The utility plans to start work early next year but critics say the project is too expensive, not needed
Early next year, San Diego Gas & Electric plans to break ground on a $677 million project to repair or replace a 70-year-old natural gas line that covers about 50 miles and runs roughly along Interstate 15.
But a coalition of environmental and consumer groups have filed a petition with the California Public Utilities Commission, demanding a review of the project, saying it is too expensive and claiming some portions of the line do not need to be replaced.
“There are a lot of people living along that corridor and the disruption that will be caused by replacing most of the line along that pathway will be impressive,” said Bill Powers, board member for the Protect Our Communities Foundation, one of four groups filing the petition. “It would add insult to injury when the pipe is in very good condition and capable of operating in its current condition for many more years without replacement or upgrading at a time when our natural gas usage is declining.”
But SDG&E officials say 37 miles of the 16-inch-wide pipeline — called Line 1600 — should be replaced while the remaining 13 miles will undergo high-pressure hydrostatic testing to make sure they meet integrity standards. The public utilities commission’s Safety and Enforcement Division signed off on the plan earlier this year. The line dates back to 1949.
“There’s no merit to the opponent’s filing,” SDG&E spokeswoman Jennifer Ramp said. “They’re asking the (utilities commission) to go against their own Safety Enforcement Division’s approval to this test and replace plan, to rehash the same issues that have been scrutinized for nearly four years.”
Line 1600 runs from Rainbow Station in the north to Mission Station in the south. While it provides only about 10 percent of capacity for the San Diego area, the pipeline is critical because it’s the only supply of natural gas for about 150,000 customers in eastern Fallbrook, Valley Center, Escondido, Rancho Bernardo, Rancho Peñasquitos, Poway, Scripps Ranch, Kearny Mesa and Serra Mesa.
After a Pacific Gas & Electric natural gas pipeline explosion in San Bruno killed eight people in 2010, new regulations were passed requiring California’s investor-owned utilities to replace or pressure-test all their gas lines.
SDG&E originally wanted to replace almost all of Line 1600 with a 36-inch-wide line, but last year the utilities commission in a 5-0 vote turned down the plan, saying it was not needed.
The commission, known as the CPUC for short, told SDG&E to come back with other alternatives and gave the utility two options: testing the entirety of Line 1600 or replacing segments of the line in highly populated areas and pressure-testing the rest.
The utility pitched four proposals and earlier this year, the CPUC’s Safety Enforcement Division approved a “hybrid plan” to replace 37 miles of Line 1600 and test the other 13 miles.
SDG&E and its sister utility, Southern California Gas, expect to begin construction on the project in the first quarter of 2020. SDG&E and SoCalGas are subsidiaries of Sempra Energy, the San Diego-based Fortune 500 company.
SDG&E estimates the $677 million project works out to a 1.2 percent increase in the monthly bills of a typical customer using 24 therms of gas, which translates to 42 cents more per month.
Under the plan, crews will replace segments of Line 1600 at 14 sites in more populated areas and hydro-test the line in five sites located in more rural areas. The entire project is expected to take about four years to complete.
A 2.2-mile segment on Midway Drive in Escondido is scheduled to go first, some time in the first three months of 2020. Three other segments, including one near the intersection of Scripps Poway Parkway and Interstate 15, will follow later in the year.
Powers called the project’s price tag “extravagant,” saying the 13-mile stretch slated for hydrostatic testing works out to about $2.4 million per mile. Powers pointed to 2011 estimates on a different project by SoCalGas and another by PG&E that came to $500,000 per mile, at the upper end.
The hybrid project’s overall cost of $677 million exceeds the $639 million estimate SDG&E gave to the CPUC to replace the entire line.
“How is it possible that an existing line is going to be more expensive than building an entirely new, much bigger pipeline (36 inches wide compared to 16 inches) along the same track?” Powers said. “That doesn’t make any sense.”
The Safety and Enforcement Division and SDG&E said earlier this year the $639 million figure came from an old estimate made four years ago. Since then, prices for steel, material and labor have gone up. In addition, the 36-inch proposal did not include the southernmost five miles of Line 1600.
“Each project is different, and estimates must be based on the specific work associated with that project, not outdated generic cost figures that are not specific to this work,” Ramp said, adding that based on the current estimates, the cost of hydro-testing Line 1600 by itself is estimated at $325 million when all costs are included.
Powers also complained most if not all of the 37-mile section of Line 1600 scheduled for replacement does not need it, even if the pipeline is seven decades old.
“Natural gas pipelines, if they’re properly built, can last indefinitely,” Powers said.
The CPUC administrative law judge who recommended rejecting the 36-inch pipeline project last year said in her proposed decision, “Pipeline vintage or age alone should not be the deciding factor in determining how long a pipeline should remain in service. According to reputable industry studies, new pipelines also pose risks.”
SDG&E points to a July 2016 directive from the CPUC, telling the utility to reduce pressure on Line 1600 “to ensure additional safety margins.” The commission’s executive director said at the time while no data on the line “show conclusively” the the 70-year-old line is unsafe, it mandated pressure on the line be reduced by 20 percent.
Ramp said there are “anomalies” with Line 1600. Since the 70-year-old line was originally manufactured “using methods that are now obsolete,” Ramp said the line contains “hundreds of “seam weld flaws that, although currently considered to be stable, may lead to failure” in the future.
“We need to comply with the law and that is what the (Safety Enforcement Division) has approved — testing and replacing this line so that it can stay in service as a transmission line.”
The groups opposed to the project want the CPUC to reopen the case. SDG&E is expected to file its response by July 1. There is no specific time frame in which the CPUC must decide whether to accept or deny the petition.
Ramp said the project is still scheduled to start in the first three months of 2020 but if the CPUC decides to reopen the case, it would “absolutely” result in a slowdown. “It would extend the process and delay what we believe (is) critical safety work from starting next year.”
Protect Our Communities is one of four parties that filed the petition, joining the Sierra Club, the consumer advocacy group The Utility Reform Network (known as TURN) and the utility consumer group Southern California Generation Coalition.