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California Storage Leak Mitigation Plan Could Be Problematic For SoCalGas

California air quality regulators have issued a proposed climate impacts mitigation program to counteract the climate change setback from the four-month Aliso Canyon natural gas storage well leak. Aliso operator Southern California Gas Co. (SoCalGas) now finds itself at odds with stakeholders and news media alike.

Some stakeholders are urging the California Air Resources Board (CARB) to push for a more extensive program, and the Los Angeles Times in an editorial Sunday criticized SoCalGas for allegedly reneging on its promises to offset the climate change impacts of the leak.

"Last year, [we] committed to mitigate the greenhouse gas [GHG] emissions, and we stand by that commitment," a SoCalGas spokesperson told NGI on Monday.

Behind the CARB proposal is an emergency order in early January from Gov. Jerry Brown calling for SoCalGas to, at its own expense, reduce methane gas emissions equal to the level of the volumes that eventually are attributed to the now-plugged well leak. The amount of gas leaked is still being calculated (see Daily GPI, Jan. 11). How this is accomplished is the subject of legal and regulatory debate.

At present there is no agreement on the mitigation program starting points, units of measurement, timetable and ultimate methane sources on which to focus, and it is clear from initial reports that SoCalGas does not agree with the CARB mitigation program as outlined in a 23-page document, which a CARB spokesperson called a "framework."

The utility told CARB in a March 24 letter commenting on a draft of the now released plan that it disagrees with part of the program. The SoCalGas spokesperson on Monday said there are "many laudable goals" in the CARB program, including the possibility of applying "innovation and technology advancement."

In its comments letter, SoCalGas made the legal argument that since CARB previously chose not to regulate fugitive emissions, such as the Aliso leak, the Sempra Energy utility is not legally bound to adopt the mitigation program. Regardless, the utility takes issue with many of the details of the proposed mitigation plan, including the use of a 20-year "global warming potential" (GWP) value for the volumes of leaked gas, compared to the standard 100-year GWP used by CARB and federal regulators in other programs.

CARB's proposal focuses on methane, as opposed to the broader carbon dioxide (CO2), with an emphasis on the state's agriculture (dairy cattle operations) and waste (landfill and wastewater) sectors. "The program presumes that SoCalGas will continue to embrace its earlier pledge to work with the state to mitigate the environmental impacts of the leak," CARB said in its latest plan.

"We will be assessing the full impact of the leak for weeks or months to come," CARB's spokesperson said. "Therefore, the plan is designed as a framework on which we can build, but in that context, it is final."

As part of five commitments, SoCalGas has publicly highlighted for months that it will "develop and implement a plan to mitigate the GHG emissions of the leak, at our expense -- not our customers." On it website, the Sempra utility said it is "in the process of measuring the actual amount of natural gas released and should have results to share publicly within the next several weeks," and at the same time it is developing a plan "to mitigate the GHG emissions associated with the leak."

Separately, but related to the state's methane mitigation efforts, a study by some New Zealand researchers published in the current issue of Science concludes that cows, not cars, may be the main culprit behind the spike of methane released over the past 10 years. Other studies, such as a recent one by Harvard researchers blame the shale gas revolution in North America.

SoCalGas talks about the Aliso Canyon leak in terms of CO2 emissions -- not the 100,000 tons of methane used by CARB -- and points out that on an annual emissions basis, the storage well estimated volume of 2.8 million metric tons (mmt) that escaped from the leak is only a fraction of the estimated 459.3 mmt of CO2 emissions annually in the state, the two biggest sources of which are transportation (172.5 mmt) and power generation (90.6 mmt). Nationally, there are more than 6,600 mmt of CO2 emissions annually.

In California, dairy operations account for nearly 20 mmt annually and landfills another 8.3 mmt of CO2 emissions, both of which would be targets under the CARB plan for SoCalGas to make up for the Aliso leak's estimated 2.8 mmt.

According to its letter to CARB, SoCalGas wants more flexibility in terms of the timing, cost, siting and sources of the methane or CO2 reductions. And it is opposed to CARB's proposed restriction against use of the existing allowances and offsets under the state GHG emissions cap-and-trade program.

The utility pointed out that in the most recent auction, in February, CARB was unable to sell 3.5 million allowances, "which clearly suggests there is room in the market to accommodate an additional purchase in the approximate range of 2.4 million tons."

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