A new gas line or cash to electrify? California lets households choose.

California has a new law that changes what happens when your gas utility needs to replace the pipe that runs from the street to your house. Right now, utilities just dig up the yard and install a new line, often costing $20,000 to $30,000, a cost spread across all gas customers' bills. Under the Home Energy Choice Act, utilities will instead have to offer households facing a line replacement a choice: get the new gas line, or take a cash incentive, potentially worth several thousand dollars, to switch to electric equipment instead, such as a heat pump, induction stove, or heat-pump water heater. The incentive is meant to cost less than a new pipe, with the difference saved by all gas customers.

The law caps these programs at 1% of a utility's customers and is set to expire in 2035 unless renewed. Incentive amounts, and extra money for households in disadvantaged communities, still need to be worked out by the California Public Utilities Commission, with utilities required to get their programs approved by January 1, 2028. It's also not yet decided how much advance notice homeowners will get before a scheduled line replacement, which matters since that's the window to request the payout instead.

California is the first state to require this approach, though a New York City utility and a Colorado utility already offer similar deals, and other states, including Illinois, Maryland, Minnesota, Oregon, and Washington, are considering their own versions. If you're in California and your gas line is due for replacement in the next couple of years, this program may eventually affect what options your utility offers you.