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Frost Busters : Utilities Run Low on Gas as Cold Snap Continues

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Times Staff Writer

The cold weather across the nation has unleashed a record appetite for natural gas and mechanical difficulties in shipping it, creating a shortage that forced Southern California Gas to cut off deliveries Tuesday to its big electric customers.

One of those customers--San Diego Gas & Electric--issued a plea for its residential customers to turn down the heat in their homes to conserve gas supplies. The San Diego utility also cut off gas deliveries to about 200 big industrial customers.

The natural gas squeeze was momentarily even tighter in Las Vegas, where Southwest Gas temporarily cut off deliveries to Las Vegas casinos and other commercial customers with backup fuel systems in order to protect residential customers.

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It was the third time in about 13 months that Southern California Gas has had to quit delivering natural gas to big customers in order to conserve enough for private residences and other customers who aren’t able to switch fuels.

Southern California Gas, the nation’s largest gas utility, said it sent out an all-time record 5.2 billion cubic feet of gas on Monday.

The electric utilities, which need fuel to power the boilers that make electricity, have switched to oil, which costs 10% to 15% more than natural gas, according to officials at Southern California Edison.

Those higher costs and the likely boost in natural gas prices resulting from the shortage will eventually be reflected in customers’ utility bills.

The shortage was described as a cold weather problem that has triggered sharply higher demand across the nation, taxing the pipeline systems that crisscross the country and diverting natural gas to the biggest markets and the neediest regions.

El Paso Natural Gas, one of California’s biggest suppliers, said record demand in the Midwest and East was sopping up “spot” gas, or that which isn’t spoken for in long-term contracts. When the cold also hit the West, the company wasn’t able to deliver its usual complement.

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An El Paso spokesman sought to minimize the cold weather’s effect on its equipment as a cause of the shortage. But Southern California Gas blamed freeze-ups of gas wells and pipeline gathering systems in Texas, New Mexico and Oklahoma for slashing its daily volumes of out-of-state gas deliveries by 40% from the El Paso and Transwestern pipeline firms.

In San Francisco, Pacific Gas & Electric reported a cutoff of similar scope from El Paso. PG&E;, which produces both gas and electricity, switched its own boilers to oil several days ago to conserve gas, but said it hasn’t had to curtail shipments to other electric power generators. PG&E; is its own biggest gas customer.

“Due to the shortfall in interstate gas deliveries, we have had to rely on our stored reserves to meet the needs of electric utilities as well as those of our other customers,” said Fred John, a senior vice president. “To assure that we have adequate reserves to meet the needs of residential and other higher-priority customers, we had to cut back deliveries to our electric utility customers.”

John said its underground reserves of gas on Jan. 31 totaled 36 billion cubic feet, or 2 billion above the desired level for the date. But the cold weather since Feb. 1 has slashed the total to 22 billion cubic feet.

The curtailment of deliveries to electric utilities is sure to further fuel the debate over the adequacy of natural gas pipeline capacity to serve California. Several developers want to build interstate pipelines into the state, and Southern California Gas has come in for criticism for previous service cutbacks.

However, John said the gas company notified utilities and state officials last summer that it planned “a significant amount of curtailment” this winter. The utility labels such curtailments a normal means of matching supply with demand.

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In December, 1987, cold weather and unusually low reserves prompted Southern California Gas to cut off deliveries to electric utilities. The following month, it broadened the cutoff to nearly 1,000 industrial customers.

Last summer, unusually hot weather, the drought and other factors drove electricity usage up sharply, again prompting Southern California Gas to cut off supplies to electric utilities for the specific purpose of making sure there were plenty of gas reserves heading into the winter.

“We were in good shape until Feb. 1,” John said Tuesday.

He declined to speculate on how long the curtailment might last, saying that it depends entirely on the weather. He said he couldn’t rule out a broadening of the gas cutoff to industrial customers if the cold weather holds.

In Las Vegas, spokesman Dante Pistone of Southwest Gas said a breakdown at one of El Paso’s compressor stations sent pressure tumbling in the utility’s system late Monday and early Tuesday, preventing it from delivering gas to numerous commercial customers. They included many big hotel-casinos on the strip that have backup fuel systems, Pistone said.

Southwest’s call for natural gas more than quadrupled in recent days, an El Paso spokesman said, an example of the tightening of supplies that has stretched utilities thin around the country.

“There’s a lot of shifting of load to keep all the customers along the pipeline happy,” Pistone said.

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San Diego Gas & Electric, which buys virtually all its natural gas from Southern California Gas, switched its own electric generating facilities to burn oil. Also affected are the Los Angeles Department of Water & Power and several smaller municipal electric utilities.

Though SDG&E;’s residential and smaller commercial customers have not been cut off, the utility issued a rare request that homeowners lower their daytime thermostats to 60 degrees--down from the normally recommended 68-degree setting.

SDG&E; has not asked residential customers to cut their natural gas consumption in more than 10 years, spokesman Tom Murnane said.

“It’s a very unusual situation for us to . . . not only curtail commercial and industrial customers but also to ask residential customers to conserve,” Murnane said.

Two hundred of SDG&E;’s commercial and industrial customers also have switched from natural gas to fuel oil and propane, Murnane said. “If it gets bad enough, we might have to curtail some residential customers, but we don’t expect that to happen.”

Staff writer Greg Johnson in San Diego contributed to this report.

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