Urgency legislation threatens Southern California energy reliability

By Michael Shaw

Capitol Update, Feb. 12, 2016 Share this on FacebookTweet thisEmail this to a friend

Californians living in the Southern California community of Porter Ranch can breathe a little better today now that the Southern California Gas Company (SoCalGas) has, at least, temporarily plugged the leaking natural gas well at the Aliso Canyon natural gas storage facility. While the well is no longer leaking, the environmental impact will be felt for some time to come.

Several bills have already been introduced that respond to the months-long leak of methane from the largest storage facility in the West. One of those bills, SB 380 by Senator Fran Pavley, immediately puts a halt to any new injections and withdrawals, also known as production, of natural gas at the storage facility until the entire facility and all 115 wells are deemed safe according to current standards. The safety and health of those working at the facility and living in the surrounding community remains a priority

SB 380 and other bills that seek to ban further use of the facility could lead to a negative consequence that has much broader ramifications for Southern California and beyond. California manufacturers depend on affordable, reliable energy in both the forms of electricity and natural gas and this bill places that at risk by taking the Aliso Canyon facility out of use for an extended period of time. Here are a few of the ramifications of SB 380:

  • Electrical generators in Los Angeles and Orange counties who depend on natural gas from this facility to supply power to the Los Angeles basin could see curtailments that lead to higher prices and brownouts that impact production processes and schedules.
  • Natural gas deliveries to manufacturers would also be curtailed in order to meet the higher priority obligations to supply residences and other preferred customers leading to production disruptions.
  • Higher transportation fuel prices due to supply restrictions resulting from reduced electricity and natural gas deliveries to refineries that depend on both energy sources in order to operate equipment.

CMTA joined with the California Business Roundtable and the Southern California Leadership Council to issue a letter on SB 380 to express concerns about the impact of the bill and outline amendments that would be able to mitigate the negative effects of the bill while protecting public health and safety. The legislature must amend the bill to allow continued injection at each well as they are deemed safe and not delay injection for all wells to be deemed safe.

SB 380 is set for hearing in the Assembly Utilities and Commerce Committee on February 22nd

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