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California Regulators Begin Examining Future of Aliso Canyon Storage Field

Consideration of Southern California Gas Co.'s (SoCalGas) request to reopen the state's largest natural gas storage facility kicked off Thursday as the California Public Utilities Commission (CPUC) voted unanimously to open an investigation of the matter.

Action at the CPUC in San Francisco came on the same day in Sacramento that a state Senate committee moved a proposed urgency bill (SB 57) to block any reopening of the 86 Bcf capacity Aliso storage facility until after an ongoing root cause investigation of the four-month-long storage well leak last year is completed and made public.

As previewed late last month, the CPUC opened a two-phase proceeding with the first phase analyzing the feasibility of reducing or eliminating the use of the 3,600-acre, 114-well Aliso facility, whose role has been historically regional in scope. The analysis will examine the effect on reliability and consumer rates for gas and power in the region if Aliso’s role is reduced or eliminated. A series of public workshops is expected during the first phase.

In the second phase, the CPUC will use the results of the first phase to determine what to do with Aliso Canyon, and under "what conditions and parameters and in what time frame." A final decision is expected in mid-2018.

Commissioner Liane Randolph said a new state law passed last year (SB 380) and now the new CPUC proceeding should "provide us an opportunity to step back and take a more long-term, measured look at the reliability and rate impacts."

The commission is expected to benefit from an ongoing independent evaluation by the California Council on Science and Technology, looking at the long-term viability of the 12 natural gas storage facilities in the state.

SB 380 mandated that the CPUC conduct this proceeding and consult with the California Energy Commission, California Independent System Operator for the electric grid, investor- and publicly-owned utilities, and the state Division of Oil, Gas and Geothermal Resources.

Meanwhile, the state Senate Natural Resources and Water Committee voted 7-2 Thursday to move the urgency measure SB 57 to block any near-term reopening of Aliso Canyon, which SoCalGas has determined is "safe for service to resume" operations.

Sponsor of the legislation, Sen. Henry Stern, a former aide to retired Sen. Fran Pavley, who authored last year's SB 380, arranged for the committee to hear testimony and arguments from local residents, representatives of the Los Angeles County fire and public health department, environmental organizations, and a bipartisan coalition of elected officials, all against reopening Aliso at this time.

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