The California Public Utilities Commission (CPUC) on August 31 voted unanimously to approve an increase in the maximum natural gas storage capacity at SoCal Gas’s Aliso Canyon facility in Los Angeles County to 68.6 Bcf, from the previous cap of 41 Bcf, in an effort to alleviate price spikes and blackouts.
The field has a maximum storage capacity of 86 Bcf — making it the largest of any storage field in the entire U.S. western region. However, it was the site of a massive four-month-long gas leak discovered in 2015. The incident resulted in the field being shut in for nearly two years. When it was deemed safe for operation in July 2017, the CPUC put in place withdrawal protocols and ordered that the facility be treated as an “asset of last resort” for withdrawals. CPUC eased the withdrawal protocol in June 2018 and allowed the facility to increase the maximum allowable storage capacity to 34 Bcf, citing pipeline constraints for access gas supply in Southern California. In 2021, that limit was increased to 41 Bcf. That year, Pacific Gas and Electric (PG&E) reclassified 51 Bcf of working gas capacity to base gas, further reducing access to storage gas in the state.
In addition to the storage limitations, the Golden State has experienced radical shifts, from the permanent shutdown in 2013 of the 2,250-MW San Onofre nuclear facility — a major power source for the Los Angeles metro area at the time — to an aggressive expansion of renewable energy (first wind, then a lot of solar), which also involved shutting down older, less-efficient gas-fired power plants. The increased market share of renewables, along with limited storage injection/withdrawal capacity, droughts, extreme weather and worsening transportation constraints in recent years, have brought on gas and electricity shortages and increased price volatility in the local gas markets.
