California regulators Thursday approved a 50% increase in the working capacity of one of the state’s largest merchant-based underground natural gas storage facilities, Wild Goose Storage LLC, which is about 50 miles north of Sacramento.

The California Public Utilities Commission (CPUC) unanimously agreed that Wild Goose can expand its working capacity from 50 Bcf to 75 Bcf, the third expansion since it was opened as the state’s first competitive storage facility in 1999. At that time, Wild Goose had a total capacity of 14 Bcf.

Wild Goose is interconnected with two major gas transmission pipelines of San Francisco-based combination utility Pacific Gas and Electric Co. (PG&E), which operates its own network of underground storage facilities in Northern California, totaling more than 100 Bcf of working capacity.

In recent years, Wild Goose has been joined by three other private gas storage operators — Lodi Gas Storage, Gill Ranch Storage and Central Valley Storage (see Daily GPI, Jan. 23, 2008) — totaling more than 65 Bcf of underground storage capacity.

“These facilities demonstrate the competitive landscape for storage services in northern California and demonstrate the growing demand for independent storage,” the CPUC said in granting Wild Goose its third expansion.

Wild Goose’s expanded capacity “will increase its ability to respond to changing market demands for baseload and high-deliverability storage services in the future,” the CPUC said.

The state regulators’ action accepted the argument by Wild Goose that there are now two distinct types of service requirements due to the maturation of the Northern California storage market: high deliverability and baseload storage services.

“High deliverability is the customer’s contractual ability to inject and/or withdraw large quantities of gas over a short period of time. High-deliverability service is often contracted by power generators, utilities, and marketing companies,” said the CPUC.

In contrast, baseload storage is when the operator provides lower or steady injection and/or withdrawal service over a set period of time to customers. “Changing market demands for each of these services can result in some customer’s annual storage requirements not being satisfied due to facility limitations,” the CPUC said.

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