SDG&E and SoCalGas Pipeline
Safety & Reliability Project - Line 3602
Certificate of Public Convenience and Necessity (CPCN)

 

Background

On September 30, 2015, SDG&E and SoCalGas submitted a joint Application to the CPUC requesting approval for:  

  • A CPCN authorizing SDG&E to construct the proposed project.     
     
  • Recovery of the project revenue requirements in customer rates.

The Applicants’ proposal purports to address safety, reliability, and system capacity concerns and consists of: 

  • Construction of Line 3602:   A new 47-mile long, 36-inch natural gas transmission Pipeline from Rainbow Station to Miramar in San Diego County. 
     
  • Line Replacement:  Line 3602 would replace a 16-inch natural gas transmission pipeline from Rainbow Station to Miramar, which will be downgraded to a lower-pressure distribution pipeline.      

The utilities estimate construction costs to be $596 million with a forecasted annual revenue requirement of $82.7 million. However, the amount requested for rate recovery is based on actual costs that will be incurred, not the estimated costs 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 45.3% over current levels. BTS rates are applied to both SDG&E and SoCalGas customers, as the CPUC set a “postage-stamp” style system where customers pay a common rate to deliver gas from the Citygate to any receipt point.

 

Utilities' Amended Application 

On January 22, 2016 the CPUC issued a Ruling updating the proceeding schedule, and requiring the utilities submit an amended Application by March 21, 2016.

 

Utilities' Supplemental Testimony

On February 21, 2017, in response to the CPUC’s Ruling ordering supplemental testimony on safety, SoCalGas/SDG&E served supplemental testimony on the safety of Line 1600.

 

ORA’s Position

ORA has reviewed the SDG&E/SoCalGas' amended application and recommends that the CPUC deny the utilities’ request to approve the CPCN to construct the Line 3602 Pipeline because SoCalGas and SDG&E have failed to demonstrate that the pipeline is necessary to address the SDG&E Southern System safety, reliability, and system capacity issues.

Specifically, as directed by the CPUC's January 2016 Ruling, the utilities fail to:

  • Provide specific Ten-Year forecasted information regarding the area served by proposed Line 3602 
      
  • Provide Ten-Year historic monthly daily annual maximum volumes through Line 1600 
      
  • Use the Proponent’s Environmental Assessment (PEA) definitions in SoCalGas/SDG&E’s comparison for cost effectiveness of other alternatives.

Additionally, ORA filed a Motion to Dismiss the Application for Line 3602, and requested the CPUC order the utilities to pressure test Line 1600 as soon as possible. SoCalGas/SDG&E’s costs would be subject to reasonableness review.  

 

On December 6, 2016, ORA and other intervenors filed a joint motion to postpone phase 1 briefs until after testimony and hearings, and to amend the scoping memo to focus on Line 1600 safety.

 
In Testimony, ORA found that Line 1600 remains a transmission line, even if derated to 320 psig as proposed by SoCalGas/SDG&E. To ensure safety, ORA recommended a pressure test of Line 1600 and that the Line remained managed under more stringent Transmission Integrity Management regardless of whether Line 1600 is transmission or distribution.

 
Regarding alternatives to the Proposed Line 3602, ORA recommended further and fuller examination of the availability and cost of gas of the Otay Mesa receipt point (between California and Mexico).

 

See ORA's:  

October 30, 2015 initial Protest to the Application  

April 21, 2016 Protest to the Amended Application

June 17, 2016 Motion to Dismiss the Line 3602 Application

 

December 6, 2016 Motion to Postpone Briefs and Amend the Scoping Memo to Focus on Line 1600 Safety

 
See ORA’s Testimony filed on April 21, 2017. ORA’s testimony consists of the following volumes:

 
ORA-01 (testimony regarding the Otay Mesa receipt point)
ORA-01-SA (public supporting attachments)
ORA-02 (June 2017 amended testimony regarding safety)
ORA-02-SA (public supporting attachments)
ORA-02-C (confidential supporting attachments; this testimony is not publicly available)
ORA-03 (testimony regarding outages on Line 3010 and the Moreno Compressor Station)
ORA-03-SA (public supporting attachments)
ORA-04-SA (Additional supporting attachments to ORA's amended testimony)


Additionally, ORA served a motion to admit second amended testimony and supplemental testimony on September 14, 2017. The motion has not been granted as of September 22, 2017.

 
ORA-27 (public supplemental testimony on safety)
ORA-27-SA (public supporting attachments)
ORA-27-C (confidential supplemental testimony on safety; this testimony is not publicly available)
ORA-27-SA-C (confidential supporting attachments this testimony is not publicly available)

 

CPUC Proceeding Docket

See the Proceeding docket to find a record of the case.

Here you can subscribe to regular proceeding updates.

 

Other Resources

SDG&E and SoCalGas Testimony and Workpapers