NEW REPORT: NW Natural’s Biomethane Boondoggle Finds SB 98 Is Greenwashing Fossil Gas, Driving Pollution, and Failing Oregon’s Climate Goals

PORTLAND, Ore. — A new report released today by the Sierra Club and Breach Collective finds that NW Natural has taken advantage of Senate Bill 98 (SB 98), a law that it authored and supported, to pour more than $60 million in ratepayer dollars into out-of-state biomethane projects that have failed to meaningfully reduce greenhouse gas emissions, driven localized pollution, and contributed to the most pollution-intensive forms of industrial animal agriculture. 

SB 98 allows gas utilities to invest in so-called “renewable natural gas” or biomethane, even if the fuel is significantly more expensive than methane gas. According to reporting, the primary motivation of gas utilities in promoting SB 98 was to avoid emissions reduction requirements that would have reduced their gas customer base. Sierra Club and Breach Collective’s report finds that the law has allowed ratepayer dollars to flow to the most polluting slaughterhouses in the United States, contributing to local air and water pollution while failing to reduce gas demand or climate emissions. Meanwhile, despite spending tens of millions of ratepayer dollars on biomethane projects, NW Natural has failed to meaningfully reduce gas demand or climate emissions. 

“SB 98 was sold as a climate solution, but in practice it has become a subsidy for industrial animal agriculture and a lifeline for a gas utility trying to avoid real emissions reductions,” said Danny Noonan, Climate, Energy & Labor Strategist at Breach Collective and co-author of the report. “Oregonians are paying more on their gas bills so NW Natural can greenwash fossil gas with paper credits from polluting facilities hundreds of miles away.”

Biomethane is not a feasible climate solution due to high costs and scarcity of sources, and NW Natural’s pursuit of biomethane projects has delayed electrification and heat pump adoption, considered the fastest, most effective, and least-cost pathway to reduced greenhouse gas emissions in the buildings sector. 

NW Natural’s biomethane spending has also overwhelmingly flowed to anaerobic digesters at massive concentrated animal feeding operations (CAFOs)—large-scale industrial livestock facilities that confine thousands of animals and generate enormous volumes of manure and waste—and associated meat processing plants operated to multinational corporations such as Tyson Foods in Nebraska. Communities near these facilities face increased air and water pollution from concentrated animal waste, while evidence suggests biomethane markets may incentivize larger, more pollution-intensive CAFOs and accelerate consolidation within animal agriculture. 

“Biomethane is being used as a distraction from proven, affordable climate solutions like electrification,” said Dylan Plummer, Deputy Director of the Sierra Club’s Clean Heat Campaign and co-author of the report. “Instead of investing in heat pumps and efficiency upgrades that actually lower bills and emissions, NW Natural is pouring ratepayer money into risky projects that prop up fossil gas and industrial agriculture.” 

The report also highlights the growing financial risks of projects pursued under SB 98. NW Natural’s Lexington, Nebraska biomethane project, which was backed by Oregon ratepayers, shut down after just a few years of operation. A purported $43 million investment in a biomethane facility in East Wenatchee, WA, was quietly abandoned by the utility in 2025, with unclear impacts to ratepayers.

Despite producing far less gas than projected and delivering limited emissions benefits, the utility is now seeking to shift remaining costs onto customers. Even under the most optimistic assumptions, the report finds that NW Natural is nowhere near meeting SB 98’s biomethane targets, including a 5% target by the end of 2024. Based on current trends, future targets of 10% by 2029 and 30% by 2050 appear unattainable. As the utility has attempted to scale up its biomethane supply, the greenhouse gas intensity of that supply has dramatically increased, resulting in a dwindling climate benefit.

The report recommends repealing SB 98, ending ratepayer-funded biomethane investments, and redirecting resources toward proven solutions such as building electrification, heat pumps, and energy efficiency, strategies that cut emissions faster, protect public health, and lower long-term energy costs for Oregonians.