Aliso Canyon gas storage facility to stay open for now, state body decides

More than nine years after the Aliso Canyon underground natural gas storage facility in the San Fernando Valley became the site of the largest methane leak in U.S. history, a state commission on Thursday, Dec. 19, backed a controversial proposal that critics say will delay the facility’s closure by many years or, worse, indefinitely.

In a 4-0 vote with one commissioner recusing himself, the California Public Utilities Commission (CPUC) approved an administrative law judge’s proposed decision that Aliso Canyon should, for the time being, remain open for energy reliability reasons – and to keep energy costs down.

While the facility operates for now, the commission said Thursday’s vote also created a pathway to lowering or eliminating reliance on the Aliso Canyon facility in future years by establishing a “natural gas peak day demand target.”

That’s the level the commission believes the demand for natural gas in Southern California can be met without the need of Aliso Canyon.

The CPUC agreed that two years out from when the peak day demand forecast is projected to drop to 4,121 million metric cubic feet per day — and if a biennial assessment suggests Aliso Canyon could be shut down without putting energy reliability for customers at risk, or result in unreasonable rate hikes for customers — the commission could start to consider closing the gas storage facility.

“This decision puts forward a path to the closure of Aliso Canyon that is achievable, realistic, and protective of families and businesses who are struggling to pay energy bills,” CPUC President Alice Reynolds said in a statement.

“Huge progress is underway to bring online clean energy resources and drive down demand for natural gas-fired power plants,” Reynolds added. “There also are over a dozen local, regional, and federal incentive programs for electric appliances in Southern California—the more consumers reduce use of natural gas, the faster Southern California will reach the natural gas target established in this decision.”

But those who disagree with the CPUC’s vote to keep Aliso Canyon running say the facility is no longer needed.

Moreover, they believe that waiting until the projected peak day demand for natural gas falls to 4,121 million metric cubic feet per day before considering shutting down the facility would allow SoCalGas to keep it running for at least another decade, if not longer. Some fear it might never close.

The peak day demand for this year was forecasted at 4,618 million million metric cubic feet per day, and it’s not expected to drop to 4,121 million metric cubic feet per day until after 2030.

Craig Galanti, a Porter Ranch resident living near the Aliso Canyon facility, was unhappy with the CPUC vote.

“Am I surprised? No. Am I disappointed? I’m exceedingly disappointed,” he said. “The CPUC continues to support the best interests of the utilities at the expense of the community’s health and safety.”

The 2015 gas leak that spewed nearly 100,000 metric tons of methane into the air forced 32,000 residents in Porter Ranch, Granada Hills, Chatsworth and several other communities in the San Fernando Valley to evacuate.

Many complained of nosebleeds, dizziness and respiratory issues. Years later, UCLA researchers found that pregnant women living near Aliso Canyon during and after the blowout were more likely to have premature births and low-weight newborns.

In 2017, then-Gov. Jerry Brown directed the CPUC to draft a plan to shut down the Aliso Canyon facility by 2027. Gov. Gavin Newsom in 2019 directed the CPUC to expedite the closure.

But five years after Newsom’s directive, Aliso Canyon continues to operate.

Environmentalists and residents near Aliso Canyon who for years have demanded the facility be shut down called Thursday’s CPUC decision a major setback.

Earlier this week, the lobbying arm of Food & Water Watch, a national advocacy group, launched a six-figure ad criticizing Newsom, whom the group accused of walking back his position to expedite the closure of Aliso Canyon.

The 30-second ad ran in four states that are important to presidential hopefuls – New Hampshire, Michigan, South Carolina and Nevada. Newsom is widely believed to have presidential ambitions.

Andrea Vega, a senior organizer with Food & Water Watch in Southern California, said although Newsom previously directed the CPUC to expedite the shutdown of Aliso Canyon, he has since been quiet on the issue and has failed to hold the CPUC accountable.

She criticized the proposal that the CPUC adopted on Thursday because it does not set a definitive date for when Aliso Canyon shall shut down.

And because the governor appoints commissioners to the CPUC, Vega said Newsom must share in the blame.

“He has had all of this time, all of these years … to have his commission take action and to create a plan to close down Aliso Canyon,” Vega said.

She added, “It’s absurd that it’s taking this long still and that he is not coming out and saying anything – especially at a time when Gov. Newsom has been very vocal on the national stage, trying to position himself as a climate champion. … California needs climate leadership. Our nation needs climate leadership. And we’re still looking for it. I’m not seeing that in Newsom right now.”

Newsom issued a statement after the CPUC’s vote on Thursday, saying that Aliso Canyon must be shut down permanently – but that it would be “reckless and irresponsible to burden working families” with skyrocketing price hikes and without the guarantee of reliable energy.

“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,” Newsom said.

He also addressed those who live near Aliso Canyon who have demanded the facility’s closure.

“To the communities surrounding Aliso Canyon, I hear you. Your safety is paramount. That’s why the state has worked extensively with our local and federal partners to ensure the facility is safe with new protocols and rigorous testing,” Newsom said.

SoCalGas, which operates Aliso Canyon, issued a statement ahead of Thursday’s CPUC vote.

“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,” the statement read.

A number of business organizations have also come out in support of keeping Aliso Canyon open for the time being.

In a letter to the CPUC this week, a coalition of business organizations said some companies in the state saw their energy bills rise 300% during last year’s winter price spike.

Given that Aliso Canyon provides up to 60% of Southern California’s daily natural gas needs during peak periods, the facility helps prevent further price volatility, the business groups said.

“The facility’s role in maintaining grid reliability cannot be overstated, particularly as our state continues to integrate increasing amounts of renewable energy. … The governor’s support for maintaining strategic natural gas infrastructure, while simultaneously advancing renewable energy projects, represents the kind of practical policy-making our state needs,” their letter stated.

The letter was signed by about a dozen business organizations including the California Business Roundtable, Los Angeles County Business Federation (BizFed), Inland Empire Economic Partnership, Orange County Business Council and Bay Area Council.

Meanwhile, a group of more than 100 scientists sent their own letter to the governor recently. Citing public health concerns and other reasons, they urged Newsom to order the CPUC to shut down Aliso Canyon by 2027 or earlier.

Mark Jacobson, a professor of civil and environmental engineering at Stanford University, wrote in the letter that nearly half of the grid and non-grid electricity demand in the state is being met through solar, wind, hydroelectric and geothermal electricity, and that at the current pace of growth, such forms of electricity should approach 100% by 2030 or earlier.

“Fossil gas use in the state is declining rapidly, and there is certainly no need for the large amount of gas stored at Aliso Canyon,” Jacobson wrote.