A New York law enacted by Gov. Kathy Hochul earlier this year to ban natural gas appliances and infrastructure in new buildings is facing a legal challenge by a coalition of businesses and labor unions.

Hochul in May signed into law the All-Electric Building Act, included in the state’s fiscal 2024 budget. The law would require nearly all newly constructed buildings to be all-electric, beginning in 2026 for smaller structures and in 2029 for larger ones.

However, business groups and labor unions want the new law tossed. Plaintiffs include Mulhern Gas Co., National Association of Home Builders, National Propane Gas Association, International Brotherhood of Electrical Workers Local 1049, Plumbers Local Union No. 200 and the AFL-CIO. The lawsuit was filed in U.S. District Court...