SoCalGas North-South Gas Pipeline Project
December 20, 2013, SoCalGas and SDG&E submitted a joint Application
to the CPUC requesting approval to:
North-South Project revenue requirements in customer rates.
related cost allocation and rate design proposals.
Applicants’ proposal purports to address reliability concerns on the
Southern System, and consists of:
60 miles of new pipelines between the town of Adelanto and the Moreno
Pressure Limiting Station
to the compressor station at Adelanto
approximately 31 miles of new pipeline from Moreno to Whitewater
November 12, 2014, SoCalGas and SDG&E submitted an Update
to their proposed Project which removed the Moreno to Whitewater pipeline
component. The proposed Project will connect two existing backbone
transmission facilities and is proposed to transport 800 MMcfd of gas supply
from the northern system to the southern system in the event of low deliveries
at Blythe and/or Otay Mesa receipt points.
The utilities forecast for revenue requirement estimates to be:
full year the Project is in service = $133.6 million
for Entire operating service life of the Project = $2.78 billion
amount requested for rate recovery is based on actual costs that will be
incurred, not the estimated costs which are presented in the application. The
Project has no proposed cost cap. If approved, the proposed Project could
increase the SoCalGas Backbone Transmission Service (BTS) rates by 81.3% over
CPUC Scope and Schedule
March 9, 2015 the CPUC issued an amended Scoping
Memo and Ruling with updates to the
CPUC Proposed Decision
On April 5, 2016, the
CPUC issued a Proposed Decision denying the utilities' request to recover the costs of constructing the North-South natural gas pipeline. The Proposed Decision finds that there are more reasonable and cost-effective alternatives to enhance supply reliability to the Southern System.
Hearings were held at the CPUC for July 7-10, July 20-24, and
August 10-12, 2015.
ORA's Policy Position
ORA supports the CPUC's Proposed Decision, which comports with ORA's
recommendation that the CPUC should deny SoCalGas’ request to implement the proposed
North-South Project and instead find that SoCalGas/SDG&E failed to
demonstrate that it is necessary to build this pipeline project in order to
address the SoCalGas Southern System supply-related reliability issue.
also recommended that the CPUC should:
a broad range of non-physical “no-build” alternatives to address the
SoCalGas Southern System minimum requirements and long-term reliability
before considering and authorizing any physical infrastructure alternatives.
the cost of non-physical alternatives to the Backbone Transmission Service
(BTS) and share these costs across all customers of SoCalGas, consistent
with how cost allocation is currently done.
should the CPUC find that a physical infrastructure alternative is necessary in
order to address supply-related SoCalgas Southern System reliability issue, then
it should order SoCalGas/SDG&E to:
first the demand criteria used to determine the amount of capacity needed
and negotiate with interested interstate pipeline company who offers the
safest and most reliable service at the lowest reasonable cost.
an incremental ratemaking treatment for a physical infrastructure
alternative where only those who have need for the physical project should
pay for it.
ORA's May 8, 2015 Testimony:
the Proceeding docket.
at the docket for proceeding updates.