June 17, 2016 - From the June, 2016 issue

With Aliso Canyon's Well Now Sealed, How Dependent is Southern California's Energy Portfolio on Natural Gas?

The California Division of Oil, Gas and Geothermal Resources (DOGGR) confirmed in February that the Southern California Gas Company's Aliso Canyon storage facility well that had been leaking natural gas has been permanently sealed and taken out of service. It is important to note that the storage facility is an  important part of Southern California’s interdependent natural gas and electricity systems, Thus, SoCalGas is reportedly working with regulators, customers and service providers to bring the facility aback online "safely, expeditiously and in compliance with all applicable regulations". TPR, aware both of the significance of the issues raised by the above well leak and given that SoCalGas’ service territory encompasses approximately 20,000 square miles throughout central and Southern California, from Visalia to the Mexican border, is pleased to share the following exclusive interview of SoCalGas’ Reg. V.P. of External Affairs and Environmental Strategy, George Minter. 


George Minter

"The incident has put natural gas back in the spotlight...People are taking a new look at the relationship between natural gas and electricity. In particular, it’s also put a spotlight on renewable natural gas." - George Minter, SoCalGas

What are your responsibilities as the external affairs vice president for the Southern California Gas Company?

George Minter: My job responsibilities include all local government affairs, all community relations, and all engagement with groups that shape policy in California. In addition, I’m handling energy and environmental policy, in particular regulation at the air districts, the California Air Resources Board, and the California Energy Commission. My focus with those agencies is on clean energy, clean air, and climate change. 

The methane leak at Porter Ranch in Southern California has led the news for months. What impact will this environmental event have on the future of natural gas in California?

The future of natural gas is being looked at by a lot of different stakeholders with differing perspectives. We’ve heard from critics who question the use of natural gas over the long term—who see it either as a transitional fuel, or as a fossil fuel that should be phased out.

But others realize that natural gas is cleaner than the alternatives for many purposes. In fact, one of the outcomes of the accident has been increased awareness of the connection between natural gas and electricity.

California’s goal for 2020 is 33 percent renewable energy use. The other 67 percent of our energy is not going to be nuclear; it’s not going to come from coal; and in a drought, it’s less and less likely to be hydro. What’s become clear is that as our renewable portfolio grows, we’re going to rely more and more on natural gas.

One reason is quick deliverability. Just think about it: The capacity of solar diminishes at the end of the day, and then it’s gone. Yet that’s exactly when everybody comes home from work and turns on their air conditioning, turns on their TV, and fires up their computer. That’s when demand skyrockets. We’ve got to rely on gas, and we have to rely on it working quickly, because demand ramps up quickly.

As a resource and a physical commodity, natural gas is not unlike water: We have water reservoirs for when we need more water, and we need gas reservoirs like Aliso for when we need more gas. And when we need more gas is when the demand goes up.

After the accident at Aliso, we brought storage levels there down to minimal levels to reduce the pressure and the flow of methane to atmosphere, and to help us kill the well. But 17 generators rely on that reservoir. We need to get it back up and running so that when demand increases in the summer months for electric generation, and again in the winter months for heat, we can start withdrawing some gas. That’s the challenge right now.

A report was issued about a month ago that warned of potential blackouts, or rolling blackouts in order to manage a tight supply of natural gas. The energy agencies, as well as LADWP, now realize the importance of reliable storage facilities.

Despite the rationality of having reliable storage facilities for natural gas, public discussion continues to focus on whether the storage facility is needed. What can SoCalGas do when the media narrative runs so counter to market place need for regional storage?

Facts, and needs, often change whatever storyline there may be. People are starting to realize that we need natural gas storage—that we need natural gas.

The narrative is also developing as understanding of the problem increases. The problem at Aliso was not the storage facility itself; the problem was a well. We had a serious well failure, and we fixed it. The issue here, and the legislation that has come to the fore, is about well safety going forward so that we don’t have another leak.

One bill that passed, SB 380, authored by Senator Pavley, institutes very aggressive, state-of-the-art protocols and inspection regimes. Today we’re working to pass those safety inspections and to get wells safely back into operation.

We will only operate Aliso using those wells that are deemed safe under the purview of the Department of Oil, Gas and Geothermal Resources and then the California Public Utilities Commission approves Aliso’s operation. We anticipate that will occur this summer, and hope to be operational by August.

Elaborate on the place going forward for natural gas as a fuel in California’s energy portfolio.

We see natural gas not as a transitional fuel, but as a foundational fuel, whose highest and best use is as a thermal energy resource.

It’s important to note that the natural gas we deliver isn’t from California. There’s really no natural gas production here anymore. There’s oil production, but very little gas is associated with it. 90-95 percent of what we deliver to our customers in California comes from out of state, east of the Colorado River—from the supply basins in the Southwest and up in the Rocky Mountains.

In terms of meeting our GHG targets, we’ve done a lot of studies, as have state agencies, on replacing natural-gas appliances with electric appliances. Doing so wouldn’t yield an efficiency gain or GHG benefit until the state uses more than 50 percent renewable energy—perhaps not until 2040 or 2050. And that’s because we foresee natural gas itself becoming lower and lower in carbon and GHG emissions – through developing and harnessing renewable natural gas.

The area where we see a lot of new demand for natural gas is the transportation sector. Over the last 15 years, almost all the transit districts in Southern California have gone from diesel to 100 percent natural gas, and put in the refueling infrastructure. In fact, now they’re buying renewable natural gas, which in many cases has a lower carbon cycle even than electricity. These are combustion engines that move people and work every day, that meet the needs of the transit agencies, and they’re better and cheaper than electric buses, with potentially equivalent or lower emissions.

There are exciting new developments in engine technology for the heavy-duty transportation sector—long- and short-haul trucking, not just transit. Cummins Westport, an engine manufacturer, has developed a “near zero” engine that’s 90 percent cleaner than the low-NOX engines that are required today. We call it a “near zero” or an “electric equivalent” engine because the emissions that come out of the tailpipe are equivalent to or lower than those that would come from generating the power to run an electric truck.

Technologies like this will likely first be deployed in buses and trucks, but eventually we see them moving to off-road, port handling, construction equipment, rail, and ultimately the ocean-going sector—all of which currently use diesel, or dirty bunker fuel, in the case of the marine sector.

The ARB’s own technology assessment sees electric vehicles in the heavy-duty sector as being 20-30 years out. Why wait 20-30 years? We’re getting calls from the port and rail industries about how we can provide natural gas refueling for them as they transition to natural gas over the next 5-10 years. We’ve got the technology today; let’s deploy it.

We anticipate, over the next several years, a refocusing of state incentive programs to deploy this near-zero technology to get the emission reductions we need. 

What precisely does the term “renewable natural gas” mean?

Natural gas is a fossil fuel -- we find it underground and produce it from oil and gas reserves. But what is natural gas? It’s methane. And what is methane? It’s CH4—a very stable molecule made up of hydrogen and carbon. What we use is the energy content in the hydrogen molecule. Now, where can you get that?

It turns out that a lot of methane that goes into the atmosphere comes from biological sources: the decomposition of organic matter. All organic matter is based on hydrocarbon compounds, and ultimately decomposes into the simplest hydrocarbon molecule, methane.

What makes it renewable? First of all, it comes from a plant resource that continues to regrow. But also, it’s net-zero carbon. It doesn’t contribute carbon to the atmosphere. The CO2 it produces when burned is the same CO2 that it entrapped out of the atmosphere as a living organism.

The ARB has a Short-Lived Climate Pollutant Plana recently proposed strategy for addressing these pollutants like methane and black carbon. What is that plan, and how is it applicable to what the Gas Co. is working on? 

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Most of the world’s climate accords, and most state regulations, have focused on CO2. But more and more people are looking at what are called short-lived climate pollutants, like methane.

Methane doesn’t hang around in the atmosphere for a long time, but it’s very powerful in terms of refracting the sun’s rays and trapping heat.  Today, California is very concerned about methane.

The ARB was mandated by a bill passed by Senator Lara (SB 605) two years ago to develop a plan to reduce short-lived climate pollutants, specifically methane, black carbon, and fluorinated hydrocarbons.

A lot of people concerned about methane focus on the oil and gas industry. But California’s own inventory of methane tells us that less than 9 percent comes from the oil and gas sector. More than 90 percent comes from everywhere else: the human production and waste stream, agriculture, dairies, woodland waste, landfills, sewage treatment facilities, organic waste streams. That’s where our climate pollution problem is, in terms of methane as a short-lived climate pollutant.

ARB’s plan focuses especially on landfills and dairies, which are probably the top two areas where there’s a lot that we can do.

It’s very exciting to us that the state is now interested in capturing this renewable energy resource. We can put it in our pipelines and deliver it to our customers, and decarbonize our pipeline and reduce the fossil content of our fuel. We’re literally going to take the fossil out of the fuel by using renewable natural gas—biomethane.

For perspective: How much methane escaped from Porter Ranch to the atmosphere?

We’re still in the process of validating how much methane went into the air. There’s not yet concurrence among scientists from ARB, from JPL-NASA, and others.

ARB was involved in a variety of studies using technology that can detect methane in the atmosphere. They applied algorithms to the detection data to determine how much methane has escaped.

We, however, have a physical storage reservoir. We know what volumes were in, we know what went in and came out during the leak, and we know what we’re left with. We are working on a purely fact-based accounting. That’s not yet complete.

The detection volumes reported by ARB and popularized in the press are somewhere between 90,000 and 100,000 metric tons.

[Editor’s Note:  Subsequent to this interview SoCalGas announced results of its shut in study and an independent analysis showing between 84, 000 to 86,000 metric tons of methane was released from the Aliso storage field.]

When you compare to that to dairy farms, for example, it’s probably about 20 percent of dairy cow emissions in California for a year—and of course, this leak has now stopped. But dairy cows, year after year, are producing and pumping that methane into the atmosphere—and not just in California.

There’s a lot of biomethane that’s going out into the atmosphere every day that nobody pays attention to. And though Aliso was a significant volume, it’s not a significant source of methane to the atmosphere from a global climate-change perspective.

I don’t want to downplay this; it was the biggest impact of the leak, after all. It does have a climate impact, and we committed early on to offset and mitigate that impact.

The ARB has developed a plan for mitigation under the Governor’s orders. We agree on a lot more than we disagree on. We like some of the approach that they’ve articulated. It makes sense for us. We are developing our mitigation plan and our focus is going to be on capturing the emission needed to offset the methane that went into the atmosphere from the leak.

How are regulatory agencies and the Gas Co. going to use last year’s events to assure both a reliable energy supply, and a transition to fuels that will help us clean up our environment? 

The incident has put natural gas back in the spotlight. People are taking a new look at the relationship between natural gas and electricity. In particular, it’s also put a spotlight on renewable natural gas: Why do we need to use fossil gas if we have all this biogas going into the atmosphere, and the ability to capture it?

We think that in the months and years ahead, attention will turn to how to deliver biomethane to customers once we’ve captured it. That’ll require a new look at building pipeline interconnects, and at conditioning gas so it’s the same quality and specs as the natural gas that’s already in the pipeline.

Of course, there will also be increased attention to well safety. There’s a bill in the state Legislature that would apply the protocols we’re now subject to on Aliso to all other storage fields in California.

We’re also hearing people ask about the tens of thousands of abandoned wells throughout LA. They can be sources of methane as well; shouldn’t we be doing something about them?

If we spoke again in six months or a year, how different would our conversation be about natural gas’s place on California’s energy portfolio?

We’ll have turned the corner on this accident, which has now been resolved. We’ll know how we’ll be mitigating its effects, and we’ll see a lot of positive outcomes.

We’ll continue to see safe well operations, safe storage operations, and expedient dispatch to generators who call for gas. 

We’ll also see resolution on who should be building the pipeline infrastructure to get all this biomethane into the energy system. We’ll see biogas production and conditioning projects built.

In fact, some of these projects are being built already. In the City of Perris in Riverside County, an innovative waste hauler CR&R has begun revising their franchise agreements with cities to accommodate organic waste separation, which is a legal requirement for jurisdictions now. CR&R built an anaerobic digester for organic waste, and they’re producing enough renewable natural gas to power their entire fleet of 500 heavy-duty trash-hauling trucks, and another 500 street sweepers.

We’re building the pipeline interconnect to their facility to deliver that renewable gas to customers.  This is the kind of infrastructure needed to decarbonize our pipeline, take the fossil out of the fuel, and deliver clean, renewable gas to our customers.

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© 2019 The Planning Report | David Abel, Publisher, ABL, Inc.