California utility pays $175,000 settlement for false ‘renewable’ advertising

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In a recent settlement with the state of California, the Southern California Gas Company (SoCalGas) faced accusations of misleading the public regarding their use of “renewable natural gas.” Authorities in the state accused the company of violating two California laws: the Unfair Competition Law (Bus. & Prof. Code, § 17200 et seq.) and the False Advertising Law (§ 17500 et seq.)

Under the terms of the settlement SoCalGas is required to pay a fine of $175,000, halt its deceptive advertising that labels their gas as ‘renewable’, and release a statement on their website noting that only 5% of their gas originates from renewable sources.

SoCalGas advertisement as per the State of California complaint filing

The complaint filed by the state of California revealed that SoCalGas deliberately misled consumers. While ‘renewable’ gas does exist, the company falsely marketed their conventional gas product as such. The evidence is stark: in 2018, despite their claims of selling ‘renewable natural gas’, they sold absolutely none. By 2022, they had only managed to provide 5% renewable gas to residential, small commercial, and industrial customers.

In 2019, California authorities turned a spotlight on SoCalGas’s advertising tactics. They discovered that the company made sweeping ‘renewable’ marketing claims on informational displays, backdrops, and promotional items like hats, t-shirts, and notepads. These were widely distributed at approximately 14 conferences and community events that SoCalGas either participated in or sponsored. Among these events was the “Ag Expo,” a massive three-day gathering attracting approximately 100,000 attendees, where SoCalGas featured an ‘educational’ and interactive display. The company also sponsored a “Heal the Bay” event, providing a photo booth backdrop for attendees.

Gas is primarily composed of methane, a potent greenhouse gas. Historically, the term ‘natural’ was applied to it in the 1800s to differentiate methane obtained directly from the ground from the gas derived from coal processing. Today, a more apt, modern descriptor for this energy source is ‘fossil gas’.

SoCalGas’s misrepresentation of its fuel as ‘renewable’ gas, as described by California’s filing, references biomethane primarily derived from landfills and dairy operations, then converted to biomethane, mostly for use in transportation. Using biomethane instead of fossil gas achieves a “net reduction” in the emission of greenhouse gasses that exacerbate climate change.

However, fighting climate change by capturing and burning biomethane and releasing the resulting CO2 has a modest effect at best. Alternatively, recent emission studies on cows’ diets at the University of California, Davis and the Commonwealth Scientific and Industrial Research Organization at James Cook University in Australia showed that replacing 2% of a cow’s diet with macro red algae can cut methane emissions from enteric fermentation by 99% via an enzyme inhibitor in the algae.

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