You may have heard or seen media stories regarding the Aliso Canyon Natural Gas Storage Facility and effects it may have on Southern CA utilities in 2016. In an effort to keep you abreast of the issue we wanted to pass along the most current information we have including some history and more specifically the potential impacts on Glendale Water & Power (GWP) and our customers.The following is the background on this matter as well as some frequently asked questions that may arise. We will update you as soon as more specific and detailed information is available and keep in close contact with you throughout the summer.

Background

The Aliso Canyon natural gas storage facility located in Porter Ranch is a critical fuel supply repository and resource owned and operated by the Southern California Gas Company. The facility is a significant source for acquiring natural gas that is used by and critical to many utilities to power their electrical generators and thus produce electricity for the greater Los Angeles basin. The supply is needed to reliably meet high energy demand in the summer months. Aliso Canyon not only augments the current gas that is transmitted via pipeline into the area it is the only gas storage facility that can immediately respond to potentially rapid changes in gas supply demand for the 17 gas-fired generating plants operating within the greater Los Angeles area. Due to the natural gas leak that was discovered in October of 2015, the remedial work to fix the leak and subsequent safety testing at the Aliso Canyon facility, the gas storage units have ceased operation and the facility is no longer taking on new gas injections/storage with supplies drawn down to just 15 billion cubic feet of gas. This situation is expected to last through the summer and beyond as all 114 wells at the site must be inspected and documented as a first step in determining the future use of this facility. As such Glendale Water & Power along with the other area utilities is expecting to encounter gas shortages during the peak summer months creating a possible challenge in providing our customers with reliable electricity this summer. In light of the fact that electrical utilities are considered to be “non-core” customers by SoCalGas these utilities will be the first to face a reduction in gas deliveries due to higher demand and limited gas resources. As mentioned this isn’t just a GWP issue–it is a Southern California issue. The unavailability of this gas supply may cause electrical service interruptions to our customers and other power customers in the Southern California area primarily in Los Angeles and Orange Counties that are served by other municipal utilities (Los Angeles, Burbank and Pasadena) and Southern California Edison. The estimates from reports and an Action Plan compiled by a joint task force including the California Energy Commission (CEC), California Independent System Operator (CAISO), California Public Utilities Commission (CPUC) and the Los Angeles Department of Water & Power indicate that we could experience electrical interruptions for as many as 14 days during this coming summer. This joint task force has worked together to develop a draft action plan that calls for 18 measures to reduce the possibility of electrical interruptions, including a call for greater conservation. The Action Plan and companion Technical Assessment can be downloaded here.

GWP has a strong record of providing reliable power and will do everything possible to reduce and avoid service interruptions. The power system is designed with generation and transmission redundancy, allowing us to avoid electric service interruptions due to an energy shortage or system equipment failure, except under the most extreme conditions. Even during the energy crisis in the early 2000s, GWP secured enough energy to meet customer needs. With that being said, it is pertinent in this gas shortage situation to be on alert, and when the need comes to conserve in order to avoid possible outages.

Key Points

1. GWP is taking all steps possible to ensure electric reliability this summer. However, these measures will reduce, but not entirely eliminate the risk of electrical service interruptions caused by the unavailability of natural gas from the Aliso Canyon gas storage facility in Porter Ranch.

2. This situation is affecting all Southern California utilities.

3. GWP is working closely with state regulatory agencies, other electrical utilities and SoCalGas to reduce the risk of electrical interruptions and preserve reliability this summer.

4. Our biggest concern is for the health and safety of our customers. If conditions do require electrical interruptions, we will provide as much advance notification as possible so that customers can take measures to protect themselves during power interruptions.

5. We encourage customers to do all they can in their homes and businesses to save electricity. The less electricity that is used, the less likely service disruptions will occur.

6. Customers can learn ways to save electricity at www.GlendaleWaterAndPower.com

7. Have a plan of action in place in case power interruptions are imminent. Work with your staff, know all safety procedures and protocols during an outage.

8. While we currently have no specifics as to when an outage might occur, the possible duration, time of day when it could be triggered, etc., we are working diligently on developing system of communication and notification to get the word out to residents and businesses.

Frequently Asked Questions

Q: What is the problem at Aliso Canyon?

A: The Aliso Canyon gas storage facility is owned and operated by the Southern California Gas Company. It was an oil and gas field discovered in 1938 and converted into a natural gas storage facility in 1972. It is located near Porter Ranch. On October 23, 2015, a significant natural gas leak was detected at Aliso Canyon. In response the State’s Division of Oil, Gas and Geothermal Resources then issued emergency orders directing SoCalGas to stop gas injections into the storage facility, and to immediately work on alternatives to stop the leak and seal the broken well. The leak continued for four months before crews were able to repair the well and stop the flow of gas. As a result Governor Brown issued an Emergency Proclamation which included a moratorium on gas injections at Aliso Canyon which in turn curtailed the supply of gas available to all customers

Q: Why would the problem at Aliso Canyon affect utility customers?

A: The Southern California Gas Company delivers natural gas to meet needs such as home heating or cooking and industrial uses as well as to supply fuel for electric generating plants that provide electricity to residential and business customers. The Aliso Canyon natural gas storage facility is critical for meeting high gas demand in the summer months because it provides storage for necessary reserve fuel for electric generation. Aliso Canyon is the only gas storage facility that can immediately respond to potentially rapid changes in gas supply demand for the 17 gas-fired generating plants within the greater Los Angeles area and no other storage facility exists that can reliably serve the needs of so many people and businesses each and every day. Therefore shortages in gas supplies are expected this summer and since electric generating plants are the first to be curtailed under shortage conditions electric utilities in Los Angeles and Orange Counties fully expect to face considerable challenges in maintaining electric supply and reliability this summer. In other words we face the real possibility of experiencing electrical interruptions/outages at certain periods during the coming warmer summer months.

Q: Why does GWP use natural gas for power generation?

A: GWP’s power system includes one natural gas power plant. GWP owns gas-fired generation capacity in the Los Angeles basin, and uses natural gas for a portion of its power supply needs. Newly rebuilt natural gas units generate power more efficiently (using about one-third less fuel per kilowatt-hour generated) than the old turbines they replaced.

Natural gas-fired generating stations are critical to providing reliable power to our customers. Natural gas is the cleanest and most efficient fossil fuel for power generation at this time. It is cleaner than coal, does not produce nuclear waste, and is not impacted by drought conditions. It is used to run power plants at a moments’ notice – unlike renewable energy such as solar and wind, which do not produce energy if the sun does not shine and the wind does not blow. Natural gas power plants are necessary to serve our customers since they can run “all day” or on short notice, when energy demand levels spike and as people return home from work and turn on their air conditioning on hot summer days.

Q: Isn’t GWP increasing renewable energy like solar power? Why do we still need to use natural gas?

A: GWP’s goal is to be coal-free by 2025, and GWP continues to aggressively increase the amount of renewable energy (solar, wind and geothermal power) provided to residents and businesses. GWP is on track to provide 33% renewable energy to customers by 2020, and 50% by 2030 in accordance with State mandates. However, the most abundant renewable resources, solar and wind, are both variable. They do not produce energy on a consistent and constant basis as is necessary to produce a stable flow of power. If the wind is not blowing or the sun is not shining or the power production of these sources is intermittent in any way as it tends to be we need a stable and consistent source of power to regulate and “smooth” the renewable source. Until more storage technology or baseload geothermal power can be developed, natural gas is necessary to firm and back up renewables to ensure continuous, reliable power to our customers 24/7. Batteries are good, but they are not yet ready technologically, to play a major role in the solution.

Q: What is GWP doing to protect customers from power interruptions this summer?

A: GWP is doing everything possible to reduce and avoid electrical interruptions while Aliso Canyon undergoes the necessary safety review. Specific measures include:

  • Working closely with state agencies and other electrical utilities to reduce the risk of electrical interruptions and preserve reliability this summer. The challenges and mitigation measures are described in the Aliso Canyon Action Plan that has been made public.

  • Working with our local power grid operator (Los Angeles Department of Water & Power) and SoCalGas to closely balance natural gas supply and demand needs.

  • Changing operating procedures to maximize flexibility, such as curtailing sales of gas-fired energy to preserve our natural gas supply for critical needs within our service area.

  • Increasing customer outreach and education efforts to urge customers to save energy to reduce demand on hot days – includes participation in a robust “Flex Your Power” Program.

  • Ramping up energy efficiency and demand-response (DR) programs, including several new measures expected to come online this summer.

Q: How will GWP protect hospitals, the elderly, and other vulnerable customers?

A: Hospitals and other emergency/critical facilities may be impacted by electrical service interruptions and will have to rely on their own back-up power generation supply. GWP will conduct outreach and education to prepare our vulnerable customers (those susceptible to heat and/or dependent upon healthcare equipment).For information on what customers can do to help prevent summer outages: http://www.flexalert.org/save-energy or www.GlendaleWaterAndPower.com. Implementing new or expanding existing energy conservation and demand response (where customers are encouraged to reduce or shift electricity usage during peak periods) programs to minimize gas demand.

Q: What are the risks of power interruptions occurring, when would they occur and for how long?

A: GWP is taking all steps possible to ensure electric reliability this summer. However, based on technical analysis by state and local agencies, we believe these measures will reduce, but not necessarily eliminate the risk of gas curtailments large enough to cause electricity interruptions. However, it is too early to know when and for how long an electrical interruption might be necessary. If required, electrical interruptions will be limited only for the minimum duration necessary and may be rotated so that no area or community is unduly or unfairly burdened. Our biggest concern is for the health and safety of our customers. If conditions do require electrical interruptions, we will provide as much advance notification as possible so that customers can take measures to protect themselves during power interruptions.

Q: What can customers do to avoid power interruptions?

A: While the possibility of power interruptions cannot be entirely avoided, customers should respond to peak alerts when issued by turning off all unnecessary lights, postponing the use of major appliances until the evening, and keeping air conditioning thermostats to 78 degrees or higher. Also, there is no better time for customers to implement energy efficiency measures at their homes and businesses. To help better manage energy use, GWP customers can participate in myriad rebates and programs. Visit www.GlendaleWaterAndPower.com for more information.

Q: What is the Aliso Canyon Action Plan?

A: On Tuesday, April 5, the Aliso Canyon Action Plan was released by the joint agency task force. It details significant challenges that Southern California electric utilities face this summer in maintaining electric grid reliability given the uncertain operating status of Aliso Canyon, as well as mitigation measures to help avoid power outages. The media will be briefed on the Action Plan on Tuesday morning and we expect that news outlets will carry stories about it – prompting inquires to utilities from the media and our customers.

Q: Is the plan available to the public?

A: Yes, it has been posted online at http://www.energy.ca.gov/2016_energypolicy/documents/index.html#04082016

Q: What does the Aliso Canyon Action Plan say?

A: The region’s natural gas supply reliability is likely to be threatened from 23 to 31 days this year. Natural gas service could be subject to interruption for as many as 12 to 21 days in a manner that is potentially large enough to force limiting electricity service to customers. It is estimated that as many as 14 days of electrical interruption could occur this summer. This situation could well last through the winter months as well as this is the time when gas demand is highest in response to customers heating requirements. Numerous mitigation measures in the Plan are intended to reduce the likelihood of power outages this summer, including: customer education campaigns; strict new “balancing requirements” for the gas pipeline system; potential use of the little remaining gas at Aliso Canyon to prevent summer electricity interruptions; and possibly allowing for natural gas reinjections at the facility if needed and deemed to be safe.

News Release