Californians were shaken down by the likes of Enron and other energy pirates at the turn of this century through Blackout Blackmail. The energy pirates and utilities said ratepayers needed to pay more or the lights would go out, and the state and its regulators were complicit.
A report out from the state energy regulators today smacks of the same Blackout Blackmail. It claims that without Southern California Gas's storage at Aliso Canyon running full tilt, there's "a distinct possiblity of electricity service disruptions in the coming months." State energy regulators secretly worked with LADWP on an analysis that appears to vastly undercount gas and electricity capacity in Southern California and overstate risk to the grid.
The assumptions and numbers appear cooked to make the public fear blackouts by underestimating natural pipeline gas capacity in Southern California and overestimating the value of Aliso to electricity generation in the basin. Engineer Bill Powers takes on the phony assumptions behind the state report in more detail on this morning's Larry Mantle Show, arguing in part:
The LA basin of SoCalGas (Southern California Gas) has never hit its firm capacity during the summer peak - which is the focus of this clamor of summer blackouts caused by Aliso Canyon.... That's why I see this as crying wolf and locking arms around a concept that Aliso Canyon must remain online - and doing it with poorly supported justifications......
"They can configure how they operate their system and require of their big non-core customers - who are taking advantage of the abundant storage that SoCalGas has - to trade and work with their gas supplies to absolutely minimize the price that they pay for gas. And at the same time, the primary core customers - the homes and the small businesses - are the ones that are paying the approximately $40 million a year by my estimate to maintain Aliso Canyon to keep it operational. And the customers that live near that facility in Porter Ranch are the ones who are taking most of the physical risk. That is being borne not by the primary beneficiaries which are [non-core] customers, that's being borne by the little guy.”
The report done in secret, without an open investigation requested by Consumer Watchdog and Aguirre & Severson, is designed to allow So Cal Gas to get what it wants. That is expansion of Aliso Canyon natural gas storage paid for by ratepayers that best protects the investors of Southern California Gas's parent company SEMPRA, on whose board Governor Brown's sister Kathleen sits.
An initial review suggests the data assumptions seem to come right from the utilities’ accountants without any real scrutiny by the state. The fact is there's plenty of natural gas in Southern California pipelines. It's all about allocations of that natural gas and the utilities' assumptions about that allocation. The contracts behind them should be justified to the public and the legislature.
These are complicated issues, but what's clear is public scrutiny is needed more than ever. The assumptions delivered today are designed to spark fear meant to keep Aliso open rather than challenging the utilities' allocation of current natural gas in pipelines that is more than ample to fulfill the state's needs without risking the dangers posed by Aliso's operations.
