CPUC/DOGGR: Commission Changes Withdrawal Rules for Aliso Canyon

Published On: July 26, 2019

The CPUC this week approved a new withdrawal protocol for SoCal Gas’ Aliso Canyon storage facility. SoCal Gas can now withdraw natural gas from Aliso Canyon as long as it is for improving energy reliability and minimizing price volatility. This is a change from the prior protocol that allowed SoCal Gas’ Aliso Canyon to only be used as an “asset of last resort.”

Under the new protocol, SoCal Gas can withdraw gas from Aliso Canyon if the amount of fuel in the region’s pipelines is low or the amount of gas in two of the utility’s other storage fields is low. This change should help the gas market in the Summer months especially since Aliso Canyon is close to its new storage capacity as SoCal Gas injected into the facility from mid-March through mid-June.

The bad news is that the only way to address the Winter gas market issues is to expand storage or increase gas flowing into California. The change in the protocol did not address storage limits.

In addition, SoCal Gas announced that it would take longer to reopen one of its gas lines. Line 235-2, which runs approximately 50 miles between Victorville to east of Barstow, ruptured on October 1, 2017, and has been closed ever since. The pipeline is a 1957 vintage and appeared close to reopening. However, SoCal Gas announced a delay to August 29 and this is not first delay. The line was first scheduled to re-open in Mid-April, Mid-June, late July and now August 29. Will the gas line reopen on August 29 is anyone’s guess.

This is not the only gas line facing problems. Additionally, two other gas lines, Line 3000 and Line 4000, have reduced capacity. SoCal Gas initially reduced capacity on Line 3000, which extends about 125 miles Needles on the California-Nevada border to East of Barstow, in June of 2016 after inspectors found safety issues. Line 4000 extends from East of Barstow to Cajon has also seen its capacity reduced. All three lines are more than 60 years old and in need of repair. SoCal Gas plans to do upgrades on the other two lines once Line 235-2 is operational. In the meantime, SoCal Gas’ gas line system is running at less than 85 percent of optimum.

Reduced availability of Aliso coupled with limitations on several pipelines has caused gas supplies to be tight in Southern California for years, resulting in gas curtailments to power generators and higher power and gas prices for consumers.

The CPUC said price spikes due to gas shortages last summer caused an $800 million increase in power procurement costs for SCE.

SoCal Gas has four storage fields: Aliso, Honor Rancho, La Goleta and Playa del Rey.

About the Author: Matt Ross

Matt Ross is a Senior Consultant in the energy industry and has more than a dozen years of experience in state government. He can be reached at matt at govreport.org