Two Northern California cities just learned – again – that local “electrify everything” mandates run into both federal law and energy affordability. California cities Petaluma and Morgan Hill are backing down from costly, illegal policies after a Department of Justice (DOJ) lawsuit challenged their unlawful natural gas hookup bans. The two cities have repealed or removed their rules banning natural gas appliances in new construction after facing not only federal legal preemption, but also the reality that forcing electrification could drive sky-high state energy costs even higher.
A Tale of Two Failed Gas Bans
In January, the DOJ sued Petaluma and Morgan Hill over municipal rules that blocked natural gas infrastructure in new construction, effectively banning appliances that families and businesses rely on every day. The federal complaint put it plainly:
“In pursuit of “electrification,” these bans deny consumers reliable, resilient, and affordable energy, as well as the use of commonplace gas appliances for cooking, heating, and other household needs. But natural gas is often the lowest cost and most efficient energy source for uses like these—outperforming electric on both expense and lifecycle emissions.”
The lawsuit produced what years of activist messaging could not: a rapid cleanup of unlawful policies.
After the lawsuit, Morgan Hill adopted an ordinance repealing the municipal code chapter that prohibited natural gas infrastructure in new buildings, while, just recently, Petaluma rewrote its ordinance into a voluntary policy encouraging electrification and eliminating all mandatory electrification requirements.
With both cities’ ordinances rescinded or neutralized, DOJ moved to dismiss the case on March 23, 2026.
As Energy In Depth has previously highlighted, both bans were illegal under the Energy Policy and Conservation Act (EPCA), which gives the federal government sole authority to regulate appliance energy standards.
Even the South Coast Air Quality Management District Board, famous for aggressive environmental policy, shot down a proposal to encourage the state to move away from gas heaters in 2025.
But it wasn’t until the DOJ sued the cities in January that local legislators woke up to the illegality and unpopularity of the bans and finally took steps to remove them for good.
Despite the Recent Change, Petaluma is Still Anti-Gas and Anti-Consumer
Public comments on the Petaluma ordinance reveal that locals are skeptical that the city will actually follow federal law and allow for complete consumer choice of appliances. As one concerned citizen pointed out, an ordinance “promoting” electric appliances still offers incentives to builders to replace gas appliances, therefore threatening energy affordability and consumer choice.
Another resident pointed out that even though Petaluma has branded itself as a pioneer in climate policies, it has little to show for it. Moreover, not fully repealing the ban will waste city resources. As the concerned citizen’s comment said:
“For the better part of six years, this City has invested substantial staff time, legal resources, consultant work, and political capital into positioning itself at the forefront of building electrification policy. This was framed as local leadership on a global issue. Yet the practical impact of a single city’s ordinance on worldwide greenhouse gas emissions is, candidly, negligible.”
In light of the cost-of-living crisis, Petaluma would be better off redirecting time and money away from green policies to initiatives which actually improve affordability. A full repeal would help ensure affordable energy for residents and less confusion for developers of housing projects in the city.
Affordability Makes These Bans Harder to Justify
Mandating all-electric construction means forcing more demand onto an already expensive electricity system. In January 2025, EIA reported California’s average residential electricity price at 30.23 cents/kWh versus 17.45 cents/kWh nationally, or 74 percent higher. California’s Legislative Analyst’s Office has likewise documented that residential rates are among the highest in the country and have been rising quickly.
In a state where energy costs are already punishing, policies that restrict choice and concentrate risk in a single pathway are reckless.
Bottom Line: Petaluma and Morgan Hill backed away from legally vulnerable natural gas bans after the DOJ challenged them, and cost pressures made the politics untenable. This episode is a reminder that ‘electrifying everything” mandates challenge federal law, household budgets, and basic consumer freedom.
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