The Rhode Island Public Utilities Commission on Thursday held a conference on the issues surrounding natural gas distribution infrastructure as the state moves toward a net-zero future.

Chairman Ron Gerwatowski said the event was an unusual one for the PUC: an open dialogue and listening session, rather than a contested proceeding.

The discussion stems from Rhode Island’s 2021 Act on Climate, which mandates net-zero climate emissions by 2050. The scope of the resulting PUC docket on gas distribution was published only a month ago, after a public comment period.

Gerwatowski outlined the complexity of the path ahead, given the state’s (and region’s) heavy reliance on natural gas to heat homes and generate electricity.

“We can create legal mandates, but no one can amend the laws of physics to instantly mandate the emissions away,” he said.

But the Act on Climate mandates change, so the PUC must find ways to eliminate most or all such emissions in the state, he added. Imposing a moratorium on new natural gas hookups and creating regulatory pathways to abandoning the natural gas system will be among the options on the table, he said.

The goals are mandated, but the exact path to reach them is not, Commissioner Abigail Anthony noted.

“This is really big deal,” Commissioner John C. Revens Jr. said. It was good that so many talented people with so many different perspectives were in the room, he added, because the process needs to be community-driven.

The potential impacts of this transition, and who gets stuck with the tab, were the focus of most of the panelists.

Michele Leone, vice president of gas for Rhode Island Energy, spoke of the utility’s ongoing modernization of its 3,200 miles of gas mains, replacing about 65 miles per year. She did not give a price tag, but Mackay Miller of consulting firm ERM said completion could take 15 more years and cost more than $1 billion.

“The rate base of the entire gas network would likely reach its peak at the final year of pipe replacement,” Miller said. “So the risk of unstable economics for customers is real.”

As customers start electrifying their homes and businesses in larger numbers, the cost of the gas infrastructure falls on an increasingly small number of ratepayers. If electrification is carried out only in the homes of people who can afford to pay for it themselves, the gas infrastructure costs fall on the low- and middle-income customers least able to afford them. And if the costs of stranded gas assets are folded into electric rates, it is a disincentive to the overarching goal of electrification.

Dan Aas of Energy and Environmental Economics (E3) recalled a study of these dynamics that the firm performed in California.

“One potential concern is that as gas rates may increase as utilization of this stuff falls, you could have an economic, or rather, uncontrolled exit of customers from the system,” he said, “which raises some challenges as far as sustainability of the system financially but also significant equity challenges.”

This risk of uncoordinated departures from the gas system needs to be considered in any regulatory review of the future of natural gas, Aas said.

Jeff Makholm of National Economic Research Associates said he is skeptical of the entire concept of natural gas being abandoned because it is such an affordable and reliable fuel.

“We don’t know what the state is going to look like in 2050,” he said. The idea that natural gas will be largely eliminated is “at best unknown, at worst naive,” he said.

But others are ready to make the transition now.

Jennifer Wood, executive director of the Rhode Island Center for Justice, displayed maps where areas of high poverty, low rates of homeownership and high rates of childhood asthma heavily overlap one another.

“In these heavily impacted census tracts, when properties are going to be renovated or mechanical systems are going to be replaced, weatherization and abandonment of gas heating should be the goal starting today,” she said. “And all financial incentives and penalties should be designed to achieve that goal.”

The benefits of decarbonization should be extended first to those communities that for a century have paid with their health for fossil fuel use, Wood said. The cost should be borne most by those who have suffered the effects of fossil fuel emissions least.

“Please don’t pursue low-hanging fruit; do hard things,” she said.

Ben Butterworth, director of climate, energy and equity analysis at the Acadia Center, said the benefit of decarbonization is societal, and its costs will likely need to be borne societally, rather than strictly by ratepayers.

Paul Roberti, chief economic and policy adviser to the state Division of Public Utilities and Carriers, said Thursday’s conversation was an important start given the enormous technical, legal and economic considerations involved in meeting the goals of the Act on Climate.

“The division believes the pace of any policy changes should be guided by two words: ‘orderly transition,’” he said. “What I mean by ‘orderly’ is that any chosen set of policies safeguard two of the bedrock principles in our system of regulation: reliability and affordability.”

Roberti repeated a message conveyed in some way in almost every discussion of decarbonization: “We need to get our electric grid situation in order before we encourage or demand customers switch from gas to electric.”

Toward the end of the conference, Gerwatowski noted that he had heard many diverging viewpoints.

“I don’t think anybody said anything here which you could say, ‘No, that’s not true,’” he said. “Or maybe there was something someone would quibble with. But the idea of the general comments everybody made was, ‘Yeah I agree,’ but then they collide.”

The PUC expects to publish the next step in the docket Friday. It will try to form a stakeholder committee similar to the one formed to look at modernization of electric rates in 2016.