Voluntary RNG Programs Had Almost No Takers. Then Came the Mandates.

In 2020, NW Natural launched a voluntary renewable natural gas program for residential customers in Oregon. For an extra $5 to $15 per month, households could designate a portion of their gas supply as biogas-derived. After 18 months, the program had enrolled fewer than 4,000 of the utility's 780,000 residential accounts. That is a participation rate of roughly 0.5%.

NW Natural was not an outlier. Voluntary RNG programs at utilities across the country have consistently failed to attract meaningful enrollment. The pattern is so consistent that the industry has largely abandoned the voluntary model. In its place: state-level mandates that spread the cost across all ratepayers, regardless of whether they want to pay for premium gas.

The Track Record of Voluntary Programs

Utility-run voluntary green gas programs emerged in the late 2010s, modeled on the voluntary green power programs that electric utilities had offered since the early 2000s. The logic seemed sound. Some customers will pay a premium for cleaner energy. Give them the option and let the market decide.

The market decided quickly. Enrollment data from voluntary RNG programs tells a consistent story. SoCalGas launched its voluntary biogas program in 2021. Uptake remained below 1% of eligible accounts through the first two years. Vermont Gas offered a voluntary renewable option that attracted a few hundred participants out of roughly 55,000 customers. Puget Sound Energy's voluntary program in Washington saw similarly modest interest.

Electric utility green power programs, for context, typically achieve 3% to 8% voluntary participation after several years of marketing. RNG programs have consistently performed below even that modest benchmark. The premium is higher, the product is less visible to customers, and the environmental narrative is harder to communicate. Most consumers do not understand what renewable natural gas is, let alone why it should cost three to five times more than conventional gas.

The Pivot to Mandates

By 2022, the RNG industry had largely stopped relying on voluntary adoption. The new strategy was legislative: pass state-level mandates that require utilities to blend or procure specified volumes of renewable natural gas, then recover the costs through general rate cases.

Oregon's Senate Bill 98, signed in 2019, was the template. It authorized gas utilities to acquire RNG up to 5% of total gas sales by 2030, with costs recoverable from all ratepayers. The law included no opt-out provision for residential customers. The premium that 99.5% of NW Natural's customers had declined to pay voluntarily was now embedded in everyone's bill.

California followed a similar path. SB 1440 in 2018 directed utilities to develop RNG procurement programs, and the California Public Utilities Commission has since approved cost recovery mechanisms that spread the premium across all residential accounts. Washington, Minnesota, and several other states have adopted or are considering comparable mandates.

The shift from voluntary to mandatory is not subtle. It is the defining regulatory strategy of the RNG industry over the past five years.

What Changed Between the Offer and the Mandate

Nothing changed about the product. RNG is the same gas, at the same price premium, with the same environmental profile it had when customers were offered the choice. The methane content is identical once it enters the pipeline. The climate benefit depends on the same upstream capture and processing variables. The cost remains three to five times conventional gas.

What changed was the decision-maker. In a voluntary program, each household weighs the premium against their budget and values. In a mandate, a state legislature or utility commission makes the decision for millions of households at once.

This is not inherently wrong. Mandates are a legitimate policy tool. Society mandates seatbelts, building codes, and emissions standards because individual choice alone does not produce optimal collective outcomes. But most mandates address situations where the individual has no alternative. RNG mandates are different. They fund a specific technology, at a specific price, to achieve an environmental outcome that other technologies achieve at lower cost.

When a state mandates RNG procurement, it is not simply requiring methane reduction. It is requiring that methane reduction happen through the most expensive available method, funded by the people who, when asked directly, declined to pay for it.

The Consent Problem

Consumer protection law rests on a basic principle: people should know what they are paying for and have some voice in the decision. Utility rate cases technically provide this opportunity. Rate filings are public. Commission hearings accept public comment. In practice, the process is inaccessible to ordinary ratepayers.

A typical RNG cost recovery filing runs 200 to 400 pages of technical and financial documentation. Public comment periods attract utility lawyers, industry representatives, and occasionally an environmental organization. Individual ratepayers almost never participate. The process is transparent in theory and opaque in practice.

The result is a consumer protection gap. Millions of households are paying RNG premiums they never agreed to, through a process they never knew about, for a product most of them cannot identify on their utility bill. The voluntary programs proved that informed consumers, given the choice, overwhelmingly decline this product at this price. The mandates ensure they pay for it anyway.

This does not mean RNG has no value. It means the current policy mechanism bypasses consumer consent in a way that would draw scrutiny in almost any other market.

A Different Approach to the Same Problem

If the goal is methane reduction from agricultural and waste sources, the question should be which approach delivers the most atmospheric benefit per dollar of public expenditure. Voluntary programs answered that question clearly: consumers do not value RNG enough to pay the premium. Mandates override that answer rather than responding to it.

An alternative model would fund methane destruction directly through public appropriations or dedicated climate funds, subject to standard budget scrutiny and cost-effectiveness review. Enclosed flares, which destroy methane on-site at $10 to $20 per ton of CO2e, could be deployed at thousands of sites for a fraction of what RNG mandates cost ratepayers.

The distinction matters. Public appropriations go through legislative budget processes where costs are visible and debated. Utility rate mandates bury costs in monthly bills where they attract no scrutiny. Both approaches spend public money on methane reduction. One does it with consent and transparency. The other does it despite the clear evidence that consumers, when given a voice, said no.

The 0.5% enrollment figure from NW Natural is not a market failure. It is a market signal. Policy should respond to it, not override it.