San Diego Union Tribune
May 2, 2018

A California Public Utilities Commission (CPUC) administrative law judge on Wednesday called on the five members of the commission to reject a proposal by San Diego Gas & Electric to build a 47-mile natural gas pipeline between Rainbow and Miramar.

SDG&E wants to partner with Southern California Gas to replace a 16-inch pipeline that runs along the Interstate 15 corridor with a 36-inch line. The two utilities are subsidiaries of Sempra Energy, a Fortune 500 company based in San Diego that operates natural gas-fired power plants, pipelines and storage facilities.

But in a 130-page proposed decision issued by Colette E. Kersten, the utilities “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.”

The recommendation calls on SDG&E to pursue options for supply that may be needed in smaller amounts and for shorter periods of time.

Critics of of the pipeline project, which include environmental and consumer groups, hailed the proposed decision.

“This project was always a boondoggle. It never made any sense,” said Matt Vespa, staff attorney for clean energy at Earthjustice.

An SDG&E spokesperson late Wednesday afternoon said the utility’s officials are “disappointed” with the proposed decision.

“This draft decision puts San Diego at risk and prevents us from investing in the modern infrastructure that this region deserves,” said communications manager Jennifer Ramp.

The project “is a critical infrastructure project that is needed to enhance safety of the natural gas system so that we can continue to meet the energy needs of approximately 880,000 customers including hospitals, the military, schools, universities, biotechnology, hotels and restaurants,” Ramp said in an email.

The proposed decision heads to a vote by the CPUC’s commissioners, which may come as early as June 21.

“This was an extremely detailed, well thought-out and lengthy decision, said April Maurath Sommer, executive director and lead counsel for the Protect Our Communities Foundation, an environmental group based in San Diego County that opposed the project. “The (administrative law judge) has done an excellent job in taking on all facets of a very complicated issue and I think the commissioners would have a hard time not finding this to be a credible and defensible proposed decision.”

SDG&E wants to build the 36-inch pipeline — more than twice the size of the old pipeline — to improve system reliability and resiliency, modernize the existing line and add capacity to the gas system in the San Diego area.

The project was estimated to cost $639 million, paid for by ratepayers. SDG&E last year estimated typical residential customers would see a 1.7 percent increase in their monthly bills, which works out to 57 cents more.

The proposed pipeline criss-crosses a number of parcels of land and communities, including Escondido and Poway.

The existing 16-inch pipeline has been in service since 1949. Kersten acknowledged the age of the pipeline but said that should not be the sole, deciding factor in determining whether it should stay in service.

“According to reputable industry studies, new pipelines also pose risks,” Kersten wrote.

Kersten ruled the most recent natural gas supply forecasts by utilities, as well as the CPUC’s reliability standard for natural gas planning, do not demonstrate a need for the project SDG&E has dubbed the “Pipeline Safety and Reliability Project.”

The proposed decision comes as the California, under its Renewables Portfolio Standard, requires power companies to derive 50 percent of their energy from renewable sources by 2030. While natural gas burns twice as clean as coal, it is a fossil fuel.

In addition to recommending the CPUC turn down the pipeline project, Kersten’s order also called for SDG&E and SoCalGas to perform a hydrostatic — or water-pressurized — test of the 16-inch line to determine strength and potential leaks. SDG&E has estimated such a test would cost more than $130 million.

The 16-inch pipeline — known as Line 1600 — provides about 10 percent of SDG&E’s demand while a 30-inch pipeline — called Line 3010 — provides the remaining 90 percent. But the utility said Line 1600 should be replaced to ensure there is no shortfall of gas in case the 30-inch line ever went out of service.

Kerster’s proposed decision also directs SDG&E and SoCalGas to hire an independent bidder to perform an audit on the records used to track data on Line 1600. The Office of Ratepayer Advocates said “the record is replete with evidence that SoCalGas/SDG&E’s safety data is incomplete, incorrect, or missing.”

The utilities disputed the claim. As described in Kester’s proposed decision, SDG&E and SoCalGas said they “did not deliberately suppress evidence or evade” requests for data and admitted they “could have been more explicit in communications.”

Kester’s wrote, “it is clear” the utilities “did not aggressively and diligently “ take the necessary steps to “ensure timely updates of Line 1600 pipeline data.”

The audit of the records will be paid for at the expense of SDG&E and SoCalGas, Kester said.