Aliso Canyon Well Failure Order Instituting Investigation

Aliso Canyon Investigation

On February 9, 2017, the CPUC opened a proceeding (called an Order Instituting Investigation; I.17-02-002) to determine the feasibility of minimizing or eliminating the use of Southern California Gas Company’s Aliso Canyon Natural Gas Storage Facility while still maintaining energy and electric reliability for the Los Angeles region.

A final decision in this proceeding is expected mid-2018, but the CPUC has slated a 24-month timeframe from opening of the proceeding in February 2017 to complete all work.

The purpose of the proceeding is to examine the long-term viability of the Aliso Canyon gas storage facility. The scope of the proceeding does not include the question of whether the facility should be reopened for injections, but rather the long-term feasibility of minimizing or eliminating the use of the facility while still maintaining energy and electric reliability for the Los Angeles region, consistent with maintaining just and reasonable rates.

Senate Bill 380 required the CPUC to open this proceeding no later than July 1, 2017, and to consult with the State Energy Resources Conservation and Development Commission, the California Independent System Operator, the local publicly owned utilities that rely on natural gas for electricity generation, the Division of Oil Gas and Geothermal Resources in the Department of Conservation (DOGGR), and relevant government entities, and others in making its determination. The CPUC expects and welcomes involvement and input from a wide range of interested entities to inform its decision-making process.

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Background on Aliso Canyon Leak

On October 23, 2015, Aliso Canyon began to leak natural gas from its underground storage facility located near Porter Ranch, Calif. Upon discovery and reporting of the leak, multiple agencies began to work with Southern California Gas Company to remedy the situation and investigate its cause. On January 6, 2016, Governor Edmund G. Brown Jr. issued a proclamation declaring the gas leak an emergency and setting forth several orders to mitigate damage, including requiring Southern California Gas Company to maximize daily withdrawals of gas for use or storage elsewhere, a prohibition of any further injection into the storage facility until comprehensive review of the safety of the wells and the air quality of the surrounding community was completed, and ensuring that Southern California Gas Company bears responsibility for the costs related to the natural gas leak and strengthening oversight.

DOGGR has primary jurisdiction over the well and is focusing an investigation on the mechanical and operational condition of the well to determine the cause of well failure and the subsequent natural gas leak. The CPUC has jurisdiction over the above ground infrastructure beginning where the storage facility connects to the pipeline, or “at the wellhead.” In addition, the CPUC has jurisdiction over the recovery of costs related to the storage facility as well as ensuring that Southern California Gas Company provides safe, reliable service at just and reasonable rates.

The CPUC and DOGGR are conducting their respective investigations in parallel as part of a collaborative effort. The CPUC and DOGGR jointly directed Southern California Gas Company to retain an independent, third-party to perform a technical root cause analysis of the well to protect against future failures. At the conclusion of the investigation, the CPUC will have several enforcement options, depending upon what violations, if any, are identified. The options can include issuance of a staff Citation or opening a formal CPUC proceeding to consider fines and penalties.

The CPUC will address costs and cost responsibility related to the leak in a future proceeding. On December 23, 2015, the CPUC sent a letter to Southern California Gas Company directing it to track all costs associated with its actions related to the leaking well and to make that cost information publicly available.


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