Thursday, January 24, 2019

CPUC OKs Temporary Increase in Aliso Canyon Injections

By Jason Fordney

The California Public Utilities Commission on Thursday voted unanimously to allow Southern California Gas to temporarily increase gas injections into Aliso Canyon, but it denied a request to increase the storage facility’s allowable capacity.

The commission said it approved the decision “recognizing the urgent nature of ensuring reliable gas delivery during peak summer periods and with the summer season quickly approaching, as well as various pipeline outages and curtailments constraining gas flows into the SoCalGas system.”

There is a movement among residents of the nearby Porter Ranch neighborhood in Los Angeles to shut down Aliso Canyon, with many complaining of health impacts even after the massive gas leak at the facility was contained in February 2016, after being discovered the previous October.

The CPUC at its November 9, 2017 meeting in San Francisco (left to right): Martha Guzman-Aceves, Carla Peterman, President Michael Picker, Liane Randolph, Clifford Rechtschaffen | © RTO Insider

While the CPUC’s current protocol is to allow for withdrawals only as a last resort when needed for reliability and other alternatives are exhausted, the facility is proving to be critical to electricity reliability in the region. Its potential loss has been a topic of increasing concern for the commission. When questioning CPUC President Michael Picker during a March hearing after the commission authorized gas withdrawals, State Sen. Henry Stern expressed alarm that it had “secretly granted” SoCalGas’ request to increase usage of the facility. (See Picker Seeks Guidance on IOUs, Aliso Canyon.) But Picker said the commission’s hand is being forced because of gas supply concerns.

‘Even More Urgent’

The CPUC said its measure Thursday will improve system reliability this summer and next winter. It approved several measures within SoCalGas’ second injection enhancement plan, which the company said is needed to meet customer demand and prepare the facility for winter. The plan allows the company to implement temporary modifications to its operations to increase injections and temporarily increase storage injection capacity.

But the commission denied a request to increase the allowable inventory at the facility to enable more systemwide injections and denied a request for more flexible use of the facility through a temporary deviation from certain rules.

CPUC Southern California Gas Gas Injections CPUC

Location of the Aliso Canyon gas storage facility

Aliso Canyon is the largest of the company’s storage facilities and had a capacity of 86.2 Bcf before the leak. Injections into the facility were forbidden through a proclamation of Gov. Jerry Brown in May 2016 until a safety review could be conducted. The state Division of Oil, Gas and Geothermal Resources last July certified a SoCalGas safety plan, allowing injections to resume and the facility to operate at pressure of up to 2,926 pounds/square inch, which translates into a gas inventory of 68.6 Bcf, or about 80% of its capacity.

The CPUC approved a similar resolution for SoCalGas’ first proposed injection plan in June 2017 to support summer reliability last year. That decision also approved an agreement between CAISO and SoCalGas for summer reliability services through Sept. 30, 2017.

The commission said several pipeline disruptions have occurred since then. On Oct. 1, the day after the ISO’s reliability agreement expired, there was a rupture on SoCalGas Line 235-2, which is still not in service. Line 4000 also went under maintenance and is now operating at significantly reduced capacity. A right of way through the land of the Morongo Band of Mission Indians also expired, reducing the capacity of Line 2000. (See SoCalGas Pipeline Losses Spur Curtailment Warnings.)

“All of these outages have placed additional stress on the system, making storage injection even more urgent than it was in spring 2017,” the commission said.

In July, the CAISO Board of Governors approved a package of market rule changes specifically developed to deal with the reduced output of Aliso Canyon. The rules allow the grid operator to constrain the operations of gas-fired plants across the state and the Western Energy Imbalance Market in the face of tight gas supplies. (See CAISO Board Approves Aliso Canyon Rules Package.)

SoCalGas wrote to the CPUC on March 2 asking for the permission to immediately begin using Aliso Canyon to manage gas inventory and preserve withdrawal capability at other storage fields. The company was predicting colder weather and said that storage at other fields was critically low. “Noncore” gas customers such as gas plants saw curtailments, and lower storage levels made it more difficult to withdraw gas.

The commission authorized withdrawals on March 3, provided that SoCalGas coordinate with CAISO and the Los Angeles Department of Water and Power to reduce overall gas demand, and the withdrawals were only authorized through March 13. SoCalGas was to increase inventories at all facilities once demand hit normal levels. The commission directed SoCalGas to file the injection plan with the goal of rapidly achieving more storage capability at fields other than Aliso Canyon and to establish minimum month-end storage targets for the rest of 2018.

Still a Key Asset

The CPUC said that because of pipeline outages, capacity reductions and other limitations, SoCalGas’ technical assessment showed that under a worst-case scenario, there is not enough capacity for this summer to meet both customer demand and to inject additional gas into storage at the rates necessary to meet the winter season storage withdrawal rates as directed by the CPUC, even with the use of Aliso Canyon. Without the facility, the SoCalGas system would not be able to meet summer peak day demand, the commission said.

Under the plan approved by the commission Thursday, SoCalGas cannot guarantee gas storage inventory targets can be reached, even with Aliso Canyon available. The company requested that the allowable inventory at Aliso Canyon be increased to 30 Bcf from the current 24.6-Bcf limit. The commission said that request required additional examination and technical assessment.

SoCalGas estimates that it will reach the current allowable inventory next month and said not having additional injection capacity available will reduce the amount of gas available to the system on any given day.

In assessing Aliso Canyon, the CPUC is faced with the challenge of maintaining reliability while dealing with public opposition to a facility that has become a symbol of the hazards of dependence on natural gas. As unpopular as it is, the facility at present appears to be indispensable for keeping the lights on in Southern California.