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SoCal Gas Okayed to Use Cushion Gas; PG&E to Give Savings Incentives

Despite summer-like weather throughout most of California last week, the state regulatory commission Friday took action to allow the state's major natural gas utilities to help lessen the sting of upcoming winter gas utility bills, authorizing Southern California Gas Co. to use 4 Bcf of below-market-priced cushion gas in its storage fields to serve low-income customers this winter, and allowing Pacific Gas and Electric Co. to provide rate discounts for customers slashing their monthly energy use by 10% or more.

The California Public Utility Commission (CPUC) action allows the Sempra Energy gas utility to re-classify 4 Bcf of its cushion gas used to pressurize two of its major underground storage fields as so-called "working gas" and make the low-cost supplies available to customers served under the California Alternative Rates for Energy (CARE) program for eligible needy customers.

For the PG&E utility, the regulators authorized a special "10/20" incentive program for residential and small commercial customers, allowing 20% utility bill rebates for reducing year-over-year monthly usage by at least 10%. "The average residential gas customer who reduces the natural gas use by 10 percent will save approximately $90 under the program with $60 resulting from the rebate and the remainder due to reduced natural gas usage through conservation," a CPUC spokesperson said.

CPUC President Michael Peevey and his colleague Commissioner Susan Kennedy commended both PG&E's utility and Sempra's SoCalGas for taking these actions to help customers deal with this winter's expected big gas price hikes. PG&E did not have the cushion gas option with its storage operations, which are more limited than those of Sempra's in the southern half of the state.

"I want to congratulate and applaud SoCalGas and San Diego Gas and Electric; it is a most innovative and rewarding approach," Peevey said.

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