New York can forgo Williams Cos.’ $1 billion natural gas pipeline expansion by instead boosting energy efficiency and adopting renewable technologies, a green group says.

National Grid Plc, the main customer for the Northeast Supply Enhancement Project, has said the supply increase would allow it to meet a growing need for gas in New York City, which is phasing out the use of heavy oils to heat buildings. But Williams’ demand projections are too high given that boiler conversions have...