Regulators voted Thursday to continue using the Aliso Canyon natural gas storage facility probably into the next decade, over the objection of local activists and residents who demanded a swifter closure of the site of the largest methane leak in U.S. history.
The California Public Utilities Commission voted 4 to 0, with one abstention, in favor of a plan first pitched Nov. 13 to develop a process to wind down the storage facility as demand for natural gas falls — as is expected in the coming years.
The vote took place in San Francisco, where dozens of people protested outside. Nearly 80 individuals addressed the commission either virtually or in person during a 2½-hour public comment period.
“This is not the same as the commission saying that we do not care about local residents’ concerns,” said CPUC Commissioner John Reynolds. “It means, rather, that we are obligated to … uphold our core responsibility of ensuring safe, reliable and affordable utility service.”
But that came as little comfort to those who for years have pushed to close the Southern California Gas Co.-owned storage field in Porter Ranch, which sprang a lengthy leak in late 2015.
“You’re hearing the distress out there that, ‘We waited nine years for this,’” said state Sen. Henry Stern (D-Calabasas).
The disaster spewed 109,000 tons of methane and other chemicals into the air, forcing more than 8,000 families to leave their homes. Many of those families complained of medical ailments, including headaches, nosebleeds and nausea.
The commission-approved proposal calls for moving ahead with potentially closing Aliso Canyon once Southern California’s demand for natural gas declines to a point at which peak demand can be served without the site.
“Aliso Canyon must be closed for good, but without harming working families with skyrocketing utility bills,” Gov. Gavin Newsom said in a statement. “Reducing reliance on the facility has gone slower than I would like, but the Public Utilities Commission — a constitutionally independent agency — has set out a reasonable path that protects residents near the facility and doesn’t throw the natural gas market into chaos.”
The commission said demand for natural gas is on a downward trajectory as the state continues to bring renewable energy sources online.
The commission proposes initiating proceedings to review and potentially close the facility once the peak demand forecast for two years out decreases to 4,121 million metric cubic feet per day — and a biennial assessment shows that doing so would not jeopardize natural gas reliability or reasonable rates.
“We share the commission’s and governor’s view that natural gas storage at Aliso Canyon is currently necessary to help keep customers’ electric and gas bills lower and for energy system reliability,” SoCalGas spokesperson Chris Gilbride said in a statement Thursday.
The current peak demand forecast is 4,618 million metric cubic feet per day, and that is expected to drop to 4,197 million in 2030, according to a commission information sheet.
“We can only responsibly close Aliso Canyon when demand for natural gas goes down,” said commission President Alice Busching Reynolds.
Busching Reynolds said the first biennial assessment would take place in June. The approved proposal also allows for “incremental reductions” in how much gas is stored at Aliso Canyon.
She struck an optimistic tone regarding gas usage projections, saying “it is certainly possible that we’ll reach this target faster than what is forecasted.”
However, even if California hits the designated two-year benchmark, the proposal wouldn’t actually initiate an immediate shutdown process. Instead, it would kick off another assessment regarding potentially closing and decommissioning Aliso Canyon.
At a news conference two weeks ago, Stern estimated that Aliso Canyon would close by 2039 at the earliest, under the commission’s plan.
Stern was in San Francisco on Thursday and urged the commissioners to postpone their decision until March 31. He said a regulatory inquiry into possible market manipulation during the gas price spikes that occurred in the 2022-2023 winter season would be complete by early next year. He said he believes the report will provide more information about Aliso Canyon and help assess whether the facility must be kept online to prevent future price spikes.
Matt Pakucko, president of the advocacy group Save Porter Ranch, said he couldn’t understand why the commission didn’t follow through on an earlier proposal to initiate the closure of Aliso Canyon in 2022.
He told commissioners that the decision is not just an energy issue.
“The current biennial proposal puts costs and profits above the health and safety of Californians,” he said.
For now, natural gas usage remains robust in California even though it is decreasing.
The U.S. Energy Information Administration released a report that noted 70% of California households used a gas stove in 2020, among the highest share of any state.
A California Energy Commission review also found that nearly 37% of the state’s electric generation in 2023 was from natural gas.
