June 19–The fate of a 47-mile natural gas pipeline that San Diego Gas & Electric wants to construct between Rainbow and Miramar is on the line Thursday when the California Public Utilities Commission (CPUC) is scheduled to vote on it.
SDG&E says the new pipeline would largely replace an old line that was constructed nearly 70 years ago but a CPUC administrative law judge last month recommended commissioners reject the utility’s plan.
And there’s more: Should the CPUC accept the administrative law judge’s recommendation, the old pipeline will have to undergo a high-pressure water test that SDG&E says will be expensive and could impact as many as 125 homes and structures near the path of the existing line. At least one critic of the utility said SDG&E is overstating the expense.
The proposal for a new pipeline
SDG&E wants to partner with Southern California Gas to replace a 16-inch pipeline — called Line 1600 — that runs along the Interstate 15 corridor with a 36-inch line that runs north-south and goes past a number of parcels of land and communities, including Escondido and Poway. The 16-inch line has been in service since 1949.
The utilities have estimated the project will cost $639 million, paid for by ratepayers. Typical residential customers are estimated to see a 1.7 percent increase in their monthly bills, which works out to 57 cents more.
The utility said the route for the proposed pipeline — Line 3602 — would follow streets in order to avoid private properties.
“Fundamentally, this application project is about safety, compliance and what is the best investment of ratepayer customer resources,” said Jimmie Cho, SDG&E senior vice president.
But the administrative law judge assigned to the case didn’t buy the argument.
SDG&E and SoCalGas “have not shown why it is necessary to build a very costly pipeline to substantially increase gas pipeline capacity in an era of declining demand and at a time when the state of California is moving away from fossil fuels,” Colette E. Kersten wrote in a 130-page proposed decision released on May 2.
Opponents of the pipeline project want the CPUC’s five commissioners, who have the final say, to follow Kersten’s recommendation when the commission meets Thursday in San Francisco.
“The proposed decision was very clear; (the pipeline) is not needed and it’s inconsistent with the state’s clean energy and climate goals,” said Masada Disenhouse, co-founder of San Diego 350, an environmental group that held a rally Sunday at Mission Trails Regional Park that attracted about 100 demonstrators.
Under California’s Renewables Portfolio Standard, power companies are required to derive 50 percent of their energy from renewable sources by 2030. Natural gas burns twice as clean as coal, but it is a fossil fuel.
SDG&E has dubbed the proposal the “Pipeline Safety and Reliability Project” and utility officials say the larger pipeline will improve safety, system reliability and resiliency while also adding capacity to the gas system in the San Diego area.
The 16-inch pipeline provides only 10 percent of SDG&E’s demand while another line — a 30-inch pipeline called Line 3010 — provides the remaining 90 percent. But the utility said the project is needed to make sure there is no shortfall of gas in case Line 3010 ever goes out of service.
Lori Holt-Pfeiler, who served as mayor of Escondido from 1998 to 2010, is in favor of building the pipeline, saying it’s a better use of money in the long run.
“It’s a 70-year-old pipe(line) and no matter what you do to that pipe — to fix it, to test it, do whatever — you’re still going to have an old pipe that’s not going to last that long,” Holt-Pfeliler said. “A face-lift is not going to make this pipeline any younger.”
Should the commission approve the project, SDG&E will still keep the old 16-inch pipeline in the ground, lowering the pressure in the line and converting it from a transmission to a distribution line.
“Pipeline safety experts testified and all agree that lowering the pressure of Line 1600 reduces the risk of rupture of all causes, including third-party damage,” Cho said. “Simply abandoning Line 1600 is not an option because it serves approximately 150,000 customers, as well as playing a critical role in SDG&E’s gas system.”
That rankles April Maurath Sommer, executive director and lead counsel for the Protect Our Communities Foundation, an environmental group based in San Diego County that opposes the project.
“They want their cake and they want to eat it, too,” Maurath Sommer said. “They want two lines here, far more capacity than is needed.”
The testing flap
In the aftermath of a Pacific Gas & Electric natural gas pipeline explosion in San Bruno in 2010 that killed eight people, the state Legislature passed new regulations, including replacing or pressure-testing gas lines.
Given the age of Line 1600, SDG&E opted for replacing the old pipeline with the project to build a 36-inch line.
But in addition to recommending the $639 million project be shelved, Kersten called on the utility to conduct a “hydrostatic,” high-pressure water, test of Line 1600.
SDG&E officials say testing the existing line could take four years to complete.
“Because we only have two transmission lines feeding the system, we can’t do this work continuously,” said Estela de Llanos, SDG&E’s director of major projects. “We have to wait until the demand on the system is very low. So it’s not four years of continuous construction. It’s four years in what we call the shoulder months (in the fall and spring), when demand is low.”
The utility originally estimated the cost of a test of Line 1600 would would cost $130 million that would be passed on to ratepayers but now says the price tag will be closer to $200 million.
SDG&E says the proposed decision provides two options:
* testing the entire 50-mile pipeline, or
* replacing segments of the pipeline in highly populated areas and pressure-testing the rest.
There are also an additional five miles that need to be tested and SDG&E says at least 77 locations in Line 1600 need to be cut out and reconfigured so the line is straighter for inspection tools to navigate through.
Sommer Maurath did not dispute that a high-pressure test may take up to four years to complete but said the original $130 million estimate was over-exaggerated and called the $200 million price tag “completely out of whack.”
“Their newly inflated costs are completely fictional and are clearly a Hail Mary attempt to resuscitate a dying project,” Sommer Maurath said.
SDG&E officials also say a high-pressure test of the line could affect as many as 500 properties along the existing pipeline, including 125 homes and other structures. That’s largely due to development that has been built around the area since the pipeline was put in place in 1949.
“The population of the county was less than 300,000 people, less than a tenth of what it is today,” de Llanos said. “There was not very much out in this area (in 1949), other than the city of Escondido.”
Sommer Maurath said if SDG&E had started testing the line a few years ago, “pursuant to the PUC’s orders” in the wake of the San Bruno explosion, “they would have finished already.”
SDG&E and SoCalGas are subsidiaries of San Diego-based Sempra Energy, a Fortune 500 company with investments in other locations beyond California.
Sempra’s subsidiary in Mexico is operates a liquefied natural gas (LNG) facility near Ensenada and is considering expanding it to include an export component to send LNG cargoes to markets in the Pacific.
The Protect Our Communities Foundation has speculated that’s the real reason behind the pipeline project. “They could use that excess capacity to get that gas down to Mexico to that LNG export facility,” Sommer Maurath said.
Cho called the assertion “absurd.”
“We are barred and limited from having interactions with any of the affiliates” of Sempra, Cho said. “So the decisions we’re making are based solely on what we believe is right for the region and the customers of San Diego.”
Kerster’s proposed decision also rapped the knuckles of SDG&E and SoCalGas, saying “it is clear” the utilities “did not aggressively and diligently” take the necessary steps to “ensure timely updates of Line 1600 pipeline data” to parties taking part in the debate over the 36-inch pipeline project.
The utilities disputed the claim, saying they “did not deliberately suppress evidence or evade” requests for data but admitted they “could have been more explicit in communications.”
Kerster called on the two utilities to hire an independent bidder at their own expense to perform an audit on the records used to track data on Line 1600.
“I stated this before the commission,” Cho said, “we welcome any auditor coming in and we’ll gladly cooperate and support the audit process.”
The pipeline project is listed on the commission’s Thursday agenda but it is not unusual for items to be put on hold.
For example, four times last year the CPUC delayed taking a vote on SDG&E’s request to bill customers $379 million in costs associated with the 2007 wildfires that ripped though the San Diego area. The commissioners eventually ruled against SDG&E’s bid.
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