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CPUC judge rejects proposed gas pipeline

03 May 2018 18:45 (+01:00 GMT)
CPUC judge rejects proposed gas pipeline

Houston, 3 May (Argus) — An administrative law judge for the California Public Utilities Commission (CPUC) has issued a non-binding decision that would reject an application from two Sempra Energy utilities to construct a natural gas pipeline in San Diego county, California.

San Diego Gas & Electric Company (SDG&E) and Southern California Gas Company (SoCal Gas) have proposed building a 47-mile long, 36-inch diameter natural gas transmission pipeline from Rainbow Metering Station in Rainbow, California, to the Marine Corps Air Station Miramar, at a construction cost of $639mn.

The "Pipeline Safety and Reliability Project" would replace a 16-inch natural gas transmission pipeline that currently runs between those two locations, and increase capacity on the San Diego gas system by about 200mn cf/d (6 mn m³/d).

Administrative Law Judge (ALJ) Colette Kersten ruled yesterday that the two utilities had failed to demonstrate a need for the proposed Line 3602 project.

The additional 200mn cf/d of capacity could not be justified on the basis of meeting a "relatively small deficit" of 25mn cf/d or providing overall benefits to ratepayers, the CPUC filing said.

The cost ot maintain the pipeline would be $85.9mn — resulting in a 51pc increase in the Backbone Transportation Service (BTS) charge as early as 2020.

The utilities had also proposed derating the existing Line 1600 from transmission service to distribution service, by lowering the line's operating pressure.

ALJ Kersten denied the utilities' request for a certificate of public convenience and necessity, and ordered that the CPUC's Energy Division cease its preparation of a draft environmental impact report for the proposed project.

The judge has also directed SDG&E and SoCal Gas to perform a hydrostatic test or replacement plan for the existing Line 1600, which was constructed in 1949 and has not been pressure-tested in accordance with modern-day practices and recently-adopted regulations.

The proposed pipeline would cross the cities of San Diego, Escondido, and Poway; unincorporated communities in San Diego county; and federal land.

According to SoCal Gas and SDG&E, the project is designed to confront emergency conditions if Line 3010 or the Moreno Substation experience unplanned outages that place a strain on the system's gas service to core and non-core customers.

Construction of the proposed project would begin in the third quarter of 2019 and would take about 15 to 21 months to complete.

The application and proposed decision may be heard, at the earliest, at the CPUC's 21 June business meeting.