, in a statement.
Charlie Spatz from the Energy and Policy Institute said the CRA’s studies are
reminiscent of research performed by the hospitality industry between the 1960s
and 1980s that sought to debunk health concerns from cigarettes.
“Gas utilities have turned to the old tobacco playbook to counter the policies that are
threatening their business operations,” Spatz said.
“Historically, tobacco companies faced an existential threat as local policies emerged
to restrict their product. They turned to groups like the National Restaurant
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Association to ght back, and now we’re seeing the gas utilities turn to the same
exact strategy.”
ELECTRIFICATION IN SACRAMENTO
Frank Fat’s Chinese restaurant in downtown Sacramento has a reputation for
excellent honey walnut shrimp, and for politics. Tobacco lobbyists famously struck a
historic deal with state lawmakers on the back of one of its napkins 35 years ago.
As recently as last year, SoCalGas legislative sta were holding private lunches in the
eatery’s event room. The utility’s messaging soon appeared in discussions of an
otherwise straightforward climate ordinance in city meetings.
The eatery’s second generation owner Kevin Fat, then Sacramento chapter president
of the California Restaurant Association, emerged as a key defender of gas stoves as
the city considered a plan to turn new buildings electric.
He worked with CRA lobbyist Matt Sutton, Fat and two other local Chinese
restaurant business leaders — retired chef David Soohoo and Stockton Boulevard
Kevin Fat, CEO of the Fat Family Restaurant Group, stands in May at the bar in Frank Fat’s, the restaurant his grandfather opened in 1939. Fat
helped create a process to create a socio-cultural exemption from Sacramento’s ban on gas service to new buildings. Paul Kitagaki Jr.
pkitagaki@sacbee.com
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Partnership Executive Director Frank Louie — to rally in favor of keeping gas in
restaurants.
At city meetings, in the press and to elected o cials directly, the group said that
taking gas out of new buildings would put the Sacramento’s beloved Chinese and
other Asian restaurants out of business, and thousands of years of culture were at
stake.
They often said wok hei, the “breath of the wok” in Cantonese, which imparts a
distinct kissed-by- re avor avor to food when cooked at high temperatures often
compared to the Maillard reaction, can’t be achieved on electric cookware.
“This is our family’s business that we’ve been in for 84 years, the style of cooking has
been around for thousands of years,” Fat told The Bee. “We felt we needed to protect
our culture. We need to protect the way we cook. And that was our only goal in
mind.”
The ame of a gas stove ares up the side of a wok as chef Quan Sun cooks Chinese cuisine at Frank Fats in downtown Sacramento in May.
Paul Kitagaki Jr. pkitagaki@sacbee.com
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Fat said it would be unfair for Asian restaurants that wanted to use gas be relegated
only to existing buildings, though The Bee could not nd a case of a new Sacramento
building with or considering a new Chinese or other Asian restaurant at the time.
An initial version of the ordinance in passed in June 2021 would have required new
buildings to be all-electric by 2026. After frequent media appearances and lobbying,
Sacramento city sta put Fat, Soohoo and Louie on an in uential technical advisory
committee.
With their input, the city issued an update to the ordinance late last year that
included signi cant exemptions and an infeasibility waiver process. Any developer
with a restaurant or commercial kitchen on the bottom oor can now claim a socio-
cultural con ict with electri cation and apply to continue using gas inde nitely.
“We kind of told the city in so many words, working with Jennifer Venema and
saying ‘let’s slow this train down,’” said Louie. “We were able to work with sta to
insert a key component that will allow us to continue to use gas if the technology is
not readily available or feasible.”
Fat, Soohoo and Louie have all said they advocated on their own behalf and were
not in uenced by SoCalGas or the CRA.
The arguments of CRA and a liated restaurateurs are not without merit. An
industry-wide shift to induction cooking would be challenging for restaurant owners
running on thin margins, and shifting long-held cooking methods requires training.
Their reasoning has resonated in opposition to gas bans in communities across
California, mainly from business associations and industry groups. The vast majority
of local ordinances in the state include carve outs for restaurants and commercial
kitchens, according to the Sierra Club.
Retired chef Soohoo became a de-facto spokesperson for this campaign in
Sacramento, made evident by text messages with city councilwoman Katie
Valenzuela that she shared with The Bee. He appeared to have motives beyond
protecting his cultural cuisine.
In an interview with The Bee, Soohoo shared his belief that radiation makes
induction cooking dangerous, which is unsupported by science. He also
acknowledged his hopes of a business arrangement with SoCalGas.
Soohoo, whose family owned a wok manufacturing company that closed during the
pandemic, said he designed a hydrogen-powered wok range that he aimed to pitch
the company as an investment opportunity. He traveled in January to southern
California at the expense of SoCalGas to perform a wok cooking demonstration at a
utility facility.
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“As one who has cooked with woks and is an expert, NO STIR FRY ELECTRIC WOK
WILL BE AVAILABLE IN 2026,” Soohoo told Valenzuela in one text.
Valenzuela, a local politician and policy advocate attuned to the needs of low-income
communities of color, said in retrospect she feels somewhat taken in by CRA and that
she did not understand the spectrum of connections between Soohoo’s arguments
and those of SoCalGas.
“It sucks when people aren’t transparent,” Valenzuela said. “The real issue is, who do
you trust? Fossil fuel groups with unlimited cash to spend have shown that they are
adept at masking their interest in topics of genuine concern for someone like me,
like cultural sensitivity and racial justice.”
Responding to Valenzuela’s comments, Soohoo downplayed his connection with
SoCalGas and stressed that he did not have an existing business relationship with the
utility to test a hydrogen wok — only a hope to do so.
INDUCTION STIR FRY
What SoCalGas and the restaurant association have asserted about cooking with gas
is not universally accepted by the wider culinary world. A growing number of
professional chefs prefer electric kitchens — woks included.
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An induction cooktop contains a coil, often made from copper.
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When the power is on, an alternating current passes through the coil. This
produces a dynamic electromagnetic eld, which has a rapidly changing
direction. No heat is produced unless the pan is made of a magnetic material
that reacts with the electromagnetic eld.
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When a magnetic pan is placed near the coil, eddy currents are induced. Eddy
currents heat the metal of the wok, which in turn, heats the content of the wok.
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The rst patents for wok-compatible induction cooktops were led in the 1990s.
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The design of a wok induction cooktop features one key di erence from a
regular induction stovetop: a glass or ceramic concave surface that can balance
the round bottom of a wok, rather than a at one for a at-bottomed pan.
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Induction stovetops create electric currents in a pan with a magnetic eld, cooking
food in a fraction of the time for a fraction of the energy. Proponents say the
appliances are safer and easier to clean.
Research shows that electric kitchens are also healthier for workers, but cost
remains a major issue. On average, an induction stove costs $600 more than a gas
range.
High costs will make the transition away from gas di cult, admitted Chef Tu David
Phu. But the Oakland-born, Vietnamese-American star of “Top Chef ” said climate
change is simply too large a threat not to make it.
Equitable decarbonization will require government subsidies and incentives, Phu
said, so bene ts aren’t limited to wealthy but rather shared across renters and small
businesses including restaurants. He highlighted all-electric kitchens in Vietnam as
an example.
“They’ve been able to move forward with culture, tradition and heritage in a pretty
economical sustainable way for everyone,” he said. “This is beyond tradition and
heritage. It’s about what’s left for tomorrow and for future generations.”
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Celebrity chef Martin Yan, a lecturer at UC Davis in food science and host of long-
running PBS show ”Yan Can Cook,” said he is sensitive to peers’ concerns about
induction cooking, but compared their resistance to early days of the electric vehicle
market.
Strong regulations, investment and time will bring a ordable options to the U.S.,
Yang said. He also frequents Hong Kong cooking competitions where induction
cooking is ubiquitous.
“They all use it,” Yan said of the induction wok. “And I tell you, there’s no di erence.”
Ed Roehr, chef and owner of Magpie Café in midtown Sacramento, said all-electric
kitchens are some of the most desirable appliances on the market. As the debate
continues, the California Restaurant Association is not the voice for all eateries.
“I don’t think that all restaurateurs want to choose the most polluting path,” Roehr
said. “And I think many would be excited to be a part of something that made a
material contribution to changing the threats to global climate change.”
Chef Tu David Phu, an Oakland-born Vietnamese American who was featured on season 15 of the Bravo Network’s “Top Chef,” cooks a noodle
dish on an induction stove during a demonstration at the Leland Stanford Mansion in downtown Sacramento in June. Paul Kitagaki Jr.
pkitagaki@sacbee.com
9/19/23, 12:52 PM SoCalGas spends millions to fight bans on restaurant gas use | The Sacramento Bee
https://www.sacbee.com/news/politics-government/capitol-alert/article277266813.html 26/27
Climate advocates lament SoCalGas and the restaurant association’s success in their
ght against building electri cation. That said, recent regulations and incentives
make them optimistic about zero-emissions buildings long term.
How fast that transition happens is the question, said Merrian Borgeson, director of
California climate and energy programs at the Natural Resources Defense Council.
And an important turning point in the state’s war over gas stoves lays ahead.
The California Air Resources Board is considering a regulation that would ban the
sale of all new gas appliances starting in 2030. The rule would allow only the sale of
zero-emission appliances.
SoCalGas now says it is committed to decarbonization by switching to low-emission
sources such as renewable natural gas and hydrogen. But many advocates are
bracing for the utility and other gas companies to continue ghting any form of a gas
ban.
“I hope it’s not a ght, but we’re not done by any means,” Borgeson said. “If we are
agreeing on where we need to go, we can have a constructive conversation and how
to get there. If we’re still in denial, we have more work to do.”
This story was originally published August 17, 2023, 5:00 AM.
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ARI PLACHTA
916-321-1374
Ari Plachta is a climate reporter for The Sacramento
Bee. She joined the newsroom after reporting on
water for the Los Angeles Times, schools for the LA
Daily News and politics as a freelancer in Israel-
Palestine. Born and raised in the San Fernando
Valley, she is a graduate of UC Berkeley ’s Goldman
School of Public Policy.
JOE RUBIN
916-321-1006
Joe Rubin, an Emmy award-winning investigative
reporter for The Sacramento Bee, unpacks complex
systems with an eye toward holding power to
account. Rubin’s reporting for the San Francisco
Chronicle, NPR and Capital & Main has led to state
laws protecting workers from lead poisoning and
has exposed wasteful spending.
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9/19/23, 12:52 PM SoCalGas spends millions to fight bans on restaurant gas use | The Sacramento Bee
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