By Jason Fordney
California regulators last week advanced on a plan to study the potential for eliminating the Aliso Canyon natural gas storage facility.
The move came as Southern California Gas reiterated warnings about the impact of gas shortages on grid reliability this summer.
The state’s Public Utilities Commission issued a draft request for proposals to develop an “Aliso Canyon Reliability and Economic Analyses.” The central question to be answered, according to the draft: “should the commission reduce or eliminate the use of the Aliso Canyon storage facility, and if so, under what conditions and parameters, and in what time frame?”
The commission seeks public comment on the draft by June 29 and expects to issue the RFP on July 6. It is considering what elements of the proposal work or could be improved, if any important questions are missing and whether instructions are clear.
Injections into the 86 Bcf facility near Los Angeles have been halted since the leak was discovered in October 2015. The restriction was kept in place even after the leaking well was finally plugged in February 2016.
State Senate Bill 380 prohibited reinjection of gas into Aliso until completion of a safety review and required the PUC to determine whether use of the facility can be reduced or eliminated while still maintaining electric and gas reliability.
Winning bidders on the RFP will be required to hold stakeholder workshops and public hearings, as well as perform hydraulic model analysis of the reliability of the Aliso system under a variety of scenarios, using forecasted electricity demand and contribution of renewables to the generation mix.
The PUC is looking for bidders experienced with Synergi Gas software — or an equivalent — and working on gas-electric coordination. Also desired is a background running community forums and “developing models to assess the market, consumer and economic impact of significant changes to the natural gas or related markets.”
Bidders’ proposals are due on Aug. 24, and the contract award date is tentatively set for Sept. 29.
SoCalGas last week repeated a May warning directed at the PUC, California Energy Commission and CAISO about Aliso Canyon. (See California Grid Emergency Comes Days After Reliability Warning.)
“From our perspective, we are cautiously optimistic that, based upon the CAISO forecast, we will be able to meet the demands on our system. Of course, this is dependent on there being no unplanned outages on either the electric or gas systems,” SoCalGas CEO Bret Lane said in a June 16 letter.
Lane’s letter was accompanied by another June 13 letter from a group of municipal utilities to State Sen. Henry Stern, saying that they have serious concerns with the continuing moratorium on injections that the legislature required until a root cause of the leak is identified. The analysis is not needed because the wells have been retrofitted and gas no longer flows into outer casings, the practice that led to the gas leak, the utilities said.
“We are concerned that the bill constrains the transmission of natural gas, which could limit local electric supply, resulting in electric outages,” says the letter from Burbank Water and Power, Pasadena Water and Power, and Vernon Public Utilities.
The utilities also said that the legislation failed to define a process for emergency gas injections, “suggesting that a response to a blackout might come too late.” They backed SoCalGas’ recommendation that the current gas inventory at Aliso Canyon be increased to prevent blackouts.
The utilities caution that temperatures were moderate last year, which has so far not been the case this year. A heat wave last week swept areas of California, cutting electricity to about 190,000 Pacific Gas and Electric customers and prompting CAISO to issue a conservation alert. (See California Heat Wave Prompts CAISO Flex Alert.)