BUSINESS
Your Thanksgiving dinner is cheaper this year. Here's why

SoCalGas and California government bicker over Aliso Canyon as winter nears

The Aliso Canyon natural gas storage field in Los Angeles County may be back up and running — albeit on a limited basis — but that has not dispelled concerns about reliable supplies.

And with winter fast approaching, two state commissions and Southern California Gas Co., the utility that operates Aliso Canyon, are bickering over the role the facility — home to a massive gas leak two years ago — should play to make sure the heat stays on.

Three weeks ago, the president of the California Public Utilities Commission, or CPUC, and the chairman of the California Energy Commission, or CEC, sent a letter to Southern California Gas President Bret Lane, saying they “are concerned” about the utility’s ability to meet safe and reliable service this winter.

The CPUC and CEC officials cited a number of reasons, including that pipelines representing 42% of natural gas import capacity into the Los Angeles region are currently out of service. They also said the utility has only about 65% of gas in storage that it usually has at this point in the year.

“We are concerned that SoCalGas will not be able to meet demand for core customers if there are high demand days in December 2017 or January 2018,” the Oct. 17 letter said.

Thirteen days later, the utility responded with a letter of its own, saying that if the agencies have concerns about reliability, they should let Aliso Canyon operate in the same fashion as three other storage sites in Southern California Gas territory.

“Returning Aliso Canyon to normal operation and removing CPUC-mandated systemwide withdrawal requirements is the most effective way to address these issues,” Lane said in the letter.

Aliso Canyon is the site of the largest methane leak from a natural gas storage facility in U.S. history. First detected in October 2015 but not permanently contained until February 2016, the leak forced the evacuation of more than 8,000 households in the Porter Ranch neighborhood.

About 100,000 metric tons of methane were emitted. According to a UC Davis study, the total greenhouse gas pollution equaled the emissions of half a million cars driven for a year.

In July, state engineering and safety enforcement experts cleared Aliso Canyon to come back online, with restrictions that limited the site to about 28% of maximum capacity.

Southern California Gas, along with San Diego Gas & Electric, are subsidiaries of San Diego-based Sempra Energy, a Fortune 500 company.

Residential and small-business ratepayers make up the core customer base for Southern California Gas, and the utility says it is cautiously optimistic that it can maintain service for them.

The chief concern is for non-core customers, which include electric generators, manufacturers and hospitals. “They’re big, big users,” said Chris Gilbride, Southern California Gas spokesman.

The utility confirmed four of its pipelines are out of commission and Southern California Gas is holding the lowest amount of gas for this time of year since 2001 but blamed constraints largely on state government decisions.

“The state has to make a policy decision,” Gilbride said. “Aliso Canyon is a key asset in the tool box we use to ensure reliability. Without that tool we are at higher risk. We’ve been telling regulators that for several seasons now.”

Ed Randolph, director of the Energy Division at the CPUC, said, “we’re a little disappointed” in the response from Southern California Gas.

“They’re basically saying, ‘We should be able to use Aliso Canyon the same way we were allowed to use it before the leak,’ ” Randolph said.

To help ease concerns about reliability, Randolph said the CPUC recently issued an order allowing Southern California Gas to bring in gas through Otay Mesa on a pipeline that normally does not supply power plants in California.

As part of the findings that led to the reopening of Aliso Canyon, changes were made in how the field operated.

“The challenge that [Southern California Gas] really has is, you’ve got to very precisely match supply and demand,” Randolph said. “I don’t think they’re taking the approach that some of the other utilities have taken in the last few years — thinking outside the box for ways to either reduce demand or better manage the field.”

Southern California Gas insists the field is safe.

Aliso Canyon “has been through the most comprehensive testing regime of any field in the country,” Gilbride said. “So it seems prudent to make that tool available prior to reducing or stopping service to large customers.”

The back and forth comes at a time when some wonder whether there is too much natural gas in California’s energy mix, given the large amount of renewable energy sources being produced in the state.

Within minutes of the July announcement bringing back Aliso Canyon on a limited basis, CEC Chairman Robert Weisenmiller said his staff was ready to work with state officials to “phase out” Aliso Canyon within 10 years.

Weisenmiller co-wrote the Oct. 17 letter to Southern California Gas.

Randolph said the CPUC is taking seriously the CEC’s goal to shut down Aliso Canyon within a decade but also said, “Our analysis, which is a multi-agency analysis and peer-reviewed by national experts, concludes that on a peak day we need Aliso.”

Some have argued that because Southern Californians did not experience serious power outages when Aliso Canyon was down the facility is not crucial to grid reliability — a notion dismissed by Gary Ackerman, executive director of the Western Power Trading Forum, an organization based in Sacramento whose 90 members in the West buy and sell power.

“That’s like somebody going to a gambling table and saying, ‘I won twice so that means I’ll win a third time,’” Ackerman said. “If you’re going to deem these wells safe, let them operate.”

Bill Powers, a San Diego engineer and consumer advocate, questioned the timing of maintenance work being done on two of Southern California Gas pipelines.

“It just seems like the usual corporate double-speak to set up a situation where you can achieve a political goal which is to make Aliso Canyon seem necessary when it is not,” Powers said.

And what if Southern California experiences a much colder winter than usual?

“The biggest thing we can do to make sure there’s enough gas and the system remains reliable is have everybody voluntarily take some conservation measures at home — things like turning your thermostat from 68 to 65 degrees,” Randolph said.

rob.nikolewski@sduniontribune.com

Copyright © 2017, Los Angeles Times
EDITION: California | U.S. & World
91°